Consumer spending hefty amount has right to ask for record of expenditure. Can service provider evade liability? Read on

State Consumer Disputes Redressal Commission, U.T. Chandigarh: The Coram of Justice Raj Shekhar Attri (President) and Padma Pandey, Rajesh K. Arya (Members) observed that a service provider cannot state that it was not obliged to provide any record/bills to the consumer, since a person who is spending hefty amount to receive the services has the right to know where, how and in what manner the money was spent.

Complainant had paid an amount of Rs 27 lakhs to the OPs for the construction of a residential house.

Regarding the completion of work, the complainant asked the OPs to provide the details of the bill, but to no avail and as a result, the complainant hired a professional to assess the work done.

After the assessment, it was found that the value of completion of work done by the OPs came to be Rs 16,77,629 whereas they received an amount of Rs 27 lakhs. Due to which the complainant stopped the work.

OPs extracted Rs 10,22, 371 extra from the complainant causing him financial loss and also failed to complete the construction work as per the agreement and demanded more amount.

In view of the above background, the Complainant sought directions to OPs to refund the excess amount.

OP’s Pleading

Opposite Parties pleaded that as per the agreement, the complainant was liable to pay an amount of Rs 62,84,800, Since 60% of the work was completed, the complainant was supposed to pay an amount of Rs 37,73, 880, out of which only Rs 27 lakhs were paid. OPs also submitted that the person who did the assessment was not an expert. Also, the complainant befooled the OP that his loan was going to get sanctioned and hence the OPs should continue the construction work, even in the absence of payment of remaining amount.

OPs also submitted that they were not obliged to provide the detail of bills for the said construction work.

Analysis, Law and Decision

Moot Question: Whether the OPs had received an excess amount from the complainant towards partial construction work of house done on his plot or not?

Bench opined that to come to any definite conclusion, an independent person qualified in the said field was required to be appointed to give his report resultantly, a Local Commissioner was appointed.

Unfair Trade Practice

Commission noted from the report of the Local Commissioner that through the material in the building and structure raised was as per the required specifications, yet the value of work which has been done at the site came to be Rs 15,04,630 only, whereas, on the other hand, the opposite parties have already received an amount of Rs 27 lacs from the complainant, which act clearly amounts to adoption of unfair trade practice.

Deficiency in Service

Adding to its analysis, Bench also stated that the complainant was right in seeking bills from the OPs. In fact, by not providing the bill, OPs were deficient in providing service.

OPs cannot wriggle out of the situation by stating that they were not obliged to provide any record/bills to the complainant, as the same was not agreed to between the parties, because every person who is shredding hefty amount from his pocket towards the services being provided to him, has the right to know as to how, where and in what manner, the same has been utilized.

Conclusion

Commission directed OPs to refund the amount of Rs 11, 95, 370 received in excess along with 12% interest within a period of 30 days.

To pay compensation for causing mental agony and harassment and also cost of litigation, in lumpsum, to the tune of Rs 50,000/-, to the complainant, within a period of 30 days

If the complainant had availed housing loan from any bank/financial institution for making payment towards price of plot in question, it shall have the first charge on the amount payable, to the extent, the same was due to be paid by the complainant. [Mubarak Masih v. Gautam Construction Company, Complaint Case No. 57 of 2019, decided on 27-05-2021]


Advocates before the Commission:

Abhishek Bhateja, Advocate for the complainant.

N.K. Nagar, Advocate for the opposite parties.

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