DDA found guilty of delaying allotment, denying possession

The Delhi Development Authority, which would be holding on Tuesday the keenly awaited draw of lots for its biggest housing scheme till date, has been found to be “highly oppressive” and exploiting its dominant position by denying allotment of flats to four persons for over a decade and revising the prices without any justification.

The Delhi State Commission has in four similar cases found that the DDA at first floated the second Self Financing Scheme (Commercial Flats), 1985, for allotment of commercial flats. Admitting delay in starting work on the project, it offered allottees some ready-built flats. It, however, took over 14 years to issue a demand letter and that too at revised prices.

“The facts and circumstances of this case amply prove that the appellant (DDA) have exploited their dominant position in delaying the allotment of flat and also demanding an amount to be deposited by way of a different schedule from time to time and revising their prices without any justification, cause or reason thereof,” said a Bench of S.A. Siddiqui and S.C. Jain.

“...the conduct of DDA in denying the possession to the respondent till date is highly oppressive, constituting not only deficiency of service but also unfair trade practice as defined in the Consumer Protection Act,” the Commission added.

The Commission was hearing four similar appeals filed by the civic agency through its Vice-Chairman against the order of District Consumer Forum which had directed the land agency to allot and deliver possession of commercial flats to complainants for the same price as was mentioned in the demand letter or alternatively any other commercial flat of the same area in the same locality for the same price.

In one of the four matters, one Rajesh Kumar registered under the 1985 scheme by paying Rs.20,000 registration fee.

Delay in project

On December 17, 1991, the DDA wrote to Mr. Kumar informing there was some delay in the project but some already built flats were available. On December 31, 1992, the DDA again wrote to him informing that no specific building/project under the 1985 scheme has yet been taken up and offered flats in Janakpuri and Laxmi Nagar District Centres, which are being constructed independently of 1985 Scheme.

The DDA further informed that flats in Janakpuri and Laxmi Nagar would likely be available for possession by August 1993. Also, 50 per cent of the cost of the flats was payable within 60 days of the allotment and the balance would be payable in two equal instalments. The estimated prices of the flats at Janakpuri and Laxmi Nagar was quoted as Rs.18,145 per sq.m. and Rs.14,839 per sq.m. respectively.

Mr. Kumar accepted the offer and opted for allotment of flat in Laxmi Nagar. Draw for specific flats was held on December 8, 1999, and he was successful.

He was asked to deposit the entire amount in 30 days.

After adjusting the initial deposit, he found an increase from the price quoted in 1993.

The complainant contended that the DDA took nearly 10 years to even hold the draw and allot flats and raised the price arbitrarily. The complainant received a demand letter in March 2000 for payment of increased amount of Rs.17,56,337.

Finding the action illegal, the complainant moved a writ petition before the Delhi High Court seeking to know if cost escalation was within the contract and if it could be challenged. The same was dismissed by the High Court in 2004. In the meantime, without giving any notice, the DDA cancelled the allotment of flat in his name. The complainant then moved the district consumer forum alleging unfair trade practice and deficient services by the DDA.

Deficiency of services

“The material on record shows a clear act of deficiency of services and restrictive trade practice on the part of the DDA. They have first failed to explain the reasons of delay in allocation of flats in the 2000 which were likely to be made available for possession in August 1993 especially in the light of the stated admitted fact that they were ready-built flats.

“Further, no explanation with regard to the reasons of change in the schedule of payment and other terms and conditions have come up from the DDA as it is admitted by them that schedule of payment was changed from time to time,” the commission said.

In three other cases too, the complainants had registered in the 1985 scheme and then opted for plots in Janakpuri and Laxmi Nagar district centres.

They faced similar situation.