Full Judgment Text
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CASE NO.:
Appeal (civil) 5542 of 2004
PETITIONER:
Karnataka Industrial Areas Development Board
RESPONDENT:
Nandi Cold Storage Pvt. Ltd
DATE OF JUDGMENT: 11/07/2007
BENCH:
Dr. ARIJIT PASAYAT P.K. BALASUBRAMANYAN & D.K. JAIN
JUDGMENT:
J U D G M E N T
I.A. NO.1
IN
CIVIL APPEAL NO. 5542 OF 2004
Dr. ARIJIT PASAYAT, J.
1. Challenge in this appeal is to the order passed by the
National Consumer Disputes Redressal Commission at New
Delhi (in short the ’National Commission’). Respondent had
filed a complaint against the appellant before the National
Commission.
2. Background facts in a nutshell are as follows:
3. In the complaint respondent inter alia stated as follows:
The complainant company, desirous of opening a cold
storage unit in the State of Karnataka, applied for allotment of
land to the appellant in August 1991. After meeting all the
formalities required from time to time by the appellant, a plot
bearing No.2 of Chickballapur Industrial Area, measuring 2.5
acre of land, was allotted for setting up a cold storage.
Possession certificate was issued on 26/30.8.93. The
complainant also in the meantime obtained a loan of Rs.67
lakh from the Karnataka State Financial Corporation (in short
’KFC’). For the first time in August 1994, a letter was written
by appellant to the complainant that "the company could not
go ahead with construction activity on the plot allotted as the
erstwhile land owner of plot No.2 covered in Sy.No.29 and 30
of Jadalathimmanahally Village has obtained stay order from
the High Court of Karnataka in W.P.No.70/88 challenging the
acquisition proceedings. The Board initiated action for
vacating the stay order granted by the High Court of
Karnataka. However, the company could not go ahead with
implementation in view of the stay order granted by the High
Court. The complainant sought for permission to go ahead
with implementation after the litigation in respect of the above
land is disposed of by the High Court. The Board should also
grant extension of time to the company for implementation of
the project after disposal of the litigation.
4. Original land holder took back possession forcibly in view
of the order of the Karnataka High Court. The writ petition
filed by the original land holder was allowed by the High Court
leaving the complainant high and dry without land, more so
when in September 1994, the KFC cancelled the term loan in
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view of the fact that no progress was made in the
implementation of the project. Since the complainant was keen
to go ahead with the project, on collecting some information, it
approached the appellant to allot plot No.1-A and 1-B which
was lying vacant, which were allotted to the complainant in
1995. But it seems that bad luck had not stopped chasing the
complainant. As soon as the allotment in respect of plot no.1-
A and 1-B were made on a resumed plot, the original allottees
moved the High Court making the complainant a party before
it. However, after protracted litigation, the writ petition was
dismissed but in the meanwhile the loans had been cancelled
and the complainant was left high and dry. It is in these
circumstances that a complaint was filed alleging deficiency in
service.
5. The appellant-Board appeared before the National
Commission on issue of notice. It took the stand that there
was no deficiency in service and it acted in terms of the
procedure laid down in Karnataka Industrial Areas
Development Act, 1966 (in short the ’Act’) and Rules made
thereunder. The State Government had acquired the land and
handed over the same to the present appellant for
development and allotment for setting up the industries. The
acquisition was done by the State Government. After the land
was handed over, same was developed and allotted to various
entrepreneurs. Since the appellant came to know about the
pendency of the litigation between the Government and the
original landholder of plot No.2 it had given notice to the
complainant and all that was required to be done for the
complainant was done. There was no deficiency in the service
which was attributed by the government which acquired the
land from the appellant after such acquisition.
6. After hearing learned counsel for the parties the National
Commission held that the appellant was clearly at fault. There
was deficiency in service and it was, therefore, held that the
complaint was to be allowed. Considering the facts and
circumstances of the case the National Commission held that
the complainant was entitled to compensation of Rupees three
lakhs. The order of the National Commission is the subject
matter of challenge in this appeal.
7. In support of the appeal, it was submitted that there was
no deficiency in service in view of what has been stated above.
In any event, there was no scope for awarding compensation.
8. Learned counsel for the respondent on the other hand
supported the order of the National Commission.
9. While issuing notice on 10.9.2004, the same was limited
to the question of compensation. In support of the appeal,
learned counsel for the appellant submitted that there is no
deficiency in service. All possible steps have been taken at
different points of time. In a hypothetical case which was not
established, the National Commission erroneously came to
hold that it was a case of deficiency in service.
10. In the notice, as noted above, it was indicated that the
same was limited to the question of compensation. About the
deficiency in service the correct approach has been adopted.
11. The only question however, is with regard to the
quantum. Considering the peculiar circumstances of the case,
we fix the same to be rupees one lakh. This is to be paid to the
appellant by the respondent within 4 weeks from today.
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12. The appeal is allowed in the aforesaid circumstances. No
order is necessary in the I.A. in view of the disposal of appeal.
There will be no order as to costs.