Wednesday, February 1, 2023

Non-performance of Contract constitutes deficiency: NCDRC

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The National Consumer Disputes Redressal Commission (NCDRC) dismissed an appeal in Nasibuddin v Nafis Ahmad stating that while a party to a contract is under an obligation to perform, his non-performance constitutes a deficiency, giving rise to a legal claim by the other party.

The division bench of Dr. S.M. Kantikar, Presiding Member & Mr Dinesh Singh, Member said, “the order of the State commission is within the ambit and scope of Section 21(b), we find no crucial error in appreciating the evidence by the two Fora below, as may cause de novo re-appreciation of the evidence in revision.”

The complainant (Respondent in the present case) had deposited Rs.1,41,000/- with the appellant herein for 60,000 bricks in total for the construction of his house. The appellant has told the rate of brick at 2350.00 per thousand. It was agreed between the appellant and the complainant (respondent) that the bricks will be delivered at the house of the respondent in piecemeal quantity. The appellant delivered 14,600 bricks at the house of the complainant on various dates; thereafter due to increase in the rate of bricks, he refused to give the bricks on the old rates and did not refund the balance amount. The complainant served a legal notice to the appellant but of no recourse. He then filed a complaint before the District Forum. On the basis of the evidence and pleadings of the parties, the District Forum allowed the complaint and directed the appellant to pay Rs 1,06,923.00 with simple interest.

Following which the appellant moved the State Commission which upheld the order passed by the District Forum, dismissing the appeal filed by the appellant and directed him to pay the amount as per the order of District Forum.

Aggrieved by the order of State Commission, the appellant filed a Revision Petition before the National Consumer Dispute Redressal Commission.

The NCDRC has upheld the order passed by the State Commission and said, “We note that the total consideration amount of Rs 1,41,000/- was paid in advance for purchasing 60,000 bricks at the rate of Rs 2350/- per thousand bricks, the three essential ingredients of contract, offer, acceptance and consideration, were met, the contract was duly made. The opposite party (appellant) was under obligation to perform its part of its contract. Non- performance constitutes deficiency.”

The award made by the District forum, which has been affirmed by the State Commission, we note that refund of Rs 1,06,925/- being the balance proportionate amount in respect of the balance number of bricks left undelivered, to be just and equitable. We also note the rate of interest of 8% p.a. from the date of deposit till its realisation to be just and appropriate”, said the order of the National Commission.

The Commission said, “we find no jurisdictional error, or a legal principle ignored, or miscarriage of justice, as may require interference in exercise of our revisional jurisdiction under section 21(b)”, and dismissed the petition being bereft if merits.

It also directed the appellant to comply with the award made by the District Forum, failing which the District Forum shall undertake execution, both for ‘Enforcement’ under Section 25(3) and for ‘Penalties’ under Section 27 of the Consumer Protection Act 1986, as per the law. It directed the Registry to send the copy of the order to the District Forum and to the Complainant.

-India Legal Bureau 

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