TMI Blog2022 (1) TMI 1404X X X X Extracts X X X X X X X X Extracts X X X X ..... s on the nature of title to the land, encumbrances on the land, fixtures, fittings and amenities to be provided, and to not grant possession of a flat until a completion certificate is given by the local authority. The responsibility to obtain the occupancy certificate from the local authority has also been imposed under the agreement to sell between the members of the appellant and the respondent on the latter. It is evident that there was an obligation on the respondent to provide the occupancy certificate and pay for the relevant charges till the certificate has been provided. The respondent has time and again failed to provide the occupancy certificate to the appellant society. For this reason, a complaint was instituted in 1998 by the appellant against the respondent. The NCDRC on 20 August 2014 directed the respondent to obtain the certificate within a period of four months. Further, the NCDRC also imposed a penalty for any the delay in obtaining the occupancy certificate beyond these 4 months - This continuous failure to obtain an occupancy certificate is a breach of the obligations imposed on the respondent under the MOFA and amounts to a continuing wrong. The appellants ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e complaint was filed by the appellant for refund of the excess taxes and charges paid the appellant to the municipal authorities, due to the alleged deficiency of service of the respondent. By the impugned order, the NCDRC dismissed the complaint on the ground that it was barred by limitation and that it was not maintainable since it was in the nature of a recovery proceeding and not a consumer dispute. 2 The appellant is a co-operative housing society. The respondent constructed Wings A and B and entered into agreements to sell flats with individual purchasers in accordance with the Maharashtra Ownership Flats (Regulation of the Promotion of Construction, Sale, Management and Transfer) Act 1963 MOFA . The members of the appellant booked the flats in 1993 and were granted possession in 1997. According to the appellant, the respondent failed to take steps to obtain the occupation certificate from the municipal authorities. In the absence of the occupation certificate, individual flat owners were not eligible for electricity and water connections. Due to the efforts of the appellant, temporary water and electricity connections were granted by the authorities. However, the m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in 1997, which they have continued to enjoy since then. The possession was obtained against the law as no occupancy certificate had been provided by the respondent-builder; (ii) The cause of action arose at the time when the appellant made efforts to obtain individual water and electricity connections and the municipal authorities ordered the members to pay higher charges. The complaint should have been filed within two years of the accrual of the cause of action; (iii) Since the cause of action arose on the date when the municipal authorities demanded payment of higher taxes and charges, the period of limitation also commenced from this date and cannot be extended by the communication between parties; (iv) With respect to the claim that there was a continuing cause of action due to non-availability of the occupancy certificate, no relief was sought by the appellant in their complaint regarding the obtaining of an occupancy certificate. The only relief which was sought is a refund of Rs. 2.60 crores for payment of higher taxes . 7 On the merits of the dispute, the NCDRC observed that the complaint was filed for refund of the excess amount paid by the appellant ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been issued against the respondent; and (viii) Under the MOFA and the agreement to sell with the members of the appellant, the respondent has an obligation to obtain the occupancy certificate. Due to the deficiency in service, the members of the appellant have had to make excess payment. Thus, the appellant is a consumer under the Consumer Protection Act 1986. 9 Opposing these submissions, Mr Atul Babasaheb Dakh, appearing on behalf of the respondent submitted that: (i) When the construction of the project was completed in 1997, the respondent applied for an occupancy certificate. However, the respondent did not offer possession to the flat-purchasers; (ii) The members of the appellant society took possession of their flats to refurbish the interiors and to make suitable arrangements till the occupancy certificate was issued. Instead, they started occupying the premises and made arrangements for water and electricity by paying additional charges; (iii) The members of the appellant made unauthorized constructions due to which there was a delay in obtaining the occupancy certificate; (iv) The proposal for one-time settlement in 2014 did not pertain t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng wrong, the complaint is within limitation. 12 Section 22 of the Limitation Act 1963 22. Continuing breaches and torts. In the case of a continuing breach of contract or in the case of a continuing tort, a fresh period of limitation begins to run at every moment of the time during which the breach or the tort, as the case may be, continues. provides for the computation of limitation in the case of a continuing breach of contract or tort. It provides that in case of a continuing breach of contract, a fresh period of limitation begins to run at every moment of time during which the breach continues. This Court in Balakrishna Savalram Pujari Waghmare v. Shree Dhyaneshwar Maharaj Sansthan AIR 1959 SC 798 elaborated on when a continuous cause of action arises. Speaking for the three-judge Bench, Justice PB Gajendragadkar (as the learned Chief Justice then was) observed that 31. [ ] Does the conduct of the trustees amount to a continuing wrong under Section 23? That is the question which this contention raises for our decision. In other words, did the cause of action arise de die in diem as claimed by the appellants? In dealing with this argument it is necessary to bear in mi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lty may be correlated to the time-lag between the last day for filing it without penalty and the day on which it is filed and the quantum of tax or wealth involved in the case for purposes of determining the quantum of penalty but the default however is only one which takes place on the expiry of the last day for filing the return without penalty and not a continuing one. The default in question does not, however, give rise to a fresh cause of action every day. Explaining the expression a continuing cause of action Lord Lindley in Hole v. Chard Union [(1894) 1 Ch D 293 : 63 LJ Ch 469 : 70 LT 52] observed: What is a continuing cause of action? Speaking accurately, there is no such thing; but what is called a continuing cause of action is a cause of action which arises from the repetition of acts or omissions of the same kind as that for which the action was brought. (emphasis supplied) The Court further provided illustrations of continuous wrongs: 17. The true principle appears to be that where the wrong complained of is the omission to perform a positive duty requiring a person to do a certain act the test to determine whether such a wrong is a continuing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the effect of the injury caused has continued, is not sufficient to constitute it as a continuing wrong. For instance, when the wrong is complete as a result of the act or omission which is complained of, no continuing wrong arises even though the effect or damage that is sustained may enure in the future. What makes a wrong, a wrong of a continuing nature is the breach of a duty which has not ceased but which continues to subsist. The breach of such a duty creates a continuing wrong and hence a defence to a plea of limitation. (emphasis supplied) 15 A continuing wrong occurs when a party continuously breaches an obligation imposed by law or agreement. Section 3 of the MOFA imposes certain general obligations on a promoter. These obligations inter alia include making disclosures on the nature of title to the land, encumbrances on the land, fixtures, fittings and amenities to be provided, and to not grant possession of a flat until a completion certificate is given by the local authority. The responsibility to obtain the occupancy certificate from the local authority has also been imposed under the agreement to sell between the members of the appellant and the responden ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertificate. Owing to the failure of the respondent to obtain the certificate, there has been a direct impact on the members of the appellant in terms of the payment of higher taxes and water charges to the municipal authority. This continuous failure to obtain an occupancy certificate is a breach of the obligations imposed on the respondent under the MOFA and amounts to a continuing wrong. The appellants therefore, are entitled to damages arising out of this continuing wrong and their complaint is not barred by limitation. 19 The NCDRC in its impugned order has held that the cause of action arose when the municipal authorities ordered the payment of higher taxes in the first instance. Further, the impugned order also states that the present complaint is barred by limitation as there is no prayer for supply of occupancy certificate. We are unable to subscribe to the view of the NCDRC on both counts. Undoubtedly, the continuing wrong in the present case is the failure to obtain the occupancy certificate. Against this act of the respondent, the appellant society has taken appropriate action by filing a complaint before the consumer forum. The appellant is currently pursuing the exe ..... X X X X Extracts X X X X X X X X Extracts X X X X
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