The Times of India  26.08.2010

Backdrop : Time and again, we come across government-run organizations coming up with various schemes which appear very attractive on paper. But when it comes to actual implementation, the scheme flops, thanks to rampant corruption and gross mismanagement. The citizen who has invested his hard-earned money finds himself battling against a mammoth organization manned by indifferent officials. Can he fight for his rights under the Consumer Protection Act? Yes, as per a recent judgment of the Maharashtra State Commission passed against Mumbai Metropolitan Region Development Authority (MMRDA).

Case Study: Considering the development of textile trade in the city of Mumbai and the inadequacy of market place and congestion, MMRDA took a decision in 1982 to relocate the wholesale market in textiles at the site already allotted to it by the government in the Bandra-Kurla Complex. Accordingly, the development plan was made under which land admeasuring 48.62 hectares was earmarked for the construction of a textile market and additional area of about 10.30 hectares was reserved for public utilization.

MMRDA published a brochure stating that the tentative price of the shop-cum-office or godown would be Rs 5,000 per sq-m, which would be finalized after inviting tenders. It was also represented that the project would be completed within two years of commencement of construction. Applications were invited for booking the premises by paying Rs 15,000.

As the scheme appeared attractive, several traders were interested in booking premises under the project. The Federation of Manmade Textile Traders' Association collected Rs 15,000 from 124 members who were interested. The applications along with the total amount of Rs 18,60,000 was paid to MMRDA, which issued individual receipts acknowledging the receipt of every application made.

In 1990, information leaked out that the land reserved for the project was being de-reserved. The association filed a writ petition in the high court challenging this decision and got a favourable ruling. Yet MMRDA did not take any steps for commencing the project's construction. In May 1996, the traders asked for a refund of their money, but MMRDA ignored their letter.

The traders then got into groups and filed four complaints before the Maharashtra State Commission, seeking a refund of their money along with 18% interest. MMRDA defended itself by claiming that a contract had been given for construction of the textile market and that the traders were uncooperative and critical of the high cost. It claimed that construction had commenced but the price had escalated to Rs 6,000 per sq-m in 1989, which was not acceptable to the traders and hence construction was stopped. MMRDA claimed that in 1998, it had made an offer to All India Textile Traders, which, too, was found unacceptable. Since negotiations were in progress, refund was not given. Hence, the complaint should be dismissed, MMRDA said.

A Bench comprising judges Lale and Kashalkar observed that 17 years had passed since the booking deposit had been paid, but the project could not be completed despite MMRDA's efforts as the traders were unwilling to pay a higher rate due to escalation in costs. It was only after the complaint was filed that MMRDA agreed to refund the money and that, too, without interest.

Since the money was lying with MMRDA for such a long time, the state commission directed a refund of the amount along with 6% interest and cost of Rs 5,000 to each trader.

Impact : There are several unanswered questions. If the intentions were genuine, why did the government try to de-reserve the earmarked plot, forcing the traders to file a writ petition? Who is responsible for the failure to adhere to a time-bound schedule under which the market ought to have been ready by 1984-85? Proper implementation of any scheme would ensure that citizens do not feel cheated.