2021 Supreme(SC) 371

SUPREME COURT OF INDIA
UDAY UMESH LALIT, HEMANT GUPTA, S. RAVINDRA BHAT, JJ.
M/S LAUREATE BUILDWELL PVT. LTD. – APPELLANTS
VERSUS
CHARANJEET SINGH – RESPONDENT
CIVIL APPEAL NO.7042 of 2019
Decided on : 22-07-2021

IMPORTANT POINTS
(1) Flat-Buyer’s Agreement – Purchaser fulfils description of complainant/ consumer and is entitled to move any forum under Consumer Protection Act for any deficiency in service.
(2) Absence of privity of contract is not a bar for maintaining a complaint against a service provider, by a third party who suffers an incident, which is otherwise covered by an agreement.
(3) Consumer forum or Commission or even Courts have to examine relative equities having regard to time frame in each case.

Headnote:

(A) Consumer Protection Act, 1986 – Section 23 – Consumer Protection Act, 2019 – Section 67 – Real Estate Regulatory Authority Act, 2019 – Real estate – Flat-Buyer’s Agreement – Rights of purchaser vis-à-vis original allottee – Upon issuance of endorsement letter, purchaser not only stepped into shoes of original allottee but also became entitled to receive possession of flat – Purchaser fulfils description of complainant/ consumer and is entitled to move any forum under Consumer Protection Act for any deficiency in service – An individual such as original allottee, enters into an agreement to purchase flat in an on-going project where delivery is promised – Terms of agreement as well as assurance by builder are that flat would be made available within a timeframe – In a large number of such transactions, allottees are not able to finance the flat but seek advances and funds from banks or financial institutions, to which they mortgage property – Prolongation of project would involve serious economic repercussions upon such original allottees – Indefinite wait is impossible and allottees prefer to find purchasers who might step into their shoes – That such purchasers take over obligations of original allottee – either to pay balance instalments or to wait for sometime, would not per se exclude them from description of a consumer – Consumer forum or Commission or even Courts have to examine relative equities having regard to time frame in each case – Absence of privity of contract is not a bar for maintaining a complaint against a service provider, by a third party who suffers an incident, which is otherwise covered by an agreement – Proceedings initiated by complainants and resultant actions including of NCDRC are fully saved by provisions of Real Estate Regulatory Authority Act, 2019. (Paras 23 and 30)

(B) Consumer Protection Act, 2019 – Section 67 – Real estate – Flat-Buyer’s Agreement – Rights of Purchaser – Purchaser agrees to buy flat with a reasonable expectation that delivery of possession would be in accordance within bounds of delayed timeline that he has knowledge of, at the time of purchase of flat – In the event purchaser claims refund, on an assessment that he too can (like original allottee) no longer wait, and face intolerable burdens, equities would have to be moulded – It would be fair to assume that purchaser had knowledge of delay – However, to attribute knowledge that such delay would continue indefinitely, based on an a priori assumption, would not be justified – Equities can properly be moulded by directing refund of principal amounts, with interest @ 9% per annum from the date builder acquired knowledge of transfer, or acknowledged it – In present case, there is material on record suggestive of circumstance that even as on date of presentation of present appeal, occupancy certificate was not forthcoming – In these circumstances, given that purchaser/respondent had stepped into shoes of original allottee, and intimated Laureate about this fact in April 2016, interests of justice demand that interest at least from that date should be granted, in favour of respondent – Directions of NCDRC accordingly modified in such terms. (Paras 31, 32 and 33)

Facts of the case:

Appellant (“Laureate” or the builder”) is aggrieved by order of the National Consumer Dispute Redressal Commission (NCDRC). The respondent (Purchaser) had sought, through his complaint a direction against builder, for refund of the consideration amount of ?1,93,70,883/- received by the latter, as consideration for sale of a flat along with interest @ 24% p.a. from the date different instalments were paid, as well as compensation and costs.

Findings of Court:

Consumer Protection Act, 1986 was conceived as a legislation to address complaints of consumers (an expression defined and interpreted widely) and provide a forum for their quick redressal, and, furthermore, wherever third parties have claimed relief, technicalities have been brushed aside consistently, by this court.

Result : Appeal Partly allowed.