SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

2022 Supreme(Del) 2011

IN THE HIGH COURT OF DELHI
C. Hari Shankar, J.
Puri Construction Pvt. Ltd. - Appellant
Versus
Shailesh Gupta - Respondent
CM(M) 520 of 2020 & CM Appl. 26760 of 2020
Decided On : 17-08-2022

Headnote:

Consumer Complaint - Class Action Complaint - Consumer Protection Act, 1986, Section 12(1)(c), Section 212, Order I Rule 83 of the CPC - The court discussed the application of Section 12(1)(c) of the Consumer Protection Act, 1986, and Order I Rule 8 of the CPC in allowing the filing of a class action complaint on behalf of all the allottees of residential flats in the 'Aanand Vilas' project. The court highlighted the requirement of commonality of interest and the necessity of issuing public notice before allowing amendments to the complaint.

Fact of the Case:

Consumer Complaint 335/2017 was filed by the respondent and 47 other complainants against the petitioner Puri Construction Pvt. Ltd. before the National Consumer Disputes Redressal Commission under Section 12(1)(c) of the Consumer Protection Act, 1986, as a representative class action complaint. The complaint alleged unfair trade practices by the petitioner in the 'Aanand Vilas' project, seeking various reliefs including possession of apartments, refund of excessive amounts, and compensation for mental agony.

Finding of the Court:

The court found that the amendment to the complaint, which sought to abandon the relief of possession originally claimed, was allowed without issuing the necessary public notice to all persons so interested, as required by Order I Rule 8(4) of the CPC. The court held that the impugned orders were directly opposed to the statutory provisions and, therefore, quashed and set aside the orders.

Issues: The main issue was the application of Section 12(1)(c) of the Consumer Protection Act, 1986, and Order I Rule 8 of the CPC in allowing the filing of a class action complaint and subsequent amendments to the complaint without issuing public notice to all persons so interested.

Ratio Decidendi: The court emphasized the requirement of commonality of interest and the necessity of issuing public notice before allowing amendments to a class action complaint, as mandated by Order I Rule 8(4) of the CPC. The court held that equity cannot operate against the statute and quashed the impugned orders for being directly opposed to the statutory provisions.

Final Decision: The petition was allowed, and the impugned orders dated 29th August 2019 and 9th September 2020 were quashed and set aside.

Judgement Key Points

Key Points: - Class action complaints under Section 12(1)(c) require commonality of interest among numerous consumers (!) (!) . - Public notice must be issued to all "persons so interested" before allowing amendments that abandon part of the claim (!) (!) . - Equity cannot override statutory provisions requiring prior notice for amendments abandoning claims (!) (!) .

What is the requirement for allowing amendments to a class action complaint under Section 12(1)(c) of the Consumer Protection Act?

How to determine who qualifies as "persons so interested" for notice requirements in class action proceedings?

Does equity permit allowing amendments to class action complaints that abandon original relief claims without prior public notice?


JUDGMENT (Oral)

1. Consumer Complaint 335/2017 was instituted by the respondent Shailesh Gupta and 47 other complainants against the petitioner Puri Construction Pvt. Ltd. before the learned National Consumer Disputes Redressal Commission ("the learned NCDRC") under Section 12(1)(c)1 read with Section 212 of the Consumer Protection Act, 1986 ("the Act") and Order I Rule 83 of the First Schedule to the Code of Civil Procedure, 1908 ("the CPC"), as a representative class action complaint. It was clearly stated, in the complaint, that it was being filed for resolution and redressal of the grievances of the 48 named complainants "and also to address the common grievance of all the consumers who are affected by the price discrimination by the opposite party in the `Aanand Vilas' project".

2. The complaint averred that, relying on advertisements issued by the petitioner, the complainants booked apartments in the `Aanand Vilas' project by making an initial payment of Rs.7.5 lakhs for 3 BHK and Rs.10 lakhs for 4 BHK apartments. It was alleged, in the complaint, that (i) the application form provided to the complainants and other investors in the petitioner's project did not contain relevant or substantial information about the project or the time within which it would be completed (ii) the Provisional Allotment letter, which was forwarded to the investors/apartment buyers nearly a month after the filing of the application form, stated, inter alia, that, if the signed application form was not received back within 15 days of receipt by the concerned apartment buyer/investor, the offer of allotment would stand automatically cancelled and the money deposited by the investor/buyer would be refunded after deducting 15% of the sale consideration of the flat as earnest money, without interest, (iii) the Apartment Buyer Agreement (ABA) which subsequently came to be executed between the buyers and the petitioner was a one sided document containing several arbitrary and coercive clauses; moreover, it enhanced the period within which possession of the flats were to be handed over to the buyers to 54 months, as against 36 months held out at the pre-launched stage, (iv) the buyers/investors were coerced to pay several charges such as Preferential Location Charges (PLC), car parking, club furnishing charges and fire fighting charges, which found no place in the initial application form provided to them, which they had filled in and submitted, (v) though 80-90 % of the payments demanded by the petitioner had been paid by the complainants, the complainants were forced to honour all the allegedly illegal demands of the petitioner and (vi) the petitioner was allotting identical flats to outsiders at nearly half the price at which they were allotted to the complainants.

3. These acts of the petitioner, it was alleged, constituted "unfair trade practices" within the meaning of Section 2(r)(1)(ix)4 of the Act, as the petitioner was effectively misappropriating hard earned money of the investors.

4. Predicated on the aforesaid allegations, the consumer complaint prayed thus:

    "That in view of the above, the Complainants pray before this Hon'ble Commission to:

    i. Direct the Opposite Party to handover legal possession of the respective apartments to all the similarly situated aggrieved buyers/allottees/consumers who have been affected because of the price discrimination in the project "Aanand Vilas, in Sector 81, Faridabad, Haryana" of the Opposite Party which is complete in all respect and in conformity with the Apartment Buyer Agreement and along with the completion certification and all other additional/requisite permissions for the same;

    ii. Direct the Opposite Party for an immediate 100% refund of the excessive amount paid by all the similarly situated aggrieved buyers/allottees/consumers who have been affected because of the price discrimination in the project "Aanand Vilas, in Sector 81, Faridabad, Haryana" of the Opposite Party like the inflated B

Click Here to Read the rest of this document
1
2
3
4
5
6
7
8
9
10
11
Judicial Analysis

AI

SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top