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2025 Supreme(Online)(SCDRC) 39725

STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Sangita Dhingra Sehgal, President, Bimla Kumari, Member
Sanjay Rana – Appellant
Versus
Parsvnath Builder Ltd. – Respondent
COMPLAINT CASE NO.- 1985/2017

Advocates:
For the Appellants/Petitioners: Sagar Shivam Jaiswal
For the Respondents: T. P. Chauhan, Tanvi Garg, Shambhani Singh

Failure to provide possession of a booked property within the contractually stipulated period constitutes a continuous deficiency in service, granting the consumer a recurring cause of action and the right to seek a refund with interest, irrespective of delayed project timelines.

Headnote:(A) Consumer Protection Act, 1986 - Section 2(1)(g) - Deficiency of service - Real estate - Failure to deliver possession of flat within stipulated time - Held, failure to deliver possession constitutes a continuous wrong and a recurring cause of action. (Paras 18, 19, 29, 30)

(B) Consumer Protection Act, 1986 - Section 2(1)(d) - Consumer - Definition - Mere allegation of commercial purpose cannot be a ground to reject a consumer complaint without documentary evidence establishing that the purchaser is in the business of buying and selling properties. (Paras 14, 15)

(C) Consumer Protection Act, 1986 - Section 24A - Limitation period - Cause of action for non-delivery of possession is continuous; thus, complaint not barred by limitation. (Paras 18, 19)

Facts of the case:
Complainant booked a flat with the Opposite Party in 2006, paying Rs. 18,98,592/-. Despite the agreement requiring possession within 36 months, the project completion was delayed indefinitely. Complainant approached the Commission seeking possession, refund, and compensation for harassment.

Findings of Court:
The Commission held that the builder's failure to complete the project within the stipulated time is a deficiency in service. The objections regarding the complaint being time-barred and the complainant not being a 'consumer' were rejected due to lack of evidence.

Issues: Whether the complainant is a 'consumer' under the Act; whether the complaint is barred by limitation; whether there is a deficiency in service by the builder.

Ratio Decidendi: Failure to deliver possession of a flat within the agreed time is a continuous wrong creating a recurring cause of action. The burden of proof to establish 'commercial purpose' lies upon the developer, and a mere assertion without evidence is insufficient to disqualify a complainant from the status of a 'consumer'.

Result: Complaint allowed; Opposite Party directed to refund the deposited amount with interest and pay compensation for mental agony and litigation costs.

Table of Content
1. failure to deliver possession constitutes breach of contract. (Para 1 , 2 , 3)
2. parties' contentions on maintainability and deficiency. (Para 4 , 5 , 6 , 7)
3. definition of consumer; onus of proving commercial purpose. (Para 10 , 11 , 12 , 13 , 14 , 15)
4. limitation period for recurrent cause of action. (Para 16 , 17 , 18 , 19)
5. jurisdiction of consumer commission over housing services. (Para 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27)
6. developer deficiency in service due to delay. (Para 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35)
7. award of refund, interest, and costs. (Para 36 , 37 , 38 , 39 , 40)

CORAM:

HON’BLE JUSTICE SANGITA DHINGRA SEHGAL (PRESIDENT)

HON’BLE MS. BIMLA KUMARI, MEMBER (FEMALE)

Present: Mr. Sagar S. Jaiswal, Counsel for the complainant appeared through VC.

Mr. T. P. Chauhan, Ms. Tanvi Garg and Ms. Shambhani Singh, Counsel for the OP (Email :tgarg@knm.in)

PER: HON’BLE JUSTICE SANGITA DHINGRA SEHGAL (PRESIDENT)

JUDGMENT

1. The present complaint has been filed by the Complainant before this commission alleging deficiency of service on the part of Opposite Party and has prayed the following reliefs:

(A) Pass an order directing the respondent / opposite party to hand over the possession of the flat bearing no. T-10/1101, Greater Noida, U.P. to the complainant, and / or,

(B) Award a sum of Rs.18,98,552/- (Rupees Eighteen Lakhs Ninety eight thousand five hundred fifty two only) alongwith an interest @ 24% p.a. from the date of booking till the realization of the amount, and / or,

(C) Award a sum of Rs.5,00,000/-towards the damages for loss suffered by the complainant on account of non delivery of the aforesaid flat, and /or,

(D) Award a sum of Rs.20,00,000/- as compensation towards the harassment and mental agony suffered by the complainant, and / or,

(E) award cost of the present proceedings in favour of the complainant which this Hon'ble Commission may deem fit and proper, and / or,

(F) Pass such other or further order as this Hon'ble Commission may deems fit and proper in the facts and circumstances of the case in favour of the complainant and against the opposite parties.

2. Brief facts necessary for the adjudication of the present matter are that on 02.05.2006, the Complainant booked a flat in the project “Parsvnath Privilege” of the Opposite Party, situated at Greater Noida, Uttar Pradesh by paying a booking amount of Rs. 10,00,000/-. The Opposite Party vide allotment letter dated 23.02.2007, allotted flat bearing no. T-10/1101 with a super area of 1855 sq. ft. for a basic sale price of Rs. 52,86,750/-. Thereafter, a Flat Buyer Agreement dated 16.06.2007 was executed between the parties. As per Clause 10(a) of the said Agreement, the Opposite Party was required to complete the construction of the flat within 36 months from the date of commencement of construction of the particular block in which the flat is located. However, till date, the Opposite Party has neither completed the construction of the said flat nor handed over possession to the Complainant. Furthermore, the construction of the said project has been extremely slow and presently the progress at the site has come to a standstill. The Complainant made several communications regarding the status of construction and possession but the Opposite Party failed to provide any satisfactory response.

3. The Complainant had opted for the construction-linked payment plan and paid a total amount of Rs. 18,98,592/- as and when demanded by the Opposite Party. However, the Opposite Party never disclosed the actual status of construction nor apprised the Complainant of the progress at the site. The Complainant also served a legal notice dated 22.09.2017 upon the Opposite Party seeking either possession of the flat or in the alternative; refund of the amount deposited along with interest but was of no avail.

4. The Opposite Party has contested the present case and raised preliminary objections as to the maintainability of the complaint case. The counsel

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2025 Supreme(Online)(SCDRC) 39725

STATE CONSUMER DISPUTES REDRESSAL COMMISSIONSangita Dhingra Sehgal, President, Bimla Kumari, MemberSanjay Rana – AppellantVersusParsvnath Builder Ltd. – RespondentCOMPLAINT CASE NO.- 1985/2017

Failure to provide possession of a booked property within the contractually stipulated period constitutes a continuous deficiency in service, granting the consumer a recurring cause of action and the right to seek a refund with interest, irrespective of delayed project timelines.

Cases Referred (1)

STATE CONSUMER DISPUTES REDRESSAL COMMISSION
Sangita Dhingra Sehgal, President, Bimla Kumari, Member
Sanjay Rana – Appellant
Versus
Parsvnath Builder Ltd. – Respondent
COMPLAINT CASE NO.- 1985/2017