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2025 (3) TMI 1179 - SC - Indian LawsScope of consumer under the Consumer Protection Act 1986 - liability on the appellant to disburse the remaining consideration amount for sale of the flat payable to the complainant-respondent by the borrower. Whether the appellant was liable to disburse the remaining consideration amount of Rs.31, 00, 000/- for the sale of the flat to the respondent? - HELD THAT - The appellant assuming any liability in this regard existed at all taking the respondent s case at the highest could not have been saddled with having to pay more than what was envisaged under the Home Loan Agreement between the borrower and the appellant. In any event the appellant s liability under the Agreement for sale was restricted only to satisfying the dues of the complainant-respondent with ICICI Bank which sum was in fact quantified at Rs.17 87 763/- and in any view of the matter could not have exceeded Rs.23 40 000/-. Thus the NCDRC could not have under any circumstance taken a view that the appellant was liable to pay Rs.31 00 000/- both to ICICI Bank as well as to the complainant-respondent who was not a party to the ultimate sanction of the loan by the Home Loan Agreement which was between the appellant and the borrower. Hence the question is answered in the negative. Whether the respondent qualifies as a consumer under the Consumer Protection Act 1986? - HELD THAT - The complainantrespondent cannot be said to be a consumer under the Act as it had no privity of contract with the appellant due regard being had to the totality of the factual matrix. Condonation of delay in filing complaint - HELD THAT - The purported Tripartite Agreement is dated 09.02.2008. The cause of action statedly had arisen in/by April/May 2008. The respondent filed a complaint under the Act on 16.04.2018 - While the NCDRC is competent to condone any period of delay in filing a complaint beyond two years from the date when the cause of action arises the discretion is circumscribed by twin conditions (i) that the complainant satisfy the NCDRC that he had sufficient cause for not filing his complaint within such period and; (ii) that the NCDRC record the reasons for condoning such delay. We have perused the ordersheets of the NCDRC pertaining to the complaint at hand. Neither reasons nor a formal order condoning delay is forthcoming either in the ordersheets or in the Impugned Order - Delay cannot be condoned. As vivid from Emaar MGF Land Ltd. v Aftab Singh 2018 (12) TMI 1940 - SUPREME COURT and M Hemalatha Devi 2023 (10) TMI 1510 - SUPREME COURT even in a consumer dispute under the Act or for that matter the Consumer Protection Act 2019 arbitration if provided for under the relevant agreement/document can be opted for/resorted to however at the exclusive choice of the consumer alone. As the appellant is not a consumer in terms of the Act and the existence of the Tripartite Agreement is doubtful we need not dwell further hereon. Conclusion - i) The respondent is not a consumer under the Consumer Protection Act 1986 due to the lack of privity of contract with the appellant. ii) The appellant Is not liable to pay the full sale consideration of Rs.31, 00, 000/- as the purported Tripartite Agreement did not establish such an obligation. Appeal allowed.
ISSUES PRESENTED and CONSIDERED
The Court considered two primary issues: 1. Whether the respondent qualifies as a 'consumer' under the Consumer Protection Act, 1986. 2. Assuming the respondent is a 'consumer,' whether the appellant was liable to disburse the remaining consideration amount of Rs.31,00,000/- for the sale of the flat to the respondent. Ancillary issues included the existence and implications of a purported Tripartite Agreement, the role of the borrower as a necessary party, and the complaint's timeliness under the limitation period prescribed by the Act. ISSUE-WISE DETAILED ANALYSIS 1. Consumer Status under the Act: - Relevant legal framework and precedents: Section 2(1)(d) of the Consumer Protection Act, 1986 defines a 'consumer' as someone who buys goods or avails services for consideration. The Court referenced previous judgments, including Indian Oil Corporation v Consumer Protection Council, Kerala, and Janpriya Buildestate Pvt. Ltd. v Amit Soni, to emphasize the need for privity of contract to establish consumer status. - Court's interpretation and reasoning: The Court clarified that its previous order only made a prima facie observation on the respondent's consumer status, leaving the NCDRC to decide the issue on merits. The NCDRC failed to provide reasoning on how the respondent was a 'consumer' under the Act. - Key evidence and findings: The respondent did not produce a signed Tripartite Agreement, and the appellant had no privity of contract with the respondent, as the primary transaction was between the respondent and the borrower. - Application of law to facts: The absence of a direct contractual relationship between the appellant and the respondent meant the latter could not be classified as a 'consumer.' - Treatment of competing arguments: The appellant argued that the respondent was not a consumer, while the respondent relied on the Court's previous prima facie view, which was not conclusive. - Conclusions: The Court concluded that the respondent was not a 'consumer' under the Act, as there was no privity of contract with the appellant. 2. Liability to Disburse Remaining Amount: - Relevant legal framework and precedents: The Court examined the terms of the purported Tripartite Agreement and the Home Loan Agreement between the borrower and the appellant. - Court's interpretation and reasoning: The Court found that the appellant's liability was limited to the sanctioned loan amount of Rs.23,40,000/-, primarily for foreclosing the respondent's loan with ICICI Bank. The NCDRC's order directing the appellant to pay Rs.31,00,000/- was without basis. - Key evidence and findings: The unsigned and unstamped Tripartite Agreement did not establish any obligation for the appellant to pay the full sale consideration to the respondent. - Application of law to facts: The appellant's liability was limited to the amount sanctioned under the Home Loan Agreement, and there was no basis for the NCDRC's order to pay the full consideration. - Treatment of competing arguments: The respondent argued for the existence of a Tripartite Agreement, while the appellant denied such an agreement and highlighted the lack of evidence. - Conclusions: The Court concluded that the appellant was not liable for the full sale consideration, as the purported Tripartite Agreement did not impose such an obligation. Ancillary Issues: - Limitation Period: The Court noted that the complaint was filed beyond the two-year limitation period, and the NCDRC failed to record reasons for condoning the delay. - Non-joinder of Necessary Party: The borrower was not joined as a party to the proceedings, which the Court found to be a significant oversight, as the borrower was a necessary party to address the existence of the Tripartite Agreement. SIGNIFICANT HOLDINGS - The Court held that the respondent was not a 'consumer' under the Consumer Protection Act, 1986, due to the lack of privity of contract with the appellant. - The Court determined that the appellant was not liable to pay the full sale consideration of Rs.31,00,000/-, as the purported Tripartite Agreement did not establish such an obligation. - The Court emphasized the importance of adhering to the limitation period and the necessity of joining all relevant parties in proceedings. - The appeal was allowed, and the Impugned Order of the NCDRC was set aside. The Court noted that this judgment would not impact any proceedings between the borrower and the respondent.
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