2022 (12) TMI 363 - Commission - Indian Laws

Consumer Protection - Seeking hand over possession of the residential duplex flat to the Complainant - Complainant was promised by a settlement agreement a residential duplex flat in a real estate project labelled as Rajmahal Royal Residency Project, for his personal use - Section 21(a)(1) of the Consumer Protection Act, 1986 - HELD THAT - Admittedly, the Complainant invested the amount in the project as a partner. Subsequently the Complainant withdrew as a partner and requested Opposite Party No.2 for refund of his investment amount with interest. As Opposite Parties failed to refund the amount, the Complainant entered into an agreement dated 21.11.2006 wherein he was promised that he would be given a duplex flat in the project against his money invested in the project. As the project got delayed, the Complainant sought refund of the amount invested by him. The Complainant made investment of his money as a partner in the project and now he is seeking refund of that investment amount. The entire transaction between the Complainant and the Opposite Parties is commercial in nature. Refund of the amount sought by the Complainant is only extension of initial investment made by him, which is purely commercial in nature - By the Complainant s own admission, vide settlement dated 21.11.2016 the said amount was agreed to be accounted against the contractual promise for delivery to the Complainant of a duplex flat. The amount paid alongwith accrued interest was the consideration for the flat and the debt was discharged by the Opposite Parties through the promise to deliver the duplex flat to the Complainant. Entering into agreement for a duplex flat is only a sequence for realizing the invested amount with interest. Claim made by the Complainant is only for furtherance of gain for the original investment made. The Complainant being an investor is not a Consumer under the provisions of Consumer Protection Act, 1986. The Consumer Complaint is accordingly dismissed as not maintainable with liberty to the Complainant to approach the appropriate Forum.

Issues:
1. Breach of contract and deficiency of service
2. Barred by limitation under section 24-A of the Consumer Protection Act, 1986
3. Whether the Complainant qualifies as a Consumer under the Consumer Protection Act, 1986

Issue 1: Breach of contract and deficiency of service

The Complainant alleged that the Opposite Parties failed to deliver a residential duplex flat as promised in a Settlement Agreement. Despite repeated assurances, the possession was not handed over. The Complainant invested in a Joint Venture Project but faced issues with the terms and amount changed unilaterally by Opposite Party No.2. The Complainant sought a refund with interest, leading to a Settlement Agreement in 2006 for a duplex flat. However, delays and lack of progress in the project led the Complainant to demand a refund of the full value of the flats with interest and punitive damages. The Opposite Parties defended by claiming no deficiency in service and attributing delays to external factors beyond their control.

Issue 2: Barred by limitation under section 24-A of the Consumer Protection Act, 1986

The Opposite Parties argued that the Complaint was time-barred under section 24-A of the Consumer Protection Act, 1986, as it was filed after 2 years from the alleged cause of action. They contended that there was no consumer-service provider relationship, as the Complainant initially invested for profit and later agreed to take flats for profit as well. The Opposite Parties highlighted the arbitration clause in the registration form and emphasized the need for detailed evidence in the proceedings.

Issue 3: Whether the Complainant qualifies as a Consumer under the Consumer Protection Act, 1986

The Opposite Parties raised a preliminary objection, stating that the Complainant, being a businessman with a history of investments, was acting as a money lender seeking interest on the investment. They argued that the transaction was commercial in nature, with the Complainant seeking a refund as an extension of the initial investment. The Opposite Parties contended that the Complainant, as an investor, did not fall under the definition of a "Consumer" as per the Consumer Protection Act, 1986. The Commission dismissed the Consumer Complaint, deeming it not maintainable and granting the Complainant the liberty to approach the appropriate forum.

This detailed analysis of the legal judgment highlights the issues of breach of contract and deficiency of service, the limitation under the Consumer Protection Act, 1986, and the qualification of the Complainant as a Consumer. The judgment delves into the specifics of the case, the arguments presented by both parties, and the Commission's decision based on the legal framework and evidence provided.

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