Buying Houses for Commercial Purposes?
National Commission’s Stance
of higher returns in future, it becomes essential for the complainant to establish the purpose of his property should there be a dispute. If he is buying the property only to invest in it and sell it in future, then the purpose is certainly commercial and the appeal in forum is not maintainable. However, if an individual is buying the property for his personal use – either he is planning to move into it immediately or in near future – the complaint with respect to that property is maintainable in the consumer forum.
Recently, National Consumer Disputes Redressal Commission refused to entertain a case of ‘deficiency in service’ against a builder for not giving possession in the committed time frame. The Commission had observed that booking of more than one flat or flats in various builders’ schemes is a commercial activity carried out with the purpose of making profit through resale. The intention of the buyer of the property is not to use it for residential purpose. Hence, the commission cannot accept the complainant to be a consumer.
Case to note
In a case between DLF Limited and others versus Abdul Azim and others, in February 2015, the State Commission of Delhi questioned its jurisdiction and maintained that the complainant was not a consumer as the purchase of the flat from DLF Limited was meant for commercial purpose. The Commission pronounced six orders in six individual cases on the same day. Three out of these matters were related to the flats booked by the complainants in Richmond Park Project of DLF Universal Limited. Other three matters related to booking of flats by the same complainants in Regency Park Project of DLF Universal Limited.
As per facts stated in the case, VISBA, a partnership firm where Azim and others were partners, had filed a complaint against DLF Universal for deficiency in services for non-delivery of flats within the specified time. All the three partners had booked flats in various schemes launched by DLF Universal. The developer failed to deliver the flats in the committed timeframe and the partners of the firm filed six complaints against the company.
The National Commission held that if more than one flat was booked with one or more developers, it had to be treated as booking meant for investment purpose even if the nature of property
was residential. The Commission also stated that the state and the district forums had the right to refrain from entertaining