SC to the res­cue of group hous­ing so­ci­ety mem­bers

So­ci­eties can­not over­look re­spon­si­bilites as their mem­bers are cov­ered by Con­sumer Pro­tec­tion Act, rules SC

HT Estates - - HTESTATES - Su­nil Tyagi

It is a set­tled law that con­sumer courts can de­cide on griev­ances against builders or de­vel­op­ers in whose projects the al­lot­tees have booked apar t ments. The Supreme Court, in the case of Viren­der Jain vs Alak­nanda Co­op­er­a­tive Group Hous­ing So­ci­ety Lim­ited and oth­ers, set at rest the is­sue of con­sumer courts hav­ing ju­ris­dic­tion in cases where a mem­ber has a griev­ance against the co­op­er­a­tive group hous­ing so­ci­ety he or she be­longs to de­spite the Co­op­er­a­tive So­ci­ety Act hav­ing a spe­cific rem­edy.

In the case, the com­plainants were en­rolled as mem­bers of the Alak­nanda Co­op­er­a­tive Group Hous­ing So­ci­ety Lim­ited Gur­gaon. They had ap­plied for type ‘A’ flats which were be­ing con­structed by the so­ci­ety on land al­lot­ted to it by the au­thor- ity. The com­plainants had de­posited pay­ment for the prop­erty in in­stal­ments over a pe­riod of around eight years. There­after, the hous­ing so­ci­ety re­turned the amount and in­di­rectly ter­mi­nated their mem­ber­ship on the grounds of their fail­ing to de­posit the in­stal­ments of the first and sec­ond stage of con­struc­tion and the in­stal­ment of the cost of land al­lot­ted by the author­ity to the so­ci­ety.

The com­plainants filed a plea with the Dis­trict Con­sumer Dis­putes Re­dres­sal Fo­rum, Gur­gaon, under Section 12 of the Con­sumer Pro­tec­tion Act, 1986. The hous­ing so­ci­ety claimed that the com­plainants did not fall within the def­i­ni­tion of ‘con­sumer’ as per the Con­sumer Pro­tec­tion Act, 1986, and that the only rem­edy they had was to file a pe­ti­tion as per the Haryana Co­op­er­a­tive So­ci­eties Act, 1984, which was a spe­cial statute.

The Dis­trict Fo­rum over­ruled the so­ci­ety’s ob­jec­tion and held that the rem­edy pro­vided under the Haryana Co­op­er­a­tive So­ci­eties Act, 1984, was an ad­di­tional rem­edy and it was not in dero­ga­tion to rem­edy pro­vided under other acts. It is the choice of the com­plainants to ei­ther avail of the rem­edy under the Con­sumer Pro­tec­tion Act or any other ap­pli­ca­ble law. How­ever, Dis­trict Fo­rum dis­missed the com­plaint on the ground that there was no de­fi­ciency in the ser­vice pro­vided by the hous­ing so­ci­ety.

The com­plainants ap­pealed to the State Com­mis­sion and t here­after t o t he Na­tional Com­mis­sion, but i n both fo­rums their ap­peals were not en­ter­tained on the ground that the com­plainants did not come­within the purview of the term ‘con­sumer’ as per the Con­sumer Pro­tec­tion Act, 1986. There­after, the com­plainants ap­proached the Supreme Court.

The apex court dis­cussed its de­ci­sion in the Luc­know De­vel­op­ment Author­ity vs MK Gupta (1994) case wherein it was ob­served that if “… author­ity un­der­takes to con­struct build­ing or al­lot houses or build­ing sites to cit­i­zens ei­ther as amenity or as ben­e­fit then it amounts to ren­der­ing of ser­vice and will be cov­ered in the ex­pres­sion ‘ser­vice made avail­able to po­ten­tial users’. A per­son who ap­plies for al­lot­ment of a build­ing site or for a flat con­structed by the de­vel­op­ment author­ity or en­ters into an agree­ment with a builder or a con­trac­tor is a po­ten­tial user and na­ture of trans­ac­tion is cov­ered in the ex­pres­sion ‘ser­vice of any de­scrip­tion’. It fur­ther in­di­cates that the def­i­ni­tion is not ex­haus­tive. The in­clu­sive clause suc­ceeded in widen­ing its scope but not ex­haust­ing the ser­vices which could be cov­ered in the ear­lier part. So any ser­vice – ex­cept when it is free of charge or under a con­straint of per­sonal ser­vice - is in­cluded in it.”

On the ba­sis of the judg­ments in the above men­tioned cases, the apex court held that the com­plainants who had de­posited in­stal­ments for the flats be­ing con­structed by the hous­ing so­ci­ety were cov­ered by the def­i­ni­tion of ‘con­sumer’ as per the Con­sumer Pro­tec­tion Act and it set aside the or­ders passed by the Na­tional Com­mis­sion and t he State Com­mis­sion and re­manded the com­plaints to the State Com­mis­sion for ad­ju­di­ca­tion.

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