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Judgment
Deepa Sharma, Presiding Member
The brief facts of the case are that complainant had booked an apartment bearing unit no. SY-B-32-03 in the project 'SKYON' of the opposite party situated at Golf Course Extension Road, Sector 60, Gurugram and made initial payment of Rs.15,00,000/- and an allotment letter dated 14.01.2011 was issued in his favour. A Builder Buyer Agreement was executed on 14.02.2012 and the total consideration amount of the subject flat was Rs. 2,39,89,784/-. Complainant had paid total sum of Rs.2,23,91,480/- on several dates. Certain additional charges were also raised from the complainant. It is submitted that due date of delivery of possession was 42 months with grace period of six months from the date of approval of the building plan. The delivery of the subject flat was not made within the stipulated period. Aggrieved, the complainant has filed the present complaint and has prayed that opposite party be directed to hand over the subject property alongwith delayed compensation containing all the facilities as promised under the Builder Buyer Agreement. In case the opposite party fails to deliver the possession, the direction to refund the principal amount of Rs.2,23,91,480/- be ordered alongwith interest @ 18% p.a. Several other reliefs were also sought in the complaint.
Complaint is contested by the opposite party. Several contentions have been raised. It is, however, not disputed that subject flat was allotted to the complainant and that the complainant had paid sum of Rs.2,23,91,480/-. It is contended that complainant is not a consumer since he already has two residential addresses (i) D-10, Kirti Nagar, Delhi and (2) Jawahar Nagar, Jaipur ( Rajasthan). It is further contended that he is only investor in the subject property and he has also invested in another project of the opposite party in Victory Valley wherein he was allotted apartment no. B-2801. It is contended that he has invested for commercial gains i.e. either by way of income of rent and / or re-sell at an appreciated value. The reasons for delay in the completion of the construction are mentioned in details in the complaint.
In the rejoinder, complainant has submitted that he is not the owner of the properties mentioned by the opposite party in their written statement. Rather those properties are owned by the other members of his extended family and it is submitted that he is a consumer within the meaning of Section 2 (1) (d) of the Consumer Protection Act, 1986 ( in short, the Act).
The parties led their evidences and have furnished their written synopsises.
We have heard the arguments and have perused the relevant record. One of the contention of the complainant is that it is a covered case covered by the order of this Commission dated 06.12.2019 in Consumer Case No. 1062 of 2018 titled Siddharth Vasisht Vs. M/s Ireo Pvt. Ltd. & Ors. It is submitted that appeal filed against the said order was dismissed by the Hon'ble Supreme vide order dated 11.12.2020 in Civil Appeal Diary No (s) 21634 of 2020 and, therefore, order of this Commission has attained finality and it is prayed that similar order shall be passed.
It is argued by the opposite party that complainant is not a consumer. It is submitted that complainant has given his two residential addresses in the complaint. Besides the subject flat, he had also booked a flat in Victory Valley, another project of the opposite party and he had taken possession of said flat no.B-2801 and conveyance deed has also been registered in his favour. It is argued that subject flat has been purchased not for residential purposes but for commercial purpose. It is submitted that since the complainant is not a consumer, complaint is liable to be dismissed.
The admitted facts are that the complainant had booked the subject property with the opposite party and the opposite party had failed to deliver the possession of the subject flat within the stipulated period and on account of this deficiency on the part of the opposite party, the complainant has filed this complaint. In the complaint, complainant has given his two residential addresses. He has also booked one more flat with the opposite party in Victor Valley. The question is does these facts take him out of the definition of 'Consumer' as defined under section 2 (1) (d) of the Consumer Protection Act, 1986 ( in short, the Act)?
Section 2 (1) (d) of the Act defines the term 'consumer' as under:
"consumer" means any person who-
(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly prom-ised, or under any system of deferred payment and includes any beneficiary of such services other than the person who 'hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purposes ;
Explanation .- For the purposes of this clause, "commercial purpose" does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment."
Hon'ble Supreme Court in Laxmi Engineering Works Vs.P.S.G. Industrial Institute 1995 AIR 1428 while discussing the scope of Section 2 (1) (d) of the Act has held as under:
"12. Now coming back to the definition of the expression 'consumer' in Section 2(d) , a consumer means in so far as is relevant for the purpose of this appeal, (i) a person who buys any goods for consideration; it is immaterial whether the consideration is paid or promised, or partly paid and partly promised, or whether the payment of consideration is deferred; (ii) a person who uses such goods with the approval of the person who buys such goods for consideration (iii) but does not include a person who buys such goods for resale or for any commercial purpose. The expression "resale" is clear enough. Controversy has, however, arisen with respect to meaning of the expression "commercial purpose". It is also not defined in the Act. In the absence of a definition, we have to go by its ordinary meaning. "Commercial" denotes "pertaining to commerce" (Chamber's Twentieth Century Dictionary); it means "connected with, or engaged in commerce; mercantile; having profit as the main aim" (Collins English Dictionary) whereas the word "commerce" means "financial transactions especially buying and selling of merchandise, on a large scale" (Concise Oxford Dictionary). The National Commission appears to have been taking a consistent view that where a person purchases goods "with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit" he will not be a "consumer" within the meaning of Section 2(d)(i) of the Act. Broadly affirming the said view and more particularly with a view to obviate any confusion the expression "large-scale" is not a very precise expression the Parliament stepped in and added the explanation to Section 2(d)(i) by Ordinance/ Amendment Act , 1993. The explanation excludes certain purposes from the purview of the expression "commercial purpose" - a case of exception to an exception. Let us elaborate: a person who buys a typewriter or a car and uses them for his personal use is certainly a consumer but a person who buys a typewriter or a car for typing others' work for consideration or for plying the car as a taxi can be said to be using the typewriter/car for a commercial purpose. The explanation however clarifies that in certain situations, purchase of goods for "commercial purpose" would not yet take the purchaser out of the definition of expression "consumer". If the commercial use is by the purchaser himself for the purpose of earing his livelihood by means of self-employment, such purchaser of goods is yet a "consumer". In the illustration given above, if the purchaser himself works on typewriter or plies the car as a taxi himself, he does not cease to be a consumer. In other words, if the buyer of goods uses them himself, i.e., by self- employment, for earning his livelihood, it would not be treated as a "commercial purpose" and he does not cease to be a consumer for the purposes of the Act. The explanation reduces the question, what is a "commercial purpose", to a question of fact to be decided in the facts of each case. It is not the value of the goods that matters but the purpose to which the goods bought are put to. The several words employed in the explanation, viz., "uses them by himself", "exclusively for the purpose of earning his livelihood" and "by means of self-employment" make the intention of Parliament abundantly clear, that the goods bought must be used by the buyer himself, by employing himself for earning his livelihood. A few more illustrations would serve to emphasis what we say. A person who purchases an auto-rickshaw to ply it himself on hire for earning his livelihood would be a consumer. Similarly, a purchaser of a truck who purchases it for plying it as a public carrier by himself would be a consumer. A person who purchases a lathe machine or other machine to operate it himself for earning his livelihood would be a consumer. (In the above illustrations, if such buyer takes the assistance of one or two persons to assist/help him in operating the vehicle or machinery, he does not cease to be a consumer.) As against this a person who purchases an auto-rickshaw, a car or a lathe machine or other machine to be plied or operated exclusively by another person would not be a consumer. This is the necessary limitation flowing from the expressions "used by him", and "by means of self-employment" in the explanation. The ambiguity in the meaning of the words "for the purpose of earning his livelihood" is explained and clarified by the other two sets of words."
From the above, it is apparent that a person who buys a good ceases to be a consumer, if that person indulges itself in commercial activities qua the goods and in case of purchase of residential houses, it can be said that buyer is indulging into the activity of buying / selling the properties and purchased it for that purpose.
It is settled proposition that burden is upon the opposite party to prove that the complainant is indulging in commercial activities of sale and purchase of the flats and that he had booked the subject flat with the intention to sell it to earn profit as part of his commercial activities. This Commission in Kavita Ahuja Vs. Shipra Estate Ltd. and Jai Krishna Estate Developers Pvt. Ltd. 1 (2016) CPJ 131 (NC) has clearly held as under:
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" In the case of the purchase of houses which the service provider undertakes to construct for the purchaser, the purchase can be said to be for a commercial purpose only where it is shown that the purchaser is engaged in the business of purchasing and selling houses and / or plots on a regular basis, solely with a view to make profit by sale of such houses. If however, a house to be constructed by the service provider is purchased by him purely as an investment and he is not undertaking the trading of houses on a regular basis and in the normal course of the business profession or services in which he is engaged, it would be difficult to say that he had purchased houses for a commercial purpose . A person having surplus funds available with him would not like to keep such funds idle and would seek to invest them in such a manner that he gets maximum returns on his investment. He may invest such funds in a Bank Deposits, Shares, Mutual Funds and Bonds or Debentures etc. Likewise, he may also invest his surplus funds in purchase of one or more houses, which is/are proposed to be constructed by the service provider, in the hope that he would get better return on his investment by selling the said house(s) on a future date when the market value of such house (s) is higher than the price paid or agreed to be paid by him. That by itself would not mean that he was engaged in the commerce or business of purchasing and selling the house (s).
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In any case, it is not appropriate to classify such acquisition as a commercial activity merely on the basis of the number of houses purchased by a person, unless it is shown that he was engaged in the business of selling and purchasing of houses on a regular basis . xxxxx...."
It is, therefore, clear that burden is squarely upon the opposite party to prove the fact that complainant is indulging in the business of sale and purchase of the flats. There is no contention in the written version that the complainant is indulging in the business of sale / purchase of the properties. Since the opposite party has failed to discharge this burden, we hold that complainant is consumer within the meaning of Section 2 (1) (d) of the Act.
The complainant has contended that it is a covered case covered under the order of this Commission in the matter of Siddharth Vasisht Vs. M/s Ireo Pvt. Ltd. & Ors.in Consumer Case No. 1062 of 2018 decided on 06.12.2019. This order was upheld in Civil Appeal Diary No (s) 21634 of 2020 by the Hon'ble Supreme Court vide its order dated 11.12.2020. It is, therefore, clear that this order has attained finality and since it is a covered case relating to the same project of the opposite party, all the contentions of the opposite party relating to the reasons for the delay has been rejected in the above case and confirmed on merit by the Hon'ble Supreme Court. As this case is squarely a covered matter, we proceed to grant same relief to the complainant.
While disposing of the Consumer Complaint, following directions are thus issued:
The Opposite Party shall refund the entire principal amount of Rs.2,23,91,480/- to the complainant alongwith compensation in the form of simple interest at the rate of 10.25 % per annum, which is stated to be the interest rate under RERA, in Haryana, in respect of the cases where refund is made to the flat buyer on account of delay on the part of the developer in offering possession of the house, from the date of each payment till the date of refund.
Any compensation paid by the opposite party to the complainant towards delay in completion of the project as per the terms and conditions of the agreement shall be adjusted in the interest amount and the balance interest amount shall be paid to the complainant.
The Opposite Party shall pay sum of Rs.25,000/- as cost of litigation to the complainant.