FAQIR CHAND GULATI versus UPPAL AGENCIES PVT. LTD. & ANR.

Citation: [2008] 10 S.C.R. 697 · Decided: 10-07-2008 · Supreme Court of India · Bench: R.V. RAVEENDRAN · Disposal: Appeal(s) allowed

Cited by 3 judgment(s) · see the full citation network in Lexace

Judgment (excerpt)

[2008] 10 S.C.R. 697 
) 
FAQIR CHAND GULATI 
A 
v. 
UPPAL AGENCIES PVT. LTD. & ANR. 
(Civil Appeal No. 3302 of 2005) 
JULY 10, 2008 
B 
[R.V. RAVEENDRAN AND LOKESHWAR SINGH 
PANTA, JJ.] 
Consumer Protection Act, 1986: Ss. 2(1)(d)(ii)(g) & (o), 3 
and 14: 
c 
Service - Owner entering into a collaboration agreement 
with a builder for construction of a residential building and 
sharing constructed area - Can owner be termed as Consumer 
and builder as service provider for the purpose of application 
f 
of 1986 Act - Maintainability of complaint under 1986 Act -
0 
Held: Maintainable - There was no provision in the agree-
ment for shared control of management of joint enterprise and 
shared liability for losses - Under the circumstances, State 
Consumer Commission and National Consumer Commission 
erred in assuming that an agreement between landowner and E 
builder for development of property and sharing constructed 
area amount to a joint venture and not an agreement for utiliz-
ing service of the builder for consideration - On facts builder 
is service provider, hence, 1986 Act applicable. 
Building Contract between Landowner and builder -
F 
Breach of conditions - Remedy - Held: Landowner may file 
suit for specific performance of contract or claim damages or 
can approach to Consumer Forum for relief as Consumer 
against a builder, service provider. 
Building Contract - Breach of condition as to supply of G 
.., 
Completion Certificate and C & D Forms, by build.er - Held: 
Builder liable to compensate the Landowner for all loss/dam-
ages for not complyina with the conditions. 
697 
H 
698 
SUPREME COURT REPORTS 
[2008] 10 S.C.R. 
A 
Words & Phrases: 
'Joint Venture' - Ingredients - Discussed. 
The questions which arose for determination before 
the Supreme Court .in the present appeal were as to 
' 
B whether a land owner, who enters into an agreement with 
f 
a builder for Construction of an Apartment and 'for shar-
ing of the constructed area thereof, is a Consumer and 
the builder as a Service provider in terms of provisions 
under the Consumer Protection Act, 1986, and as to 
c whether a complaint seeking delivery of Completion Cer-
tificate and C & D forms in regard to building; against the 
builder is maintainable under the 1986 Act. 
Appellant-Landowner contended that though the 
agreement is captioned as 'collaboration agreement', it is 
D not a joint venture as assumed by the State Commission 
and the National Commission but it is an agreement un-
der which the builder agreed to make a housing construc-
tion for the land owner and therefore, the activity of the 
builder squarely fell within the definition of service; that 
E the agreement did not amount to entering into a joint ven-
ture with the builder to share the profits and losses; and 
that insofar as the term of the agreement relating to con-
struction of the ground floor for his benefit, ·the builder 
was a service provider and he was a consumer. 
F 
Respondent-builder submitted that the agreement 
->t 
was for collaboration in the nature of a joint venture which 
required the owner to contribute the land and the builder 
to contribute the funds for construction of a building and 
thereafter share the construction, that is ground floor with 
G corresponding undivided share in the land to the owner, 
and upper floors with corresponding undivided share in 
the land to the builder, and that it was in the nature of a < 
single business adventure under which the parties agreed 
· to share the benefits; that the builder had paid certain sum 
H to the owner as consideration in addition to agreeing to. 
FAOIR CHAND GULATI v. UPPAL AGENCIES 
699 
PVT. LTD. & ANR. 
give the ground floor of the new building and therefore, A 
the agreement was also in the nature of the agreement of 
sale of undivided share in land by the owner to the builder; 
that the two parties to the agreement were associates to 
carry out a single enterprise or business adventure for 
mutual profit and such a venture resulting in profit for B 
both the parties was not an agreement for providing ser-
vice; that there was no contract for 'house construction', 
nor for sale of a house and therefore, it was not a 'ser-
vice-contract; and that as each party had to discharge 
and fulfill certain obligations towards the other in consid- c 
eration of the other party fulfilling certain obligations, the 
remedy in the event of any alleged breach, is to sue for 
specific performance and/or damages i

Excerpt shown. Read the full judgment & AI analysis in Lexace.