PIONEER URBAN LAND & INFRASTRUCTURE LTD. versus GOVINDAN RAGHAVAN

Citation: [2019] 5 S.C.R. 1169 · Decided: 02-04-2019 · Supreme Court of India · Bench: UDAY UMESH LALIT · Disposal: Dismissed

Cited by 8 judgment(s) · cites 3 · see the full citation network in Lexace

Judgment (excerpt)

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PIONEER URBAN LAND & INFRASTRUCTURE LTD.
v.
       GOVINDAN RAGHAVAN
(Civil Appeal No. 12238 of  2018)
APRIL 02, 2019
[UDAY UMESH LALIT AND INDU MALHOTRA, JJ.]
Consumer Protection Act, 1986 – s.23 – Deficiency of service
– Appellant-Builder launched a residential project and respondent-
flat purchaser entered into an Apartment Buyer’s agreement to
purchase an apartment in the said project for a total sale
consideration of Rs.4,83,25,280/- – As per agreement, the appellant
was to apply for the occupancy certificate within 39 months from
the date of excavation with grace period of 180 days – However,
Appellant-builder failed to apply for occupancy certificate as per
agreement – Consumer complaint filed before the National
Commission – During the pendency of the proceedings, the appellant
obtained the occupancy certificate and pleaded National
Commission to direct the respondent to take possession of the flat –
However, the respondent refused to take possession as there was
an inordinate delay of almost 3 years – National Commission allowed
the consumer complaint and held that respondent could not be
compelled to take possession at such belated stage – Further,
appellant was directed to refund Rs.4,48,43,026 i.e. the amount
deposited by the respondent along with interest @ 10.7% S.I. p.a.
towards compensation – On appeal, held: The respondent-flat
purchaser made out a clear case of deficiency of service on the
part of the appellant-builder – Appellant failed to fulfill his
contractual obligation of obtaining the occupancy certificate and
offering possession of the flat to the respondent within the time
stipulated in the agreement, or within a reasonable time thereafter
– Respondent was justified in terminating the Apartment Buyer’s
Agreement by filing the Consumer Complaint, and cannot be
compelled to accept the possession whenever it is offered by the
Builder – Respondent was legally entitled to seek refund of the money
deposited by him along with appropriate compensation –
Respondent had to also service a loan that he had obtained for
[2019] 5 S.C.R. 1169
1169
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SUPREME COURT REPORTS
[2019]  5 S.C.R.
purchasing the flat by paying interest @10% to the Bank – In the
circumstances, no illegality in the impugned order passed by the
National Commission –  Haryana Real Estate (Regulation And
Development) Rules, 2017 – r.15.
Consumer Protection Act, 1986 – s.2(r) – Unfair and
unreasonable apartment buyer’s agreement – Held: A term of a
contract will not be final and binding if it is shown that the flat
purchasers had no option but to sign on the dotted line, on a contract
framed by the builder – The contractual terms of the Buyer’s
Agreement in the instant case was ex-facie one-sided, unfair and
unreasonable – The incorporation of such one-sided clauses in an
agreement constitutes an unfair trade practice as per s.2(r) of the
Consumer Protection Act since it adopts unfair methods or practices
for the purpose of selling the flats by the Builder.
Dismissing the appeals, the Court
HELD: 1. A term of a contract will not be final and binding
if it is shown that the flat purchasers had no option but to sign on
the dotted line, on a contract framed by the builder. The
contractual terms of the Agreement dated 08.05.2012 are ex-
facie one-sided, unfair, and unreasonable. The incorporation of
such one-sided clauses in an agreement constitutes an unfair trade
practice as per Section 2 (r) of the Consumer Protection Act,
1986 since it adopts unfair methods or practices for the purpose
of selling the flats by the Builder. This Court has no hesitation in
holding that the terms of the Apartment Buyer’s Agreement
dated 08.05.2012 were wholly one-sided and unfair to the
Respondent-Flat Purchaser. The Appellant-Builder could not seek
to bind the Respondent with such one-sided contractual terms.
[Paras 6.7 and 7][1183-B-D]
2. In the present case, the National Commission has passed
an equitable Order. The Commission has not awarded any Interest
for the period during which the Order of stay of cancellation of
the allotment was in operation on the request of the Respondent-
Flat Purchaser. The National Commission has rightly awarded
Interest @10.7% S.I. p.a. by applying Rule 15 of the Haryana
Real Estate (Regulation And Development) Rules, 2017 from
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the date of each installment till 05.02.2017 i.e. till the date after
which the Order of stay of cancellation of the allotment was passed;

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