TAMIL NADU HOUSING BOARD & ORS. versus SEA SHORE APARTMENTS OWNERS WELFARE ASSOCIATION

Citation: [2008] 1 S.C.R. 370 · Decided: 09-01-2008 · Supreme Court of India · Bench: C.K. THAKKER · Disposal: Case Allowed
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Judgment (excerpt)

[2008j 1 S.C.R. 370 
;_ 
A 
TAMIL NADU HOUSING BOARD & ORS. 
' 
II. 
SEA SHORE APARTMENTS OWNERS WELFARE 
ASSOCIATION 
(C.A. Nos. 7907-7913 of 2003) 
B 
JANUARY 9, 2008 
(C.K. THAKKER AND P. SATHASIVAM, JJ.) 
). 
' 
Consumer Protection Act, 1986; Ss.2 (1)(0) and 12: 
c 
Services - Housing construction - Construction of flats 
by Housing Board on land acquisitioned by State Government 
- Agreement of sale-purchase of flats entered into between 
respondent-allottees and Housing Board - Ultimate cost of 
flats subject to amount of compensation to be rewarded for 
D the land acquisitioned -
Issuance of allotment letters 
demanding certain additional amount -
Challenged by 
allottees by filing Complaints - State Consumer Commission 
observed that raising of demand of additional amount by the 
Board improper and illegal -Affirmed by National Commission 
E holding that demand of additional amount made on non-
existing grounds -
On appeal, Held: Flats in question 
developed on land acquired by State Government -
Compensation as awarded to land owners enhanced in a 
reference proceedings - Enhanced compensation affirmed 
F by Supreme Court -
In terms of agreement, allottee-
-t 
purchasers agreed to pay the final price of flats as would be 
fixed by the Board - Thus, the Board did not act unfairly/ 
unreasonably- However, the averments made by the allottees 
in the counter affidavit filed in Supreme Court were 
G unnecessary -
All the complaints remitted to State 
Commission to decide issues/disputes in accordance with law 
- Contract - Consent. 
Consumer Protection Act -
State Undertakings/ 
Instrumentalities - Exclusion of service offered by them from 
H 
370 
TAMIL NADU HOUSING BOARD & ORS. v. SEA 
371 
SHORE APTS. OWNERS WELFARE ASSOCIATION 
l 
-f 
application of the Act - Attempt for -
Held: Must be· A 
discouraged as it would be against the spirit of the Act, a 
benevolent legislation. 
Consumer Redressal Commission - Disputes relating 
to deficiency in service - Consumer Disputes Redressal B 
Commission - Jurisdiction of - Held: The Commission has 
• 
jurisdiction to decide disputes relating to deficiency in service 
l~~ 
as services in terms of s.2(1)(o) of the Act includes housing 
constructiqn as well. 
Words and Phrases: 
c 
'Services' - Meaning of in the context of S.2(1)(o) of the 
Consumer Protection Act. 
State of Tamil Nadu acquired a vast peace of land 
and transferred it to appellant No.1, Tamil Nadu Hou~ing D 
Board, for execution of the south Madras Neighbourhood 
Development Scheme. The Board proposed to construct 
) 
different types of flats under its High Income Group 
Scheme. In order to assess demand from public, it issued 
an advertisement inviting applications for registration E 
under the Scheme. The Board conducted draw for 
allotment of flats on October 15, 1993 and issued 
provisional allotment letters giving tentative cost to 
successful applicants. Allotment letters indicating the final 
cost of the flats were issued by the Board in the year 1994. 
F 
.... 
' 
Later, an agreement was entered into between the Board 
-+ 
and the allottees that .ultimate cost of the flat was subject 
to the. outcome in the land acquisition proceedings and 
possession of flats was given to all the allottees. 
Thereafter the allottees were asked to pay additional 
amount, to which they objected by filing representations G 
to the Board. The Board, however, did not give any 
response. Even subsequent representations were not 
responded by the Board. Aggrieved, the allottees filed 
complaints before the State Consumer Commission 
under Section ·12 of the Consumer Protection Act, 1986 H 
372 
SUPREME COURT REPORTS 
(2008] 1 S.C.R. 
A for direction to the Board to return the additional amount 
...,. 
so demanded and paid by the members with interest 
thereon; that the Board to collect the instalments in 15 
years as per the order of allotment issued earlier; and to 
pay compensation of rupees one lakh for the loss 
B sustained and mental agony suffered by its members. The 
State Commission allowed all the complaints quashing 
the demand made by the Board. Appeals filed by the Board 
_.,.\ 
against the order of the State Commissions were 
.. 
dismissed by the National Commission. Hence the 
c present appeals filed by the Board. 
Appellant-Board contended that the Commissions 
were clearly in error in invoking the provisions of the 
Consumer Protection Act and in observing that there was 
'deficiency in service'; that dis
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