RAMESHWAR PRASAD SHRIVASTAVA AND ORS. versus DWARKADHIS PROJECTS PVT. LTD. AND ORS. on 7 December 2018

ARAMESHWAR PRASAD SHRIVASTAVA AND ORS.

v.

DWARKADHIS PROJECTS PVT. LTD. AND ORS.

(Civil Appeal No. 5802 of 2018)

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DECEMBER 07, 2018

[UDAY UMESH LALIT AND R. SUBHASH REDDY, JJ.]

Consumer Protection Act, 1986: ss. 2(1)(b)(iv), 12(c) and13(6) – Expression in s. 2(1)(b)(iv) “one or more consumers wherethere are numerous consumers having the same interest” –CInterpretation of – Complaint referable to s. 2(1)(b)(iv) – Applicationof Or. 1 r. 8 – Held: Language used and the text in s. 13(6) is clearthat wherever a complaint is filed by a complainant in the categoryreferred to in s. 2(1)(b)(iv)-one or more consumers where there arenumerous consumers having the same interest”, the provisions ofDOr. 1 r. 8 shall apply with the modification that reference to suit ordecree shall be construed as reference to a complaint or order ofthe District Forum – Expression “with the permission of the DistrictForum” as appearing in s. 12(1)(c) must be read along with s. 13(6)– Sections 12(1)(c) and 13(6) are not independent but are to beread together and they form part of the same machinery – Thus, inEconsumer complaints by one or more consumers where there arenumerous consumers having the same interest, it is mandatory togive notice of the institution of the suit to all persons so interestedin accordance with Or. 1 r. 8 – In view thereof, the NationalCommission rightly held that complaint filed by some of theFallottees was not maintainable since there was no applicationu/s. s. 12(1)(c) – Code of Civil Procedure, 1908 – Or. 1 r. 8.

Disposing of the appeals, the Court

HELD: 1.1 The expression appearing in sub-clause (iv) ofSection 2(1)(b) of the Consumer Protection Act, 1986 reads “oneGor more consumers where there are numerous consumers havingthe same interest”. This very expression finds incorporated insub-clause (c) of Section 12(1) with an addition following saidexpression, namely “... with the permission of the District Forum,on behalf of, or for the benefit of, all consumers so interested”.HSection 12(1) thus, in its substantive part says that a complaint

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may be filed with the District Forum by any of the four categoriesas mentioned in sub-clauses ‘a’ to ‘d’. Since sub-clause (c)contemplates filing of such complaint, “… with the permission ofthe District Forum”. The context and in what manner suchpermission is required to be taken in terms of the provisions ofthe Act is available in Section 13(6) of the Act which inter alialays down that where the complaint is referable to Section2(1)(b)(iv), the provisions of Rule 8 of Order 1 CPC, 1908 shallapply subject to the modification that every reference therein toa suit or decree shall be construed as a reference to a complaintor the order of the District forum thereon. The mandate, “shallapply” is quite significant. [Para 11, 12][1128-B-F]

1.3 The language used and the text in s. 13(6) is clear thatwherever a complaint is filed by a complainant in the categoryreferred to in s. 2(1)(b)(iv), the provisions of Order 1 Rule 8shall apply with the modification that reference to suit or decreeshall be construed as reference to complaint or order of theDistrict Forum. The expression “with the permission of theDistrict Forum” appearing in s. 12(1)(c) must be read along withs.13(6) which provides the context and effect to said expression.Sections 12(1)(c) and 13(6) are not independent but are to beread together and they form part of the same machinery.[Para 13][1128-F-H]

1.4 The submission that the expression “one or moreconsumers, where there are numerous consumers having the sameinterest” may be given widest possible interpretation so as tomake the redressal mechanism easy, cost effective and efficacious,cannot be accepted as the language employed in the relevantprovisions is absolutely clear and does not admit of any otherinterpretation. If the submission of the appellants is accepted,the category of persons referred to in Section 13(6) of the Act,with the aid of requisite permission in terms of Order I Rule 8CPC could maintain a class action which may bind similarly placedconsumers but those referred to in Section 12(1)(c) would be adifferent category who would not be bound by the provisions ofOrder I Rule 8 of CPC. In essence a separate category of personsas consumer/consumers would be entitled to maintain an action AB

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Aunder Section 12(1)(c) of the Act. Certainly that is not the intent.If the submission is accepted, it would be going against theexpress mandate of the statute. All that such interpretation wouldhelp achieve for some consumers is to maintain an action in aforum with higher pecuniary jurisdiction where, but for suchcollective cause of action, the action would not lie in such forumBwith higher pecuniary jurisdiction. [Para 14][1129-A-F]

1.6 The National Commission was justified in holdingConsumer Case to be not maintainable. The matters were pendingwith the National Commission for more than three years duringwhich time the pleadings were exchanged and the evidence wasCfiled. In the circumstances, though the view taken by the NationalCommission is upheld, the proper course would be to enable theappellants to approach the concerned State Commission. If theState Commission is so approached, the matter shall not beproceeded de novo but from the stage at which it was before theDNational Commission. [Para 15, 16][1129-F-H; 1130-A-C]

Ambrish Kumar Shukla and others v. FerrousInfrastructure Pvt. Ltd. I (2017) CPJ 1 (NC) –approved.

The Chairman, Tamil Nadu Housing Board, Madras v.ET.N. Ganapathy (1990) 1 SCC 608 : [1990] 1 SCR272 ; Babu Manmohan Das Shah & ors. v. Bishun Das(1967) 1 SCR 836 – referred to.

From the Judgment and Order dated 13.02.2018 of the NationalConsumer Disputes Redressal Commission, New Delhi in ConsumerComplaint Case No.250 of 2013.

With

HCivil Appeal No. 9162 of 2018.

RAMESHWAR PRASAD SHRIVASTAVA v. DWARKADHISPROJECTS PVT. LTD.

Ms. Priyanjali Singh, Rahul Rathore, K. K. Shukla, Advs. for theAppellants.

V. V. Manoharan, Nityanand Singh, Ajay Kumar Talesara, Advs.for the Respondents.

The Judgment of the Court was delivered by UDAY UMESH LALIT, J.

1. These appeals under Section 23 of the Consumer ProtectionAct, 1986 (hereinafter called ‘the Act’) are directed against the judgmentsand orders dated 13.02.2018 and 08.08.2018 passed by the NationalConsumer Disputes Redressal Commission, New Delhi (‘the NationalCommission’ for short) dismissing Consumer Case Nos.250 of 2013 and43 of 2014 as not maintainable.

2. An advertisement campaign was started by the first respondentsometime in 2006-2007 for sale of apartments in a group housing projectcalled “Aravali Heights” located at Sector-24, Dharuhera, Haryana.Various interested persons booked their apartments and entered intobuilder-buyer agreements. Clause 11 of such typical agreement providedthat the possession would be delivered by the first respondent withinthree years. The time specified for delivery thus expired in the year2010 but no possession was offered within the stipulated time. It appearsthat letters were received by various such buyers from April, 2012onwards asking for payment of final instalment connected with deliveryof possession. Various buyers found that the apartments were nothabitable at all and the infrastructure such as roads, water supply,sewerage, storm water drain, fire fighting system, electricity were notconstructed or made functional. Some of the buyers therefore filed CivilWrit Petition No.25054 of 2014 in the High Court of Punjab and Haryanawhich was disposed of by the High Court directing said petitioners tomake appropriate representation to the competent authority. It furtherappears that thereafter detailed representations were made and an ordercame to be passed by the concerned directorate which was thenchallenged by certain allottees by filing Civil Writ Petition No.26358 of2016.

3. At this stage 19 such allottees came together and filed a jointcomplaint being Consumer Case No.250 of 2013 on 06.08.2013 in theNational Commission praying following reliefs:

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“1. For delayed possession, this Hon’ble commission may directthe Respondent No.1 to provide a tower-wise schedule forcompletion and handing over the possession of all the flats in the“Aravali Heights” Multi-storeyed Group Housing Complex) locatedat Sector 21, Dharuhera on the basis of current progress &development activities.

Direct the Respondent No.1 to provide tower-wise constructionstatus achieved so far for each tower in the complex withcorresponding dates of achieving completion and an honest andlogical tower-wise details/list of unfinished construction tasks andcorresponding schedule of completion thereof.

Payment of penalty @ 36 per cent per annum, compoundedannually (at the prevailing market rate) be imposed on the totalamount paid to the builder so far by the apartment buyers and bedirected to be paid immediately or at the time of possession to becalculated on the basis explained in the complaint.

2. Declare that the demand raised by the Respondent No.1 forthe enhanced/extra EDC by including interest thereon as null andvoid.

Direct the Respondent No.1 to provide details of the initialEDC and EDC Charge and Calculations thereof in terms of thelatest directive/memo issued by the official Respondents includingthe status of its payment by the Builder to the DGTCP – Haryanaincluding their payments by the Respondent No.1 to the DGTCP– Haryana.

Direct the builder to raise fresh/rectified demand bills/lettertowards EDC Charges after addressing the stated issues-supra.Direct the adjustment of the extra amounts paid by some of theBuyers against the EDC with interest @ 24% thereon against thefresh computations/bills raised as above.

Direct the Respondent No.1 to maintain transparency in thematter of payment of EDC Charges to the Authorities by displayingthe status on their Website so as to restore Buyer Confidence.

3. Direct the Respondent No.1 to refund the open stilt carparking charges in the sum of Rs.75,000/- to Rs.1,50,000/- to thebuyers and the community building membership charges – these being not saleable and part of common areas and not belonging tothe Respondent No.1

4. Direct the Respondent No.1 to refrain from raising illegaldemands of new PLC and immediately withdraw their demandletters to customers of some of the units demanding new PLCunder filmsy grounds.

Direct the Respondent No.1 to refund with 36% interest thePLC money claimed from all those consumer/Complainants whoseflats have ceased to remain Green Facing/falling under PLC ofGreen facing.

5. Direct the Respondent No.1 to refrain from raising illegaldemands of the additional electricity charges, and to immediatelywithdraw their demand letters to customers of some of the unitsdemanding the additional electricity charges under flimsy grounds.

6. Direct the Respondent No.1 to refrain from raising illegaldemands of the electricity charges, as the said demand and theaffixation of the electricity charges is unilateral, and any suchcharges towards the electricity are payable when the possessionis given, and for an amount, which is determined in consultationwith the buyers.

7. Direct the Respondent No.1 to refrain from raising illegaldemands of the Maintenance Charges, as the said charges arepayable when the possession is given to the buyers aftercompleting the flat in all respect.

8. Direct the Respondent No.1 to pay penalty for the mentalharassment caused to the Complainants @ 10,00,000/- (RupeesTen lakhs) per Complainant).

9. Direct the Respondent No.1 to pay costs towards Legalexpenditure @ Rs.50,000/- (Rupees Fifty Thousand) perComplainant.

10. Direct the Respondent No.1 to complete the project andthe flats with all the amenities and facilities including waterconnection, electricity connection, power back up, roads, park,parking space, club house, street lighting, sewage drains, rainwaterdrains, firefighting system etc.

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A11. Declare the aforesaid legal omissions and commissions asamounting deception, deficiency in service and amounts to unfairtrade practice together with monetary compensation/penalty/etc.as prayed in the complaint for the gross mental tension andharassment.”

B4. The National Commission issued notice on 23.08.2013,whereafter the first respondent put in appearance and filed its writtenstatement. After exchange of pleadings, the evidence was also completed.After about 20 hearings in the matter, by order dated 25.02.2016 thecase was fixed for final arguments.C5. On 07.10.2016 a Bench of three Members of the National

C5. On 07.10.2016 a Bench of three Members of the NationalCommission delivered judgment in Ambrish Kumar Shukla and othersv. Ferrous Infrastructure Pvt. Ltd.[1] while answering reference madeto the larger Bench of the National Commission. One of the pointswhich was referred to the larger Bench of the National Commissionwas as under:D

“(i) Whether a complaint under Section 12(1)(c) of the ConsumerProtection Act filed on behalf of or for the benefit of only some ofthe numerous consumers having a common interest or a commongrievance is maintainable or it must necessarily be filed on behalfof or for the benefit of all the consumers having a common interestEor a common grievance against same person(s)”

6. After considering the relevant provisions of the Act namelySection 2(1)(b) defining the expression “complainant”, Section 12(1) andSection 13(6) of the Consumer Protection Act, 1986 (‘The Act’, forshort) as well as the provisions of Order I Rule 8 of Code of CivilFProcedure (‘CPC’, for short) and a decision of this Court in TheChairman, Tamil Nadu Housing Board, Madras v. T.N. Ganapathy[2]the larger Bench of the National Commission held as under:

“……………The primary object behind permitting a class actionsuch a complaint under Section 12(1)(c) of the ConsumerGProtection Act being to facilitate the decision of a consumer disputein which a large number of consumers are interested, withoutrecourse to each of them filing an individual complaint, it isnecessary that such a complaint is filed on behalf of or for the 1I (2017) CPJ 1 (NC)H2(1990) 1 SCC 608

RAMESHWAR PRASAD SHRIVASTAVA v. DWARKADHISPROJECTS PVT. LTD. [UDAY UMESH LALIT, J.]

benefit of all the persons having such a community of interest. Acomplaint on behalf of only some of them therefore will not bemaintainable. If for instance, 100 flat buyers/plot buyers in aproject have a common grievance against the builder/Developerand a complaint under Section 12(1)(c) of the Consumer ProtectionAct is filed on behalf of or for the benefit of say 10 of them, theprimary purpose behind permitting a class action will not beachieved, since the remaining 90 aggrieved persons will becompelled either to file individual complaints or to file complaintson behalf of or for the benefit of the different group of purchasersin the same project. This, in our view, could not have been theLegislative intent. The term ‘persons so interested’ and ‘personshaving the same interest’ used in Section 12(1)(c) mean, thepersons having a common grievance against the same serviceprovider. The use of the words “all consumers so interested” and“on behalf of or for the benefit of all consumers so interested”, inSection 12(1)(c)(d) leaves no doubt that such a complaint mustnecessarily be filed on behalf of or for the benefit of all the personshaving a common grievance, seeking a common relief andconsequently having a community of interest against the sameservice provider.

7. The aforesaid Consumer Case No.250 of 2013 was thereaftertaken up for consideration. The National Commission observed certainfactual developments in the matter as under:

“4. A perusal of the record clearly establishes that at the time offiling of this Complaint, no application under Section 12(1)(c)seeking permission to file joint Complaint had been filed by theComplainants, though there were 19 Complainants in thisComplaint. Thereafter, an I.A.No.12680 of 2017 has been filedby the Complainants seeking amendment of the Complaint. Thesaid application also contained an Application under Section12(1)(c) of the Act.

5. Ms. Priyanjali Singh, Advocate for the Complainants at thetime of arguments in this case, on instructions, stated that theComplainants did not wish to press I.A.No.12680 of 2017 seekingamendment of the Complaint and requested the Complaint shouldbe dealt with as filed earlier. Hence, I.A.No.12680 of 2017 wasdismissed as not pressed.”

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A8. It was observed that since there was no application under Section12(1)(c) of the Act, in view of the decision rendered by larger Bench ofthe National Commission in Ambrish Kumar (supra), the complaint inthe instant case was not maintainable. The National Commission thusby its order dated 13.02.2018 dismissed the aforesaid Consumer CaseNo.250 of 2013 as not being maintainable. Similarly, by order datedB08.08.2018 the National Commission dismissed Complaint Case No.43of 2014 preferred by 4 buyers in respect of same project of the firstrespondent as not being maintainable.

9. These appeals thus question the correctness of the decisions ofthe National Commission and raise issues concerning maintainability ofCthe complaints. At this stage we may extract the relevant provisions ofthe Act.

“Section 2(1) In this Act, unless the context otherwiserequires, - D(a) ………

(b) “complainant” means-

(i) a consumer; or

(ii) any voluntary consumer association registered underthe Companies Act, 1956 (1 of 1956) or under any otherElaw for the time being in force; or

(iii) The Central Government or any State Government; or

(iv) One or more consumers, where there are numerousconsumers having the same interest; F(v)In case of death of a consumer, his legal heir orrepresentative; who or which makes a complaint; Section 12. Manner in which complaint shall be made –(1) A complaint in relation to any goods sold or delivered oragreed to be sold or delivered or any service provided orGagreed to be provided may be filed with a District Forumby- (a)The consumer to whom such goods are sold or delivered oragreed to be sold or delivered or such service provided oragreed to be provided;H

(b) Any recognised consumer association whether the consumerto whom the goods sold or delivered or agreed to be sold ordelivered or service provided or agreed to be proved is amember of such association or not;

(c) One or more consumers, where there are numerousconsumers having the same interest, with the permission ofthe District Forum, on behalf of, or for the benefit of, allconsumers so interested; or (d)The Central Government or the State Government, as thecase may be, either in its individual capacity or as arepresentative of interests of the consumers in general.

Section 13. Procedure on admission of complaint … … …

(6) Where the complainant is a consumer referred to insub-clause (iv) of clause (b) of sub-section (1) of section 2,the provisions of rule 8 of Order I of the First Schedule tothe Code of Civil procedure, 1908 (5 of 1908) shall applysubject to the modification that every reference therein toa suit or decree shall be construed as a reference to acomplaint or the order of the District Forum thereon.”

10. We heard Ms. Priyanjali Singh, learned Advocate in supportof the appeals and Mr. V.V. Manoharan, learned Advocate for the firstrespondent. According to Ms. Singh, the definition of the Complainantas found in Section 2(1)(b) permits even a voluntary consumer associationto espouse the cause of aggrieved party/parties. In her submission theexpression “one or more consumers, where there are numerousconsumers having the same interest” ought to be given widest possibleinterpretation so as to sub-serve the underlying objectives of the Act andto make the redressal mechanism easy, cost effective and efficacious.She further submitted that in cases having large number of apartmentholders, if only some of them approach the consumer forum, theirgrievance redressal ought not to be forced to go through the mechanicsof Section 13(6) of the Act read with the provisions of Order 1 Rule 8CPC. According to her any such insistence would render the remedyexorbitant as cost required for newspaper publication itself would bequite prohibitive. On the other hand, Mr. Manoharan, learned Advocate A

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Afor the first respondent, submitted that the view taken by the Commissionin Ambrish Kumar (supra) was correctly and rightly applied by theCommission in the present case. He further submitted that such viewwas the only possible view, going by the text of the relevant provisions.

11. A closer look at Section 2(1)(b) would show that under sub-Bclause (i) it is the consumer himself, as aggrieved person who could bethe Complainant and maintain an action. Under sub-clause (ii), a voluntaryorganization or association may espouse the cause of such aggrievedperson. Under sub-clause (iii) either the central government or the stategovernment may take-up the matter as complainant. We are, however,concerned with the expression appearing in sub-clause (iv) which readsC“one or more consumers where there are numerous consumers havingthe same interest”. This very expression finds incorporated in sub-clause (c) of Section 12(1) with an addition following said expression,namely “….. with the permission of the District Forum, on behalf of, orfor the benefit of, all consumers so interested”.

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12. Section 12(1) thus in its substantive part says that a complaintmay be filed with the District Forum by any of the four categories asmentioned in sub-clauses ‘a’ to ‘d’. Since sub-clause (c) contemplatesfiling of such complaint, “….. with the permission of the District Forum”,we will have to see the context and in what manner such permission isErequired to be taken in terms of the provisions of the Act. The answeris available in Section 13(6) of the Act which inter alia lays down thatwhere the complaint is referable to Section 2(1)(b)(iv), the provisions ofRule 8 of Order 1 of the First Schedule to the CPC, 1908 (Act 5 of1908) shall apply subject to the modification that every reference thereinto a suit or decree shall be construed as a reference to a complaint orFthe order of the District forum thereon. The mandate, “shall apply” isquite significant.

13. The language used and the text in Section 13(6) is clear thatwherever a complaint is filed by a complainant in the category referredto in Section 2(1)(b)(iv), the provisions of Order 1 Rule 8 CPC shallGapply with the modification that reference to suit or decree shall beconstrued as reference to a complaint or order of the District Forum.The expression “with the permission of the District Forum” as appearingin Section 12(1)(c) must be read along with Section 13(6) which providesthe context and effect to said expression. In our view Sections 12(1)(c)Hand 13(6) are not independent but are to be read together and they formpart of the same machinery.

14. It is however submitted that the expression “one or moreconsumers, where there are numerous consumers having the sameinterest” may be given widest possible interpretation so as to make theredressal mechanism easy, cost effective and efficacious. We are afraidwe cannot accept such contention as the language employed in therelevant provisions is absolutely clear and does not admit of any otherinterpretation. It was laid down by this Court in Babu Manmohan DasShah & ors. v. Bishun Das[3]as:- “The ordinary rule of construction is that a provision of a statutemust be construed in accordance with the language used thereinunless there are compelling reasons, such as, where a literalconstruction would reduce the provision to absurdity or preventthe manifest intention of the legislature from being carried out.”

If we accept the submission of the appellants, the category ofpersons referred to in Section 13(6) of the Act, with the aid of requisitepermission in terms of Order I Rule 8 of the CPC could maintain a classaction which may bind similarly placed consumers but those referred toin Section 12(1)(c) would be a different category who would not bebound by the provisions of Order I Rule 8 of CPC. In essence a separatecategory of persons as consumer/consumers would be entitled to maintainan action under Section 12(1)(c) of the Act. In our considered view thatcertainly is not the intent. If we accept the submission, we would begoing against the express mandate of the statute. All that suchinterpretation would help achieve for some consumers is to maintain anaction in a forum with higher pecuniary jurisdiction where, but for suchcollective cause of action, the action would not lie in such forum withhigher pecuniary jurisdiction.

15. We, therefore, find that the view taken by the NationalCommission in the case of Ambrish Kumar (supra) is consistent withthe text of the provisions and is the correct view. The NationalCommission, in the present case, was therefore justified in holdingConsumer Case Nos. 250 of 2013 and 43 of 2014 to be not maintainable.

16. During the course of hearing we had asked Ms. Singh, learnedcounsel if the appellants were willing to proceed with the requirementsunder Section 13(6) of the Act and take appropriate steps as mandatedunder Order 1 Rule 8 CPC. She, however, responded that the entire A

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Aprocess being prohibitive in terms of cost, her clients were unwilling toproceed in that behalf. It must however be noted that the matters werepending with the National Commission for more than three years duringwhich time the pleadings were exchanged and the evidence was filed.In the circumstances, though we uphold the view taken by the NationalCommission, the proper course would be to enable the appellants toBapproach the concerned State Commission. If the State Commission isso approached, the matter shall not be proceeded de novo but from thestage at which it was before the National Commission. That is to saythat the matter shall be proceeded with on the strength of same pleadingsand the evidence laid before the National Commission.C17. With these observations these Civil Appeals stands disposedof. No costs.

Nidhi Jain

Appeals disposed of.

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