Mr. Y. Krishan, Member?
These are three appeals filed by the same appellant-M/s. Skipper Towers Pvt. Ltd. against the order of 26th March, 1992 in Case No. 217/91 The State Commission had also ordered that same order would dispose of cases No. 218/91 (Smt Savitri Devi v. Skipper Constructions & Anr.) and 219/91 (R. K. Gupta v. Skipper Constructions & Anr.). Consequently I am disposing of these appeals by a common order.
2. The three respondents here, were complainants, before the State Commission and the appellant was Opposite Party. They would be referred to as such in this order.
3. The Complainants had entered into contracts with the Opposite Party in 1982 for purchase of commercial space-flats /office space and shops in the multi-storeyed commercial complex, Yusuf Sarai, New Delhi which the Opposite Party was to build. For this purpose the Complainants had paid the following amounts to the Opposite Party-Builder:
1. Shri A.P. Gupta (Respondent - Rs. 2,05,200/-Complainant) in F.A. No. 164/92
2. Smt. Savitri Devi (Respondent- Rs. 2,23,398/-Complainant) in F.A. No. 165/92
3. Shri R.K. Gupta, (Respondent - Rs. 1,70,208/-Complainant) in F.A. No. 166/92
The above amounts were paid by the Complainants during 1988-1990.
4. As observed by the State Commission in its order, the shops as also commercial complex i.e. offices-have not been fully constructed and the question of delivery of possession of the same to the Complainants did not arise. The State Commission, therefore, held that in these circumstances the
Complainants were entitled to refund of the amount deposited by each of the Complainants.
5. In addition the State Commission awarded compensation by way of damages for breach of contracts to the Complainants. Considering the very high increase in the price of housing properties during the last one decade, the State Commission awarded damages one-and-half times the amount deposited viz. Rs. 3.07 lakhs in Appeal No. 164, Rs. 3.35 lakhs in Appeal No. 165 and Rs. 2.55 lakhs in Appeal No. 166.
6. The order of the State Commission has been challenged by the Appellant-Opposite Party on various grounds. The principal challenge is that the Respondent-Complainants are not consumers as defined under Consumer Protection Act, that the shops and commercial spaces were to be purchased for commercial purpose and that there was no sale of goods nor was any service rendered.
7. The Appellant-Opposite Party has further submitted that the Respondent-Complainants are brokers engaged in the business of purchase and sale of properties, they are property agents who purchase properties at nominal price for the purpose of speculation, that they are in the business of real estate, buying and selling properties and construction and that they had also entered into various other transactions for purchase of property in other projects of the Appellant and subsequent sale thereof.
8. The State Commission has repelled the challenge by the Appellant-Opposite Party on the question of jurisdiction viz. that there has been no sale of goods nor has any service been rendered and therefore, the Appellant-Opposite Party is not liable to be arraigned before the Consumer Forums. The State Commission has cited the order of this Commission in U.P. Avas Evam Vikas Parishad v. Garima Shukla & Etc. in support of its decision. We may also observe that the Hon'ble Supreme Court of India by its judgment in appeal of U.P. Avas Evam Vikas Parishad has also upheld the order of this Commission (Civil Appeal No. 6237 of 1990 Lucknow Development Authority v. M.K. Gupta with S.L.P. (C) Nos. 659/91, 16842/92; CA. Nos. 3963/89, 5534/90, 6236/90, 5257/90, 2954-59/92 decided on 5.11.93). In the result it has been held by the Apex Court that Builders of houses etc. clearly render service to the buyers in the matter of housing construction and therefore, are liable under the Consumer Protection Act.
9. The only point that has not been considered and needs to be considered is whether a middle man or Estate Agent who is merely buying or selling properties for profit, who does not buy a property for his own use or consumption, whether such a property be for a commercial purpose or not, but is buying or selling property itself and who does not enjoy that property as a buyer, can such a person be deemed to be a consumer under the Consumer Protection Act? In appreciating this question the following facts are relevant:
1. All the Respondent-Complainants in this case belong to one family and reside at the same place: W-56, G.K. II, New Delhi. One of the Complainants Shri A.P. Gupta is the son of Shri R.K. Gupta, Smt. Savitri Gupta, one of the Complainants is the wife of Shri R.K. Gupta, and Shri R.K. Gupta himself is also one of the Complainants.
2. In the counter affidavit filed before the State Commission the Respondents-Complainants had explained as under:
"Because assuming without admitting that the respondent may be a broker and engaged in the business of sale or purchase of the properties, the bar contained in Section 2(l)(d)(i) ?But does not include a person who obtains such goods for resale or for any commercial purposes' is not applicable in this case for the simple reason that there is no contract on record between the appellant and the respondent that
respondent may have booked the premises in project namely 12, C.C. Yusuf Sarai, New Delhi for the purpose of resale or for the commercial purposes that is akin to resale. However, if the buyer of a flat/shop/commercial space lets it out to the tenants the same shall not be covered by the aforesaid exception. Further it is submitted that non-delivery of possession of booked space is a merely breach of contract which is equally covered by the Contract Act and the Consumer Protection Act, 1986 is applicable."
3. The Appellant-Opposite Party has submitted evidence that the parties are only buying and selling properties. One of the Respondents-Complainants Smt. Savitri Devi had booked flat No. UB-6 on Upper Basement Floor in building No. 22 at Barakhamba Road in 1981 for Rs. 82,125/- and had sold the same to M/s. Unita World Travels in 1984 for a total sum of Rs. 1,08,375/-making profit of Rs. 26,250/-.
10. The above facts speak for themselves. The Respondents-Complainants are not buyers of properties for self use (whether for residential or commercial purpose) but are merely property dealers who buy and sell flats etc. In my opinion there could be no deficiency in service under the Consumer Protection Act in relation to such buyers of properties. It is not necessary for me to go into the question whether there could be a deficiency in service when there is a breach and recission of a contract and the property is not delivered nor any service rendered? In short, whether non-performance of contract as such would constitute deficiency in service? It is established in this case that the Respondents-Complainants are only property dealers who only undertake buying and selling of properties but not enjoying them. In other words the Respondents-Complainants may be de-jure buyers and sellers of properties, but are de facto property agents who act on behalf of the buyers and sellers and not true buyers themselves. In my opinion
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they are not consumers as defined under the Consumer Protection Act. The Appellant may be guilty of gross breach of contracts but for that he cannot be hauled up before Consumer Forums. The appeals, therefore, succeed and orders of the State Commission are set aside. There is not order as to costs. Mr. Justice V. Balakrishna Eradi, President?The above order recorded by Shri Y. Krishan, Member, gives the relevant facts of the case. It is not, therefore, necessary to recite them again. In our opinion there is no merit in any of the points urged on behalf of the Appellants. We are in full agreement with the reasoning and conclusions recorded by the State Commission. The appeals are accordingly dismissed. The Appellants shall pay to the Respondents Rs. 2,500/- by way of costs in each of the appeals.