Caveat Vendor. How the court demolished a builder’s case

If you scan through the multitude of consumer complaints filed every year, you’ll be happy to note that the courts, by and large, took up for consideration the complaints filed by harassed consumers. While justice has not always been quick, people have certainly got relief in the case of genuine complaints.

In this column, we chronicle recent rulings by consumer courts in India to give you an idea of the nature of complaints and how they were dealt with. Flagging off the column, we take up a tussle between a big realty firm and a buyer.

In this particular instance, Hari Singh applied for a flat (1,760 sq.ft super built-up area) and a parking slot in the New Town Heights DLF project in Sector 90, Gurgaon. He paid ₹5 lakh as booking amount.

But instead of being allotted the apartment he applied for, he was given a different one with two parking slots, in another DLF project in Sector 91. He was also asked to pay ₹10,62,500. Since he was not interested in this flat, he sent a legal notice to DLF New Gurgaon Home Developers (DLF) asking for a refund. When the realtor failed to do so, he filed a complaint with the District Consumer Disputes Redressal Forum in Gurgaon. From here, the case went right up till the National Consumer Disputes Redressal Commission.

All along, DLF contended that the entire matter was the result of only a genuine mistake where the buyer was handed over a wrong application form.

The marketing department had forgotten to strike out ‘Sector 90’ and replace it with ‘Sector 91’ in the form given to Hari.

DLF claimed that booking for the Sector 90 project had already closed on February 7, 2008 — a day before Hari Singh’s application.

Also, due to non-availability of a flat with the dimensions asked for, a larger flat was offered to him.

Letters were sent to inform him of this and for the additional payment.

According to DLF, Hari Singh never objected to the allotment of a larger flat.

It was also alleged that Hari Singh was a speculator (and not a consumer) and when the price of the flat did not appreciate as expected, he wanted to free himself from the contract entered into.

The arguments raised by DLF cut no ice with the court. First, in the absence of any written evidence to prove that the consent of the buyer for accepting a different flat had been taken, it was deficiency in service on DLF’s part.

There was also no evidence to prove that Hari Singh had been told about the non-availability of the flat he’d asked for.

Second, allotment of a larger flat could be considered only a counter-offer and not a concluded contract, unless accepted by Hari Singh.

The realtor, as a result, had no right to forfeit the ₹5 lakh under the terms of the contract.

The speculation argument was overturned too.

The District Forum ordered that Hari Singh be handed over the flat that he had originally applied for with the same conditions within 30 days.

If DLF failed to do so, it would have to refund the booking amount of ₹5 lakh with an annual 12 per cent rate of interest from the date of deposit, which was in February 2008, till its realisation.

The District Forum also ordered compensation of ₹20,000 for mental agony and litigation charges of ₹3,000. DLF appealed against this decision at the Haryana State Consumer Disputes Redressal Commission.

The appeal was dismissed. The realtor followed this up by approaching the National Commission, which similarly dismissed the petition (with a cost of ₹25,000) and upheld the decisions of the earlier forums.

So, if you find yourself in similar waters, you know what to do!