Ownership of Multiple Houses Does Not Presume Commercial Intent: Delhi State Commission Finds TDI Infrastructure Responsible for Service Deficiency

The Delhi State Commission, under the leadership of Justice Sangita Dhingra Sehgal and Ms. Pinki, ruled that owning multiple houses does not automatically indicate a commercial purpose. The commission further emphasized that the burden of proof regarding the commercial nature of a purchase rests with the builder, requiring the presentation of documentary evidence.

Case Summary

The complainants had booked a three-bedroom apartment in a TDI Infrastructure project at TDI City, making payments totaling Rs. 26,47,852 by 2015, with an additional 10% due upon possession. Despite the possession being scheduled for September 2013, the builder failed to deliver it despite repeated requests and did not compensate for the delay as agreed. The complainants, including a retired government servant who endured mental anguish and financial strain, filed a complaint with the district forum. The forum ruled in favor of the complainants, ordering the builder to refund the principal amount of Rs. 26,47,852 along with 24% interest. Additionally, the builder was directed to pay Rs. 10,00,000 as compensation for mental distress, suffering, and harassment due to deficient service. Dissatisfied with the district forum’s decision, the builder appealed to the State Commission.

Builder’s Arguments

In their appeal, the builder argued that the District Commission overlooked the fact that the respondents were not consumers under the Consumer Protection Act 2019, asserting that the apartment was acquired for commercial use. They further contended that the complainants failed to adhere to the payment schedule and criticized the District Commission for imposing an unjustifiably high rate of interest. Based on these points, the builder requested the reversal of the District Commission’s order.

Findings of the State Commission

The State Commission examined whether the complainants qualified as consumers under the Consumer Protection Act, 2019, referencing relevant legal precedents. Citing the case of Aashish Oberai Vs. Emaar MGF Land Limited, it underscored that ownership of multiple houses does not automatically imply commercial intent. Moreover, in Narinder Kumar Bairwal and Ors. vs. Ramprastha Promoters and Developers Pvt. Ltd., it was established that the builder bears the burden of proving a purchase was for commercial purposes, necessitating documentary evidence.

Addressing the builder’s argument that delayed payments justified the withholding of possession and imposition of high interest rates, the commission noted that the builder itself faced delays in the project timeline. Therefore, the commission dismissed this argument for lack of merit.

The State Commission rejected the appeal and affirmed the order of the District Commission.

Case Caption: M/S TDI Infrastructure Ltd vs. Mr. Ram Adhar & Anr.

Case Number: F.A. No. 326/2023

Posted and reproduced in Public Interest by

Adv. Sulaiman Bhimani Legal Consultant

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