To much of the relief to the flat buyers, the Supreme Court has held that the Consumer Courts have the power to direct the builders to compensate and provide refund to the aggrieved homebuyers, in case the builders falter in delivering possession according to the terms of the Agreement. It was specifically stated in the judgment that:-
"A consumer invoking the jurisdiction of the Commission can seek such reliefs as he/she considers appropriate. A consumer can pray for a refund of the money with interest and compensation. The consumer could also ask for possession of the apartment with compensation."
In the instant case titled Experion Developers Pvt Ltd vs Sushma Ashok Shiroor, two issues were raised for clarification before the Court, they are:-
- Whether the terms of the Apartment Buyers Agreement amount to an 'unfair trade practice' and whether the Commission is justified in not giving effect to the terms of the Apartment Buyer's Agreement as laid down in the Pioneer case?
- Whether the Commission has the power under the Consumer Protection Act, 1986 to direct refund of the amount deposited by the Consumer with interest?
With regard to the first issue, the Court held that indeed the clauses of the ‘Apartment Buyers Agreement’ in this case amount to unfair trade practice as they are one-sided. This entitles the Consumer to seek a refund of the amount along with interest. Upholding the findings of the Commission that a term of the contract will not be final and binding if it is shown that the flatbuters had no other choice than to sign on the dotted line on a contract framed by the builder. Also reiterating this very principle explained in the Pioneer case, the Court held that “The appellant builder could not seek to bind the respondent with such one-sided contractual terms.”
The Court also referred to IREO Grace Realtech (P) Ltd. v. Abhishek Khanna & Ors.[1] wherein it was held that-
“34. We are of the view that the incorporation of such one-sided and unreasonable clauses in the apartment buyer’s Agreement constitutes an unfair trade practice under Section 2(1)(r) of the Consumer Protection Act. Even under the1986 Act, the powers of the consumer fora were in no manner constrained to declare a contractual term as unfair or one-sided as an incident of the power to discontinue unfair or restrictive trade 7 practices. An “unfair contract” has been defined under the 2019 Act, and powers have been conferred on the State Consumer Fora and the National Commission to declare contractual terms which are unfair, as null and void. This is a statutory recognition of a power which was implicit under the 1986 Act.
As on the second issue where it was alleged by the Appellant Developer that since the homebuyer has approached Consumer Commission under the Consumer Protection Act, the provisions of the RERA Act cannot apply. The Appellant Builder claimed to distinguish the Pioneer case on the aforementioned ground.
However, the Court rejected his plea and relied on Imperia Structures Ltd v. Anil Patni & Anr.[2] wherein it has consistently been held by this Court that the remedies available under the provisions of the CP Act are additional remedies over and above the other remedies including those made available under any special statutes; and that the availability of an alternate remedy is no bar in entertaining a complaint under the CP Act.
The Court categorically held that:-
“From the two decisions referred to by us, it is crystal clear that the Consumer Protection Act and the RERA Act neither exclude nor contradict each other. In fact, this Court has held that they are concurrent remedies operating independently and without primacy. When Statutes provisioning judicial remedies fall for construction, the choice of the interpretative outcomes should also depend on the constitutional duty to create effective judicial remedies in furtherance of access to justice. A meaningful interpretation that effectuates access to justice is a constitutional imperative and it is this duty that must inform the interpretative criterion.
When Statutes provide more than one judicial fora for effectuating a right or to enforce a duty-obligation, it is a feature of remedial choices offered by the State for an effective access to justice. Therefore, while interpreting statutes provisioning plurality of remedies, it is necessary for Courts to harmonise the provisions in a constructive manner.”
Therefore making it clear that the Consumer Comission is well within its powers to provide the relief prayed for by the homebuyers. When there is a provision of more than one judicial forums to effectuate a right or to enforce duty obligation, the aggrieved party have the right to choose the forum to seek relief. It is therefore, necessary for the courts to harmoinse the provisions in a constructive manner.
[1] (2021) 3 SCC 241
[2] (2020) 10 SCC 783