NEW DELHI: Homebuyers can raise complaints regarding deficiencies in services even after taking possession of a flat, as per a ruling by the Supreme Court. The court affirmed that homebuyers have the right to approach consumer forums for compensation related to delayed possession, irrespective of having already received the flat.
The Supreme Court overturned a decision by the National Consumer Disputes Redressal Commission (NCDRC), which had stated that a homebuyer loses consumer status upon receiving possession and therefore cannot claim compensation for delays. The court clarified that any arbitration clause in the agreement will not prevent homebuyers from seeking resolutions in consumer forums.
A plea from a homebuyer who received a flat in a Dwarka housing project—22 years after possession—was upheld by a bench of Justices Vikram Nath and V Mohana, who stated that the NCDRC’s reasoning was flawed.
“The appellant’s complaint was not solely about the delivery of possession. His grievance concerns the delay in handing over the flat, for which he seeks compensation. A claim for such compensation arises from the period before possession, meaning that receiving possession does not nullify a homebuyer’s right to pursue claims for delays,” the bench elaborated. They reinstated the 2005 complaint filed by the homebuyer with the district consumer forum, instructing it to resolve the matter within a year, determining if there was a delay and if it was attributable to the developers.
“The appellant’s claim for compensation regarding the delay in possession remains unresolved and needs examination. Likewise, the defense presented by the respondent has not yet been scrutinized in detail. These issues cannot simply be dismissed by arguing that the appellant is no longer a consumer because possession was delivered before filing the complaint,” the bench stated.
In addressing the precedence of the arbitration clause or the Consumer Protection Act, the bench noted that the 1986 Act provides a unique and additional remedy for consumers, which cannot be overridden by referencing any arbitration agreements between the concerned parties.
“Once the mechanism is properly initiated and the complaint accepted, the consumer cannot be dismissed from that forum just because the agreement contains an arbitration clause. A private agreement cannot undermine the operation of a statutory remedy that Parliament has explicitly established as supplementary to other remedies under Section 3 of the 1986 Act,” they concluded.
