Laws laid down by supreme court



So far we had been discussing commercial purpose in the light of various judgments pronounced by the apex court because no specific definition has been given in the act .Courts are discussing the matters comparing with self livelihood and often distinguish them on the yardstick of profit and loss, quantum of business etc.In housing matters, property purchased for commercial activities, malls industry etc. are treated out of consumer court jurisdiction they being clearly for commercial purpose. Now the question has been raised on residential property also if they are purchased for earning profit.  With the passage of time now people do invest their money in other than normal business activities and one such area chosen is investing in properties which attracts huge benefits.Property business in touching heights due to this very reason that most of the  buyers are not actual users and actual users are forced to live in rented houses . This is the new investment mode under scan of courts and recently National Commission has refused to entertain a case of deficiency in services to a complainant who has alleged against builder for not giving possession in specific period. Court observed that booking of more than one flat or flats in various builders’ schemes are a commercial activity for the purpose of profit and resale and not for residential purpose.

National commission has decided a case in the matter between DLF Limited&others and Abdul Azam, Abdul Basit, Abdul Waseem, 11(2015) CPJ344 (NC) on 05.02.2015 on the above issue wherein appeals against  six cases decided by the honorable State Commission of Delhi had been filed. The question of jurisdiction of the consumer courts is the main plea contending that  complainant is not a consumer as the purchase of flat was meant for commercial purpose.

Delhi state consumer dispute redressal commission pronounced six orders  in six individual cases on 2.6.2006 .three out of these matters relate to the flats booked by the complainants in Richmond Park Project of DLF Universal Ltd. Other three matters relate to booking of flats by the same complainants in Regency Park Project of the same DLF Universal Ltd.  

The facts as stated in the case are that VISBA is a partnership firm; three partners of the firm are complainants against DLF Universal Ltd for deficiency in services for non delivery of flats within specific time. All the three partners booked flats in various schemes launched by DLF Universal Ltd namely  Richmond Park Project of DLF Universal Ltd.and  in Regency Park Project of the same DLF Universal Ltd.When delivery of flats is delayed, all the three filed six complaints against DLF alleging deficiency in services. DLF in defence raised the question of jurisdiction of  Consumer Cmmission on the plea that complainant is not a consumer because he had invested the money for commercial purpose and and not as actual user .Reference was made to section 2 (o) d of the consumer protection act which clause was added to the act by amendment 2002 . Reference was also made to the earlier decided cases on the subject in the matter of chilkuri adarsh v/s ess ess vee constructions 111(2012)CPJ315(NC) wherein it was held that when a consumer has booked more than one unit of residential premises,it amounts to booking of premises for commercial purpose .Similar view wastaken in the case of jagmohan chabraand others v/s DLF Universal Ltd 1V 2007cpj 199 7 also in sunil guptav/s today homes 7infrastructure pvt ltd 11 2014 cpj 1 nc

Now the question before the commission was to check with the facts as to whether the present case falls under the calegory of commercial purpose or purely residential .during the proceedings one letter written by the complaianats was produced by DLF WHERIN in was clearly admitted that they had invested in poperties for the purpose of yielding profit. The contents of the letter are reproduced as hereunder-

We are one the regular investors of your esteemed organizer .at present we have the following properties with you –

Regency park   y 212,y-202,y-203

Rechmond park= f-061,f062,f052

Shopping mall =0125

Supermart   c-041 c

It is further said-you would recall that we had made the booking only for investment sake to earn more yield on our money . we had booked these flats at peak time assuringthat money will multiply with your esteemed organization.


This letter  revealed that complainats had booked the flats in various schemes  for the purpose of gain and yielding more benefit and interstingly the  letter was written on the letter head of  the firm and admitted that all investment was made for multiplying money .

On the basis of this admission National Commission held that if more than one flat is booked, it is treated as booking for investment purpose even the nature of property is residential.


Become a Member of the new revolution "Consumer Awakening" and instantly expand your knowledge with the Important Landmark Judgements, Laws Laid down by the Supreme Court for Consumer Rights, Get access to hundreds of Featured Articles in 2 different Languages; English and Hindi - a valuable professional resource to draw upon, and a powerful, collective voice to advocate for your protection of rights as a consumer nationwide.

Thank you for your interest in becoming a "Consumer Awakening" Member!
You will find information on Customer Rights, what we're doing and how to become a member. If you are looking forward to become a member of our portal and gain access to Hundreds of Featured Articles which will clearly give you an insight of yoru rights as a Consumer, then Read Further. more detail on our technologies and technology process,