Landmark decision for home buyers: SC allows flat buyers to directly approach apex consumer commission

In a major relief for aggrieved home buyers, the Supreme Court has held that flat buyers can jointly approach the National Consumer Disputes Redressal Commission in case of a dispute with a builder, where the aggregate value exceeds Rs 1 crore

The Supreme Court has upheld the order of the National Consumer Disputes Redressal Commission (NCDRC) that flat buyers can jointly approach it, in case of a dispute with a builder.

A bench headed by justice Dipak Misra, rejected the appeal of Amrapali Sapphire Developers Pvt Ltd, challenging the NDCRC decision on the ground that a plea can be filed directly before the apex consumer commission if the total value of the disputed deal is over Rs 1 crore and the 43 buyers cannot file a joint plea before the NCDRC.

According to the Consumer Protection Act, if the cost involved is less than Rs 1 crore, the complainant has to first file the plea at the district consumer forum. The realtor submitted before the bench, also comprising justices AM Khanwilkar and MM Shantanagoudar that the cost of each flat was less than Rs 1 crore and so, the buyers were individually ineligible to directly approach the NCDRC.

See also: Recent legal judgements indicate better days for home buyers

In this case, the NDCRC had allowed multiple individuals, who bought flats from real estate developer Amrapali, to club their cases to cross the Rs 1 crore ceiling, which was challenged by the builder before the apex court.

The 43 buyers got together and formed Amrapali Sapphire Flat Buyers Welfare Association, to file the complaint against the builder in May 2016, for delay in handing over possession of their flats.

The apex court’s ruling comes as a breather for others stuck with delayed flats to approach the apex consumer commission in a similar manner.

In August 2016, the NCDRC had passed the decision in favour of the 43 flat owners in Amrapali’s Sapphire housing project, saying that they could form an association to achieve the pecuniary limit of Rs 1 crore, for approaching it directly.

“Once it is accepted that a consumer complaint on behalf of more than one consumer can be filed by a recognised consumer association, it can hardly be disputed that it is the aggregate value of the services which has to be taken for the purpose of determining pecuniary jurisdiction of the consumer forum before which the complaint is filed,” it had said.

The NCDRC had said if the aggregate value of services in respect of the flat buyers, on whose behalf this complaint was filed, was taken, then it exceeded Rs 1 crore and hence, it has the jurisdiction to entertain their plea.


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