Legal provisions involved: Section 2(1)(d) of the Consumer Protection Act, 1986.

Judgement by: Supreme Court of India.

Judge/Bench: Justice Prashant Kumar Mishra and Justice N.V. Anjaria.

Facts

The case concerned a housing project called “The Villas” in Sector 25, Gurgaon, launched in 2005. The buyers booked a residential flat in 2006 under a Flat Buyer’s Agreement that promised possession within 36 months. They later complained of delay in possession, changes in layout, extra charges, and missing promised fittings. 

They filed a case before the NCDRC in 2017. The Commission dismissed the complaint, saying the buyers had leased the flat and were therefore using it for commercial purposes, so they were not “consumers”.

Key legal provisions

Section 2(1)(d) of the Consumer Protection Act, 1986

Issues raised

Does renting out a residential flat automatically make the buyer a commercial consumer?

Arguments of the case

The builder argued leasing showed a profit motive. The buyers argued that the flat was purchased mainly for residential use and leasing alone does not change their status.

Judgement

The Supreme Court held that leasing a flat alone does not make the purchase commercial. The main purpose of buying must be examined. The complaint was restored.

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