Supreme Court affirms Consumer Complaints to be disposed of expeditiously

Guest article by:- Advocate Sahil Sethi

Builders can delay possession of apartments, not reply to consumer complaints. It has been observed that developers adopt various delay tactics in order to delay the filing of the reply.

The Hon’ble Supreme Court in a landmark judgment recently on 4th December 2015 has affirmed that replies to consumer complaints are mandatorily to be filed within a period of 45 days from receipt of the complaint.

What the Act says

In order to appreciate the recent judgement of the Supreme Court, readers would first have to understand the provisions of Section 13 (2) (a) of the Consumer Protection Act. Section 13(2) (a) of the Act provides that a consumer forum shall, if the complaint relates to any services (such as in the case of complaints filed by homebuyers), refer a copy of such complaint to the opposite party directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen days as may be granted by the District Forum, i.e. within a period of 45 days from the date of receipt of the complaint.

Past Judgements on the subject

While on a plain reading of the provision, it is evident that the maximum period allowed to an opposite party to file its reply to a consumer complaint is 45 days, the Hon’ble Supreme Court has time and again pondered over the question as to whether the period of 45 days mentioned in Section 13 (2) (a)  is directionary or mandatory in nature. In other words, whether a consumer forum can grant time to opposite party to file reply beyond the period of 45 days in view of Section 13 (2) (a), if it so deems fit or whether Section 13 (2) (a) curtails such discretion that a consumer forum may exercise in favor of an Opposite Party.

The first observation by the Hon’ble Supreme Court regards Section 13 (2) (a) came by a three-member bench in the case of Dr. J.J. Merchant and Ors. Vs. Shrinath Chaturvedi in the year 2002 (Copy of the Judgement available here). The Supreme Court in J.J. Merchant’s case observed that Section 13 (2) (a) is a legislative mandate of not giving more than 45 days in submitting the written statement or the version of the Opposite Party which needs to be adhered to by a consumer forum. However, despite this observation by a three-member bench of the Supreme Court, another bench of the Supreme Court in the case of Topline Shoes Ltd. Vs. Corporation Bank (of lesser strength of two judges) (judgement available here) in the same year held that Section 13(2) (a) is the directory in nature which the consumer forums are ordinarily supposed to apply. In other words, the forum or the commission has to consider all facts and circumstances of each case and then to exercise its discretion whether the delay in filing a reply beyond a period of 45 days can be condoned. Therefore, the right to condone the delay in filing reply by Opposite Party beyond a period of 45 days was given to consumer forums or commissions under the Act.

Which judgement to follow?

As many of you might be wondering, shouldn’t the decision delivered by a Bench of larger strength (J.J. Merchant) be binding on a subsequent Bench of lesser strength (Topline Shoes Case). By obvious corollary as well as settled law, the judgment of the Supreme Court in J.J. Merchant’s case should have held more weight than the subsequent decision in Topline Shoes which was by a bench of lesser strength (two judges). However, the problem arose when the judgment of the Supreme Court in Topline Shoes was approved by another three-member bench of the Supreme Court in Kailash Nanhku and Ors. in the year 2005 (judgement available here). The bench in Kailash v. Nankhu’s case  in addition to approving the Topline shoes judgement observed that the opinion regarding Section 13 (2) (a) in J.J. Merchant’s case was a mere obiter, i.e. something made or said in passing and hence not be taken to be a pronouncement on law. Resultantly, what was a legislative mandate was interpreted to be merely directionary by the Supreme Court and hence, a window was left open for Opposite Parties in consumer cases to file replies with delays beyond 45 days.

SC clears the air

After 10 years of this anomaly, the Supreme Court finally cleared the air in its recent judgment on 4th December 2015 inNew India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd (A copy of the judgement available here). The recent judgment of the Supreme Court opined that the three-Judge Bench of the Hon’ble Supreme Court in J.J. Merchant’s case should prevail. The Hon’ble Supreme Court in its recent judgement clarified that forums/commission under the Consumer Protection Act “can grant a further period of 15 days to the opposite party for filing his version or reply and not beyond that”. It is therefore now clear that the total time for filing of reply can not exceed beyond 45 days, as per Section 13(2)(a) of the Consumer Protection Act, 1986.

Conclusion

This judgement has come as a wake-up call to Opposite Parties in consumer matters, especially real estate builders/developers who regularly delay filing of replies in an attempt to delay relief to home buyers. It is advisable that all home buyers who have filed complaints against their builder/developer or are proposing to do so keep a track of when replies are filed in their matters and move appropriate applications for striking off the defence of the builder/promoter if the reply is filed beyond a period of 45 days from the date the builder/developers receives copy of the complaint.

We realise that this post maybe a lot of legal jargon for readers and hence invite readers to leave their queries in the comments section here. We will revert asap.

11 thoughts on “Supreme Court affirms Consumer Complaints to be disposed of expeditiously

  • December 12, 2015 at 9:31 am
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    In our cases which was heard in ncdrc last week by justice Ajit Bharioke, the builder has not filed reply even after 60 days but have asked that our petition is not maintainable as filed by the buyers association. Mr Bharioke has said that the opposite parties have not filed any replies on the merit of the application hence the argument in dismissal of application will take place on next date. In a sense the builder has lost right to reply. But builders lawyer has said he will go to supreme Court and will get an order to file the reply. What we should do now so that he can’t get favourable order from supreme Court?

  • December 12, 2015 at 9:47 am
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    Cite the recent SC judgement to Judge. He will surely appreciate it.

    Even if the builder appeals to the SC , it is most likely to be dismissed on the first day itself in light on this clear pronouncement by SC.

  • February 24, 2016 at 12:29 pm
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    I have a case efore the NCDRC where the builder has been asked to file their evidence of force majeure claims but they have been delaying the filing of this and each time the matter is being adjourned 9-12 months causing a lot of problems for us. Does this ruling apply to builder responses only for initial reply to the complaint or all subsequent stages? Any advice on what to do is greatly appreciated

    Thank you

  • February 24, 2016 at 6:11 pm
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    Madhu,

    Yes, this does apply to your case. Here is a case where Judge made reference to this case for a matter.

    At about 2.35 p.m., learned counsel for the opposite parties also appears. He points out that he had deposited Rs.50,000/- on 17.2.2016 but the order dated 30.11.2015 directs that the amount be deposited within two months. Moreover, in view of the Supreme Court authority in New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd., civil appeal Nos. 10941-10942 of 2013, decided on 4.12.2015, the delay in filing the written statement cannot be condoned. The opposite parties can take back the money. The demand draft is returned to learned counsel for the opposite parties.

    http://cms.nic.in/ncdrcusersWeb/GetJudgement.do?method=GetJudgement&caseidin=0%2F0%2FRA%2F359%2F2013&dtofhearing=2016-02-17

    Only thing that should be noted here is that it has been tried for not filing the written statement. No harm in exercising for your case too.

  • March 30, 2016 at 3:22 pm
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    Sir,

    I have a case (Appearing personally before court) before Khurda district consumer redressal forum (Bhubaneswar, Odisha) since May 2014 (Case No-156/2014).

    The opposite party filed his reply in August 2015 without adding any annexures/citations/references to counter my argument. Again I countered his reply immediately within stipulated time period. Since then he is taking time to reading my counter reply.

    The opp. party lawyer appeared before the forum maximum of six times (Out of 20 times) since my case was admitted. He is begging time on frivolous grounds (like his client met with an accident and bed ridden since one year and lives in Kolkata etc…) and the President is granting time to him even after my objection.

    The president himself is saying, ” Cases are pending since 2007, why do you expect 2014 case to be finished so soon?” The president is also laughing at me whenever I,m asking for compensation for each adjournment according to CPA amendment act 2005. Neither is he hearing my case nor dismissing it. He is not making “ex-party” to the opp.party, despite his hide and seek game. I’m really frustrated as I have to take leave from my Job to appear before the court.

    Last chance is always one chance. Unfortunately, he has given at least Five last chances to opposite party.

    Can I transfer this case to State consumer redressal commission, Odisha? If yes, what is the procedure to do it ? If No, please suggest me a way to get justice speedily

  • March 30, 2016 at 6:20 pm
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    Dear Prasanta,

    We suggest you write a letter addressing President, NCDRC and Ministry of Consumer Affairs with your grievances. Please do consult your lawyer before doing so.

    Unfortunately, you can’t approach higher court unless an order is passed by district forum.

    All the best!

  • May 11, 2016 at 5:28 pm
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    I want to engage you in my case, can i have your contact details?

  • May 18, 2016 at 11:42 am
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    We are also facing the similar problem with BPTP park Elite Premium, faridabad. Booked the flat in 2009, no possession till date. Almost 90% paid. Tried to reach many influential people, But all in vain, pls suggest smth

  • May 18, 2016 at 12:22 pm
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    Have you already approached the NCDRC? if not, you should do as a group immediately.

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