Complain within the time limit

As the builder had given possession and refunded the excess stamp duty in 2015, the limitation period would start then

Punjab State Federation of Co-operative House Building Societies  was to construct super-deluxe flats at Mohali. Many people applied for these flats which were allocated in 2004. The date of possession was not mentioned.
 

After considerable delay, possession was given to the purchasers between July 2014 and January 2015. The excess stamp duty, which had been collected in advance, was also refunded to the flat purchasers by October 2015.
 

In 2019, several flat purchasers filed individual complaints before the Punjab State Commission. Since excess money towards stamp duty had been collected by the builder and retained for a long time till it was finally refunded, the flat purchasers sought interest on refund. They also claimed compensation for undue delay in possession.

The builder contested the case, pointing out that a complaint under the Consumer Protection Act ought to be filed within two years from the date when the cause of action arose. As the complaint was filed nearly four years from the date of possession and refund, the builder argued that the complaints were time-barred, and ought to be dismissed.

The State Commission upheld the builder's objection and dismissed the complaint as being barred by limitation. The purchasers appealed against this order to the National Commission, contending that the cause of action should be considered to be continuing in respect of housing construction disputes.

The National Commission, relying on the Supreme Court decision in the State Bank of India v/s B.S. Agricultural Industries case, pointed out that an obligation is cast on the consumer forum to scrutinise a complaint at the stage of admission to ascertain whether it is within limitation. If not, the consumer would have to make an application giving the reason for the delay and the consumer forum would have to give a reasoned order for either accepting the explanation or rejecting it.

The National Commission observed that the cause of action would be considered to be continuing in the matter of disputes regarding a delay in construction and failure to execute conveyance granting the right, title and interest in the property, as the purchase process remains incomplete and pending till the property is conveyed by the builder. Similarly, the cause of action would continue for defective construction and other statutory breaches. In contrast, limitation would begin to run as soon as the entire transaction is completed. So, in this case, as the builder had handed over possession and refunded the excess stamp duty in 2015, the period of limitation would commence from that date, requiring the complaint to be filed by the year 2017. The Commission concluded that the complaint filed in 2019 was rightly dismissed as being time-barred.

Accordingly, by an order dated February 24, 2020 delivered by Justice V.K. Jain, the National Commission dismissed the appeal filed by the flat purchasers. 
 

The writer is a consumer activist