Page 24 - Banking Finance April 2020

LEGAL UPDATE

ONGC imported certain equipment In 2019, several flat purchasers filed the consumer would have to make an
from Russia for exploration of hydrocar- individual complaints before the Punjab application giving the reason for the
bon and Customs duty was paid in State Commission. Since excess money delay and the consumer forum would
1986. towards stamp duty had been col- have to give a reasoned order for ei-
lected by the builder and retained for ther accepting the explanation or re-
There was an excess payment of a long time till it was finally refunded, jecting it.
around Rs. 22 crore, which was admit- the flat purchasers sought interest on
tedly due. But the Kandla port authori- refund. They also claimed compensa- The National commission observed
ties prevaricated on the refund, one tion for undue delay in possession. that the cause of action would be con-
main argument being that ONGC had sidered to be continuing in the matter
not passed on the benefit to “consum- The builder contested the case, point- of disputes regarding a delay in con-
ers”. The court rejected this defence ing out that a complaint under the struction and failure to execute con-
stating that there were no consumers Consumer Protection Act ought to be veyance granting the right, title and
in this case and the demand should be filed within two years from the date interest in the property, as the pur-
“deprecated, quashed and set aside”. when the cause of action arose. As the chase process remains incomplete and
complaint was filed nearly four years pending till the property is conveyed by
It gave the authorities 30 days to cal- from the date of possession and re-
culate the dues with interest, after fund, the builder argued that the com- the builder.
hearing ONGC. The court rejected the plaints were time-barred, and ought to
prayer of the authorities to grant more be dismissed. Similarly, the cause of action would
time to pay as there was already “in- continue for defective construction and
other statutory breaches. In contrast,
ordinate delay” in the matter. The State Commission upheld the
limitation would begin to run as soon
builder’s objection and dismissed the
Complain must be within complaint as being barred by limita- as the entire transaction is completed.
So, in this case, as the builder had
time limit: National tion. The purchasers appealed against
this order to the Nation commission, handed over possession and refunded
Comission contending that the cause of action the excess stamp duty in 2015, the
Punjab State Federation of Co-opera- should be considered to be continuing period of limitation would commence
tive House Building Societies was to in respect of housing construction dis- from that date, requiring the com-
construct super-deluxe flats at Mohali. putes. plaint to be filed by the year 2017. The
Many people applied for these flats Commission concluded that the com-
which were allocated in 2004. The The National Commission, relying on plaint filed in 2019 was rightly dis-
date of possession was not mentioned. the Supreme Court decision in the missed as being time-barred.
After considerable delay, possession State Bank of India v/s B.S. Agricultural
was given to the purchasers between Industries case, pointed out that an Accordingly, by an order dated Febru-
July 2014 and January 2015. The excess obligation is cast on the consumer fo- ary 24, 2020 delivered by Justice V. K.
stamp duty, which had been collected rum to scrutinize a complaint at the Jain, the National Commission dis-
in advance, was also refunded to the stage of admission to ascertain missed the appeal filed by the flat pur-
flat purchasers by October 2015. whether it is within limitation. If not, chasers.

22 | 2020 | APRIL | BANKING FINANCE