JUSTICE V.K. JAIN, PRESIDING MEMBER

                The complainant is a Public Limited Company, registered under the provisions of the Companies Act, 1956.  The complaints have been instituted through its Vice President who has been empowered to sign, verify and institute the complaint vide Board Resolution dated 29.2.2016.  The complainant booked residential flats with the opposite party in a project namely ‘Unitech Harmony” which the opposite party is developing at Nirvana Country, Gurgaon.  The flats according to the complainant were booked for the residential purpose of its officials.  The sale consideration for each flat was agreed at more than Rupees one crore and allotment letters with respect to the different units were issued accordingly.  The complainant claims to have paid the major part of the agreed sale consideration and the balance sale consideration, according to the complainant was payable at the time of final notice of possession.The possession was agreed to be delivered by 31.12.2009, subject of course to force-majeure circumstances. The grievance of the complainant is that despite several letters written by it to the opposite party, the possession of the aforesaid residential units has not been delivered to it.  The complainant is therefore before this Commission seeking possession of the aforesaid residential units, along with compound interest @ 24% per annum in additional to the contractual compensation of Rs.5/- per sq. ft. per month and a flat compensation for the harassment and injury.

2.        The complaints have been resisted by the opposite party which has taken a preliminary objection that the bookings were made for a commercial purpose, and therefore the complainant is not a consumer within the meaning of Consumer Protection Act.  On merits, the allotment made to the complainant as well as the payments received from it have been admitted.  It is alleged that the possession was delayed on account of reasons beyond the control of the opposite party.

3.        The opposite party has also filed applications, seeking dismissal of the complaint on the ground that the complainant is not a consumer within the meaning of Consumer Protection Act, it having booked the residential flats for a commercial purpose.

4.        The first question which arises for consideration in these complaints is as to whether the complainant is a consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act or not.  The aforesaid issue came up for consideration of a Three-Members Bench of this Commission in Consumer Complaint No. CC/51/2006 CG Power & Industrial Solutions Ltd. Vs. Mercedes-Benz India Pvt. Ltd., decided on 08.7.2016, and the following view was taken:

          “3.      Section 2(1)(d) of the Consumer Protection Act which defines the term ‘consumer’, to the extent it is relevant, reads as under:-

          "consumer" means any person who—

(i)       buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii)      hires or avails of any services for a consideration which has been paid or promised or partly paid and partly prom­ised, or under any system of deferred payment and includes any beneficiary of such services other than the person who 'hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purposes;

It would thus be seen that the emphasis is on the purpose for which the goods are obtained, though the use to which the goods are actually put would be helpful in deciding the purpose for which they were obtained.

4.      The term ‘commercial purpose’ has not been defined in the Consumer Protection Act and as held in Laxmi Engineering Works v. P.S.G. Industrial Institute [(1995) 3 SCC 583], in the absence of a statutory definition, we have to go by its ordinary meaning. ‘Commercial’ denotes ‘pertaining to commerce’ (Chamber’s Twentieth Century Dictionary); it means “connected with, or engaged in commerce; mercantile, having profit as the main aim” (Collin’s English Dictionary) and the word ‘commerce’ means “financial transactions, especially buying and selling of merchandise on a large scale” (Concise Oxford Dictionary)”.

 4.     Going by the dictionary meaning, a car or for that matter any goods obtained and the services hired or availed by a company can be said to have been obtained or  hired or availed for a commercial purpose, only if the said goods or services are intrinsically connected with, or related to the business or commerce in which the company is engaged. The acquisition of the goods or the hiring or availing of services, in order to bring the transaction within the purview of section 2 (1) (d) of the Consumer Protection Act, therefore, should be aimed at generating profits for the company or should otherwise be connected or interwoven with the business activities of the company. The purpose behind such acquisition should be to promote, advance or augment the business activities of the company, by the use of such goods or services. As observed by the Hon’ble Supreme Court in Laxmi Engineering Works (supra),  it is not the value of the goods but the purpose for which the goods are brought or put to use, which is relevant to decide whether the goods were obtained for a commercial purpose or not. The same would be the position, where services are hired or availed by a company. If the business activities of a company cannot be conveniently undertaken without the goods purchased or the services hired or availed by a company, such purchase or hiring/availing as the case may be, would be for a commercial purpose, because the objective behind such purchase of goods or hiring or availing of the services would be to enable the company to earn profits by undertaking and advancing its business activities.

5.      If a car or other goods are purchased or the services are hired or availed by a company for the personal use of its directors or employees, the purpose behind such acquisition is not to earn profits or to advance the business activities of the company. The purpose is to make certain facilities and amenities available to the directors and employees of the company as a part of the incentive offered to them by the company, as a reward or remuneration for the work which they are expected to perform for the company. It is not as if a company cannot run its business without providing such facilities and amenities to its directors and employees. It is not necessary for the business of the company, to provide such facilities and amenities to its directors and employees. Providing such facilities and amenities only motivates them to perform their work in an efficient and congenial environment, besides serving as an incentive aimed at eliciting better performance.  The company does not earn profit merely by making a car or certain other goods or services available to its directors and employees. Therefore, it would be difficult to say that such goods are purchased or the services are hired or availed by the company for a commercial purpose.

6.      The goods and services made available by a company to its directors or employees can be classified into the following three broad categories:-

(a) The goods and services which are obtained for and made available to the directors or employees of the company and are used by them only for their personal purposes, unconnected with the business of the company. For instance, the cars used by the directors and employees of the company for their shopping, outings, recreations, etc. or for commuting to and from the office of the company. Another example can be the air conditioners and furniture provided at the residence of the directors and employees of the company or the telephone or broadband got installed by the company at their residence.

(b) The goods and services made available to the directors or employees of the company and used by them primarily for their personal purposes but incidentally, also for the purposes of the company. For instance, a car used mainly for outings, recreations, personal commuting etc. of the directors and employees or their families, but also for visiting the factory and offices of the company or attending the business meetings.

(c) The goods and services made available by a company to its directors and employees primarily for the purposes of the company and used by them mainly for the purposes of the company but incidentally also for their personal purposes. For instance, a vehicle purchased for being used as a staff car or a delivery van, but sometimes also used for the personal purposes of the directors or employees, unrelated to the business of the company.

7.      As far as the goods and services falling in category (a) are concerned, there can be no dispute that since such goods were purchased or the services were hired or availed by the company and made available to its directors and employees for the purposes wholly unrelated to the business activities of the company, such an acquisition cannot be said to be for a commercial purpose. No commercial purpose of the company is achieved by purchasing such goods or hiring or availing such services and then making them available to its directors and employees.

11.    For the reasons stated hereinabove, the issue referred to the larger Bench is answered as follows:-

(a) If a car or any other goods are obtained or any services are hired or availed by a company for the use/personal use of its directors or employees, such a transaction does not amount to purchase of goods or hiring or availing of services for a commercial purpose, irrespective of whether the goods or services are used solely for the personal purposes of the directors or employees of the company or they are used primarily for the use of the directors or employees of the company and incidentally for the purposes of the company.”

(b) The purchase of a car or any other goods or hiring or availing of services by a company for the purposes of the company amount to purchase for a commercial purpose, even if such a car or other goods or such services are incidentally used by the directors or employees of the company for their personal purposes.”

5.        It would thus be seen that if a residential flat is booked by a company for the residence of its employees, it cannot be said that the services were hired or availed for a commercial purpose.  It is expressly alleged in the complaint that the flats were booked by the complainant for the residence of its officials.  There is no evidence to controvert the aforesaid stand taken by the complainant.  There is no evidence of the complainant having booked these flats for speculative purposes such as making profit by selling the same at a higher price or even for the purpose of earning rental income by letting out the same to outsiders.  Though, the names of the officials of the company have not been disclosed in the complaints, the said disclosure was not at all necessary considering that the staff quarters are given to the employees on license basis and can be retained by them only during the course of their employment with the provider.  The employees keep on changing and consequently the allottees of such staff quarters will also keep on changing from time to time.  The residences meant to be used as staff quarters are not meant for any particular employee and can be allotted by the employer to any employee. 

6.        The learned counsel for the opposite party drew my attention to para 13 of the complaint wherein it is alleged that the opposite party had deprived the complainant from the use and benefit of the apartment thereby causing financial loss on account of payment and rent and other benefits as per the terms of the agreement.  The aforesaid averment, in my opinion, does not show that the residential flats were booked for a commercial purpose.  It is stated in the reply filed by the complainant to the interim application of the opposite party that the flats were booked by the complainant for residential use of its officials and there was no intention to use the same for commercial purposes.  It is further stated in the reply filed by the complainant that the loss on account of rent, as mentioned in the complaint, happened due to non-availability of the booked flats since the complainant had to provide residential accommodation to its officials on market rent and / or to pay rent to them.  I therefore, hold that since the residential flats in question were booked by the complainant for the residences of its employees, the complainant is a consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act. 

7.        On merits, the complaint has been resisted by the opposite party on the grounds which this Commission has already rejected in several Consumer Complaints relating to this very project, including Consumer Complaint No. 2 of 2014 Mohit Chopra Vs. M/s. Unitech Ltd., decided on  30.5.2017, CC No. 1088 of 2015, Raja Balasubramanian Vs. M/s. Unitech Ltd. & Anr. decided on 18.4.2017 and CC No. 368 of 2014 Shweta Kapoor & Anr. Vs. M/s. Unitech Ltd. & Anr. decided on 14.1.2016.

The delay in offering possession was sought to be justified on the following grounds in Shweta Kapoor (supra):

1. “Common Wealth Games during April, 2010 to March, 2011 – the Common Wealth Games were organized in the NCR region which resulted into an extreme shortage of labours in the region as most of the labour force was employed and / or was engaged by the Government to expedite the completion of the pending projects required for the Common Wealth Games.
2. Active implementation of social schemes like NREGA and JNNURM – In addition to the above due to active implementation of alluring and promising schemes floated by the Central and State Government, there was a sudden shortage of labour / workforce especially in the real estate market.  The workforce / labour forces were tempted to return to their respective states due to the guaranteed employment. 
3. Order dated 16.7.2012 passed by the Hon’ble High Court of Punjab & Haryana (hereinafter referred to as the “Order” – The above mentioned Order strictly restrained the usage of ground water and directed to use only treated water from available Sewerage Treatment Plants (hereinafter referred to as “STP”).  As the availability of STP, basic infrastructure and availability of water from STP, was very limited in comparison to the requirement of water in the ongoing constructions activities in NCR region.

This scarcity of an essential commodity for construction purposes made it difficult for the Opposite Parties to cope up with the pre-decided schedules as the availability of treated water became very limited and against the total requirement of water.  It is to be highlighted here that only approx. 10-15% of required quantity was available at construction sites to continue with the planned construction activities.  

In addition to the above, the Opposite Parties were later completely banned to use underground water for construction purposes and were vehemently directed to use recycled water only. 

iv.    Notification dated 14.9.1999 published by Ministry of Environment and Forest –The Notification dated 14.09.1999 barred the excavation of top soil for the manufacture of bricks and further directed that no manufacturing of clay bricks or tiles or blocks be done within a radius of 50 (fifty) kilometres from coal and lignite based thermal power plants without mixing atleast 25% of ash with soil.  As a consequence of this Notification dated 14.09.1999 various brick kiln were shut creating shortage of essential commodity bricks for construction purposes.

4. Further, another raw material i.e. the sand which is used as mixture along with cement was also not available in the vicinity of the Complex due to restrictions from Mining Department imposed in the entire Aravali region and the same had to be procured from neighbouring State of Rajasthan.  
5. Later in a completely unforeseeable ruling by the Hon’ble Supreme Court of India dated 08.05.2009 the Hon’ble Court suspended all the mining operations in the Aravalli Hill range falling in State of Haryana within the area of approx.. 448 sq. kms. In the district of Faridabad and Gurgaon including Mewat which directly affected the construction schedules and activities of the Respondents herein. 
6. Notification dated 14.09.2006 published by the office of Director, Town and Country Planning, Haryana – This Notification dated 14.09.2006 imposed certain restrictions and prohibitions on new projects or activities, or on the expansion or modernization of existing projects or activities based on their potential environmental impact being undertaken in any part of India unless prior environmental clearances are obtained.  Therefore, due to the said Notification dated 14.09.2006, the procedure of obtaining approvals and sanctions by the opposite parties led to the delay in the present construction schedule. 

8. Recession in the economy – That since the real estate industry is a cyclical industry that is affected by both local and national economic conditions.  While macroeconomic conditions affect the overall state of the real estate industry, local supply and demand conditions are by far more important factors affecting the real estate markets as a result of which the availability of essential resources namely the labour and various raw materials became scarce.”

3.      Rejecting all these aforesaid plea taken by the OPs, this Commission, directed possession of the flat to the complainants alongwith compensation in the form of simple interest @ 12% per annum. 

8.        The learned counsel for the complainant states on instructions that in order to avoid any further litigation in the matter, the complainant is restricting its claim to refund of the principal amount paid by it along with compensation in the form of simple interest @ 10% per annum, in terms of Clause 4(e) of the Buyers Agreement which provides that if for any reason the Developers are not at all in a position to offer the Apartment, as agreed herein, the Developers may offer the purchaser(s) an alternative property or refund the amount in full with interest @ 10% per annum without any further liability to pay damages or any other compensation. 

9.        The complaints are therefore disposed of with the following directions:

(i)        The opposite party shall refund the entire principal amount received from the complainant in these matters, along with compensation in the form of simple interest @ 10% per annum from the date of each payment till the date on which the aforesaid amount, along with compensation in terms of this order is actually refunded;

(ii)       The opposite party shall pay Rs.25,000/- as the cost of litigation in each complaint.

(iii)      The payment in terms of this order shall be made within three months from the date of this order.