T.K.A. Padmanabhan v. Abhiyan Cooperative Group Housing Society Ltd.
Background
The appellant, a member of the respondent cooperative housing society, was allotted a flat in 2004 but alleged delay in handing over possession and filed a consumer complaint in 2005 seeking compensation. The society sought to have the dispute referred to arbitration instead, and after litigation reaching the Delhi High Court and back, the District Consumer Forum eventually referred the parties to arbitration, a view upheld by the State Commission. The National Consumer Disputes Redressal Commission (NCDRC) dismissed the appellant's revision petition, but on the different ground that he was not a "consumer" because he had already taken possession without protest before filing the complaint.
Decision Breakdown
The Supreme Court held that an arbitration clause does not, by itself, oust the jurisdiction of consumer fora, so referring the dispute to arbitration was not the correct approach. It also found the National Commission's reasoning flawed because it never addressed the real jurisdictional question (whether reference to arbitration was proper) and instead disposed of the case on an unrelated ground: that the appellant ceased to be a "consumer" merely because he had since taken possession. The Court clarified that a claim for compensation for delayed possession survives even after possession is eventually delivered, since the grievance arises from the period before delivery. Since the complaint had never been examined on its merits at any stage, the Court set aside all three lower orders and restored the original consumer complaint for adjudication on merits, directing it be placed before the District Consumer Disputes Redressal Commission, Dwarka (given both parties now reside there), with a request to decide it within about a year.
Lesson Learnt
Having an arbitration clause in a housing or purchase agreement does not automatically bar a consumer from pursuing a complaint before consumer protection forums: consumer fora and arbitration are not mutually exclusive remedies. Also, taking possession of a flat, even without formal protest, does not by itself defeat an earlier-accrued right to claim compensation for delay in that possession being handed over.