2025 (3) TMI 115 - SC - Indian Laws

Supreme Court overturns consumer forum's limitation period calculation under Consumer Protection Act 2019 for flat registration dispute

PUSHPA JAGANNATH SHETTY & ORS. Versus M/s. SAHAJ ANKUR REALTORS & ORS.

The SC held that the NCDRC erred in calculating the limitation period under the Consumer Protection Act, 2019. While the initial cause of action arose in ... Calculation of limitation in filing a complaint case under the Consumer Protection Act, 2019 - six months are required to be counted from the date of the indemnity cum undertaking, i.e. 10th January 2015 or not - HELD THAT:- The initial cause of action indeed arose in July 2015 after the six-month period expired, however, the Court cannot be amiss to the fact that the parties had been pursuing the matter with the respondent by way of letters, meetings, and even with the escrow agent, who, in turn, did his own back and forth with the owner, before finally releasing the flats in escrow in favour of the appellants. Further, as can be seen from the reliefs extracted supra, what has been claimed is the security of the title they received upon the respondent's default. The complaint case has not been filed seeking the flats in escrow for which the cause of action did arise on 10th July 2015, and hence the same limitation cannot be applied to a subsequent situation, which is that the appellants already have the flats with them. They only seek that the same be registered in their name and not alienated to any third party henceforth. The NCDRC have committed an error on the face of record. Finding the view taken by it to be ex-facie erroneous, the impugned order set aside with particulars mentioned in paragraph 1 of this order. The complaint filed by the appellant is within time. Appeal disposed off. The issues presented and considered in the Supreme Court judgment are as follows:1. Calculation of limitation in filing a complaint case under the Consumer Protection Act, 2019.2. Interpretation of the terms of an 'Indemnity-cum-Undertaking' agreement in a real estate context.3. Consideration of the continuing cause of action and efforts made by the parties in pursuing the implementation of a contract.4. Examination of the role of an escrow agent in facilitating the terms of an agreement.5. Application of the principle that limitation should not defeat substantive rights.The Court analyzed the relevant legal framework and precedents, including the Consumer Protection Act, 2019, and previous case law on contract enforcement and limitation periods. The Court interpreted the terms of the 'Indemnity-cum-Undertaking' agreement and considered the key evidence of the parties' actions and communications regarding the agreement. The Court applied the law to the facts by examining the timeline of events and the actions taken by the parties in relation to the agreement.In the detailed analysis, the Court found that the complaint filed by the appellant was within the limitation period despite the respondent's argument that it was time-barred. The Court emphasized that efforts made by the parties to secure possession of the flats should be considered in determining the applicable limitation. The Court held that the National Consumer Disputes Redressal Commission (NCDRC) had erred in dismissing the complaint on limitation grounds and set aside the impugned order. The Court directed the parties to appear before the NCDRC for further proceedings and requested an expeditious decision on the matter.The significant holdings of the judgment include the Court's determination that the complaint was filed within the limitation period, the error committed by the NCDRC in dismissing the complaint, and the directive for further proceedings before the NCDRC. The core principle established is that limitation should not be used to defeat substantive rights, and efforts made by parties in pursuing contractual obligations should be considered in assessing the timeliness of legal actions.In conclusion, the Supreme Court held that the complaint was not time-barred and should proceed for further consideration by the NCDRC. The Court emphasized the importance of considering the parties' efforts in fulfilling contractual obligations and ensuring that substantive rights are not defeated by technical limitations.