COMMISSIONER, RAJASTHAN HOUSING BOARD AND OTHERSversusHIRALAL CHANDA

586                       [2021]
               SUPREME COURT     12 S.C.R. 586
                              REPORTS                    [2021] 12 S.C.R.


A           COMMISSIONER, RAJASTHAN HOUSING BOARD
                          AND OTHERS
                               v.
                             HIRALAL CHANDA
                     (Civil Appeal Nos 7651-7652 of 2021)
B
                        DECEMBER 11, 2021
              [DR. DHANANJAYA Y CHANDRACHUD AND
                        A. S. BOPANNA, JJ.]
             Consumer Protection Act, 1986: s.24-A – Appellant-Housing
C     Board launched a scheme for allotment of house on hire purchase
      mode of payment – Respondent submitted the application on
      23.2.1985 and deposited a registration amount of Rs.5000/- – On
      3.9.1993, appellant issued reservation-cum-demand letter
      demanding seed money to be deposited in three instalments for the
      allotment of house under the scheme – Respondent alleged that the
D
      said letter was addressed at an earlier location which he had left
      while appellant stated that the said place was the one notified to it
      by respondent – On 15.4.1999, appellant issued letter requiring
      the production of a challan for the deposit of seed money –
      Respondent sought time for same – On 29.07.1999, respondent was
E     again called upon to produce proof of deposit – Eventually on
      29.05.2000, registration of respondent was cancelled on account
      of failure to deposit seed money – Respondent was also asked to
      comply with formalities to effectuate refund of Rs.5000/- – On
      6.8.2009, Housing Board took policy decision to restore registration
      where same were cancelled due to administrative mistake of Board
F
      if application for restoration is filed within one year from the date
      of cancellation of registration – Eventually, respondent applied for
      restoration on 2.8.2010 which was followed by a notice of demand
      – Respondent filed consumer complaint complaining deficiency of
      service and challenging cancellation of allotment – District Forum
G     held in favour of respondent and directed the appellant to allot the
      respondent a house within six months at the rate which was applicable
      on the date when it was allotted to the next junior applicant – State
      Commission and National Commission confirmed the decision of
      District Forum – Hence instant appeal – Held: s.24A of the Act
      1986 provides the period of limitation for filing a complaint – A
H
                                      586
  COMMISSIONER, RAJASTHAN HOUSING BOARD v. HIRALAL                        587
                      CHANDA

period of two years has been provided for filing a complaint from         A
the date on which the cause of action arose – In the present case,
the cancellation took place on 29.5.2000 which was preceded by a
letter of the respondent dated 3.5.1999 by which he had expressly
stated that he would be making a deposit within one and a half
months – Even after the cancellation, there was no challenge to the
                                                                          B
cancellation of the allotment – The cause of action became barred
by time much prior to office order dated 6.8.2009 – The National
Commission erred in holding that the cause of action arose on the
issuance of office order dated 6.8.2009 because even on its plain
terms, the policy decision would not revive the registration of the
appellant which was cancelled due to his own default – District           C
Forum failed to notice that the respondent had received both the
letter dated 15.4.1999 as well as the letter of cancellation of
29.5.2000 – Moreover, letter dated 15.4.1999 contained a clear
reference to the earlier letter of the Housing Board of 1993 – It
would be far-fetched to assume that while the respondent had
                                                                          D
received several letters from the Housing Board, he had not received
the letter demanding the seed money in the first place – In conclusion,
besides the delay on the part of the respondent in espousing his
rights to challenge the cancellation of the allotment, the case did
not clearly fall within the ambit of the policy decision which was
taken on 6.8.2009.                                                        E
      Disposing of the appeals, the Court
     HELD: 1. No formal allotment was ever made to the
respondent and upon the deposit of the initial amount towards
registration, his name was registered under the Scheme.                   F
According to the appellant, a letter was addressed to the
respondent on 3 September 1993 requiring the deposit of seed
money or an advance in three installments under the Scheme.
The respondent disputes the receipt of the letter and the District
Forum primarily held in his favour on the ground that the appellant
ought to have produced proof of receipt, which was not done.              G
The important circumstance, which has a bearing on the case,
however, is that thereafter, the appellant communicated to the
respondent on 15 April 1999 requiring him to produce proof of
deposit of the seed money in terms of the earlier letter of 3
September 1993. There was a clear reference to the earlier letter         H
588            SUPREME COURT REPORTS                    [2021] 12 S.C.R.


A     dated 3 September 1993. The respondent is an advocate and this
      was a fact which would not miss the attention of a legally trained
      person. In his response, which was dated 3 May 1999, the
      respondent did not deny receipt of the earlier letter dated 3
      September 1993. By his reply, the respondent sought a time of
      one and a half months to deposit the amount. The respondent,
B
      however, admittedly did not make any deposit of the amount which
      was required until eventually the registration was cancelled on
      29 May 2000. The respondent was in receipt of the letter of
      cancellation which is admitted in terms of his letter dated 12
      December 2008 to the Estate Manager of the Housing Board
C     and, subsequently, on 2 August 2010 to the Commissioner, Urban
      Development. Even after the cancellation of the allotment, the
      respondent took no steps to pursue his remedies under the
      Consumer Protection Act 1986. The respondent was evidently
      persuaded to take recourse to his legal remedies in 2011 because
      a policy decision was taken by the Housing Board on 6 August
D
      2009 in terms of which, it was stipulated that where a registration/
      allotment had been cancelled due to an administrative mistake
      of the Housing Board, it would be restored if the application is
      filed within one year from the date of cancellation. On the other
      hand, cases where there was no administrative fault on the part
E     of the Housing Board, would not be restored. [Para 8][592-C-H;
      593-A-B]
            2. Section 24A of the Consumer Protection Act 1986
      provides the period of limitation for filing a complaint. A period
      of two years has been provided for filing a complaint from the
F     date on which the cause of action arose. In the present case, the
      cancellation took place on 29 May 2000 which was preceded by a
      letter of the respondent dated 3 May 1999 by which he had
      expressly stated that he would be making a deposit within one
      and a half months. Even after the cancellation, there was no
G     challenge to the cancellation of the allotment. The cause of action
      became barred by time much prior to the policy decision dated 6
      August 2009. The NCRC erred in holding that the cause of action
      arose on the issuance of the office order dated 6 August 2009
      because even on its plain terms, the policy decision would not
      revive the registration of the appellant which was cancelled due
H     to his own default. [Para 9][593-B, E; 594-D-F]
   COMMISSIONER, RAJASTHAN HOUSING BOARD v. HIRALAL                       589
                       CHANDA

      3. In this backdrop, the basis on which the District Forum          A
allowed the complaint was clearly erroneous. The District Forum
failed to notice that the respondent had received both the letter
dated 15 April 1999 as well as the letter of cancellation of 29 May
2000. Moreover, as we have noted earlier, the letter dated 15
April 1999 contained a clear reference to the earlier letter of the
                                                                          B
Housing Board of 1993. It would be far-fetched to assume that
while the respondent had received several letters from the
Housing Board, he had not received the letter demanding the
seed money in the first place. In conclusion, besides the delay
on the part of the respondent in espousing his rights to challenge
the cancellation of the allotment, the case did not clearly fall within   C
the ambit of the policy decision which was taken on 6 August
2009. [Paras 10, 11][594-F-H; 595-A]
      State Bank of India v. BS Agricultural Industries (2009)
      5 SCC 121 : [2009] 4 SCR 762; HUDA v. Tej
      Refrigeration Industries Ltd. (2013) 14 SCC 758 –                   D
      relied on.
      Chief Administrator PUDA and Ors. v. Shabnam Virk
      (2006) 4 SCC 74 : [2006] 3 SCR 221 – referred to.
                       Case Law Reference                                 E
[2006] 3 SCR 221                referred to              Para 8
[2009] 4 SCR 762                relied on                Para 9
(2013) 14 SCC 758               relied on                Para 9
                                                                          F
      CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 7651-
7652 of 2021.
      From the Judgment and Order dated 04.10.2018 of the National
Consumer Dispute Redressal Commission in Revision Petition No. 613-
614 of 2017.                                                              G

      N.K. Chauhan, Praveen Swarup, Advs. for the Appellants.
      Satyavikram, Ms. Lekha G.V., Advs. for the Respondent.

                                                                          H
590             SUPREME COURT REPORTS                        [2021] 12 S.C.R.


A            The Judgment of the Court was delivered by
             DR. DHANANJAYA Y CHANDRACHUD, J.
             1. Leave granted.
            2. These appeals arise from a judgment of the National Consumer
B     Disputes Redressal Commission1 dated 4 October 2018. The NCDRC
      dismissed the revision petitions seeking to challenge the judgment of the
      State Consumer Disputes Redressal Commission, Rajasthan 2 which in
      turn had affirmed the decision of the District Consumer Disputes
      Redressal Forum – Second, Jaipur3.

C             3. The appellant launched a General Registration Scheme4 in 1985
      in pursuance of which the respondent submitted an application on 23
      February 1985 for allotment of a Middle Income Group ‘B’ Category
      house in Jodhpur on a hire-purchase mode of payment, after depositing
      a registration amount of Rs 5,000. On 31 May 1985, the appellant issued
      a letter of confirmation acknowledging receipt of payment and confirming
D     the registration of the respondent under the Scheme. According to the
      appellant, a reservation-cum demand letter was issued to the respondent
      on 3 September 1993, demanding seed money, which was to be deposited
      in three installments for the allotment of a house under the Scheme. The
      respondent disputes receipt of the letter on the ground that it was
E     addressed to him at an earlier location which he had left. On the other
      hand, the case of the appellant is that the letter was addressed to the
      respondent at the place which was notified to the Housing Board. Be
      that as it may, on 15 April 1999, the appellant issued a communication to
      the respondent requiring the production of a challan for the deposit of
      the seed money in terms of the letter dated 3 September 1993. There is
F     no dispute about the receipt of this letter since the respondent submitted
      a reply on 3 May 1999 by which he sought time of a month and a half to
      deposit the seed money. The case of the appellant is that on 26 July
      1999, the respondent was once again called upon to produce proof of
      deposit.
G           4. Eventually, on 29 May 2000, the registration of the respondent
      was cancelled on the ground that he had failed to deposit the seed money
      or advance amount to obtain an allotment. By the letter dated 29 May
      1
        “NCDRC”
      2
        “SCDRC”
      3
        “District Forum”
      4
H       “Scheme”
  COMMISSIONER, RAJASTHAN HOUSING BOARD v. HIRALAL                           591
     CHANDA [DR. DHANANJAYA Y CHANDRACHUD, J.]

2000, the respondent was requested to comply with certain formalities        A
to effectuate the refund of Rs 5,000. There is no dispute about the fact
that the letter of cancellation was received by the respondent, this being
in terms admitted by the respondent in his subsequent letters dated 12
December 2008 (Annexure P-8) to the Estate Manager of the Housing
Board and again by his letter dated 2 August 2010 (Annexure P-10) to
                                                                             B
the Commissioner, Urban Development.
       5. The Housing Board took a policy decision on 6 August 2009 in
the following terms:
                          “OFFICE ORDER
      Subject: -    Restoration of the registration/allotment after          C
                    cancellation.
      As per the meeting no. 207 dated 16.07.2009 organized by the
      Director of Board, the decision was taken under point no. 207.15
      that all the earlier orders passed for cancellation of Registration/
      Allotment by the Board are quashed. The cases where the                D
      Registration/allotment are canceled due to administrative mistake
      of Board, in those cases if the application is filed within one year
      from the date of cancellation of registration/allotment the
      Registration/allotment will be restored only on approval from the
      board and the cases where there is no administrative fault on the      E
      part of Board, such Registration/allotment will not be restored .”
       6. Following the above decision, the respondent applied for
restoration of his registration on 2 August 2010, which was followed by
a notice of demand on 18 January 2011. Eventually, on 14 February
2011, the respondent instituted a consumer complaint before the District     F
Forum complaining of a deficiency of service and challenging the order
of cancellation of allotment. The District Forum by its order dated 11
December 2012, directed the appellant to restore the registration and to
allot the respondent a house within six months at the rate which was
applicable on the date when it was allotted to the next junior applicant.
The order of the District Forum was confirmed in appeal by the SCDRC         G
on 28 November 2016. The revision has been dismissed by the NCDRC
on 4 October 2018.
      7. We have heard Mr N K Chauhan, learned counsel for the
appellant and Mr Satyavikram, learned counsel for the respondent.
                                                                             H
592               SUPREME COURT REPORTS                       [2021] 12 S.C.R.


A             8. The primary issue which requires to be considered is whether
      there was, in fact, any default on the part of the appellant or conversely
      whether it was the respondent who was in breach of his obligations as a
      prospective allottee. In Chief Administrator PUDA and Ors. v.
      Shabnam Virk5, this Court discussed the binding effect of the terms
      and conditions of allotment on the consumer. This Court held that the
B
      consumer is bound to pay the increased price of the allotted house since
      the terms of the allotment specified that the price declared earlier is a
      tentative assessment and is subject to revision. Thus, the appellant is
      entitled to cancel the allotment if the respondent has failed to fulfil the
      conditions of the allotment. At this stage, it is material to note that no
C     formal allotment was ever made to the respondent and upon the deposit
      of the initial amount towards registration, his name was registered under
      the Scheme. According to the appellant, a letter was addressed to the
      respondent on 3 September 1993 requiring the deposit of seed money or
      an advance in three installments under the Scheme. The respondent
      disputes the receipt of the letter and the District Forum primarily held in
D
      his favour on the ground that the appellant ought to have produced proof
      of receipt, which was not done. The important circumstance, which has
      a bearing on the case, however, is that thereafter, the appellant
      communicated to the respondent on 15 April 1999 requiring him to
      produce proof of deposit of the seed money in terms of the earlier letter
E     of 3 September 1993. There was a clear reference to the earlier letter
      dated 3 September 1993. The respondent is an advocate and this was a
      fact which would not miss the attention of a legally trained person. In his
      response, which was dated 3 May 1999, the respondent did not deny
      receipt of the earlier letter dated 3 September 1993. By his reply, the
      respondent sought a time of one and a half months to deposit the amount.
F
      The respondent however admittedly did not make any deposit of the
      amount which was required until eventually the registration was cancelled
      on 29 May 2000. The respondent was in receipt of the letter of
      cancellation which is admitted in terms of his letter dated 12 December
      2008 to the Estate Manager of the Housing Board and, subsequently, on
G     2 August 2010 to the Commissioner, Urban Development. Even after
      the cancellation of the allotment, the respondent took no steps to pursue
      his remedies under the Consumer Protection Act 1986. The respondent
      was evidently persuaded to take recourse to his legal remedies in 2011
      because a policy decision was taken by the Housing Board on 6 August
      5
H         (2006) 4 SCC74
     COMMISSIONER, RAJASTHAN HOUSING BOARD v. HIRALAL                           593
        CHANDA [DR. DHANANJAYA Y CHANDRACHUD, J.]

2009 in terms of which, it was stipulated that where a registration/            A
allotment had been cancelled due to an administrative mistake of the
Housing Board, it would be restored if the application is filed within one
year from the date of cancellation. On the other hand, cases where
there was no administrative fault on the part of the Housing Board,
would not be restored.
                                                                                B
      9. Section 24A of the Consumer Protection Act 1986 provides the
period of limitation for filing a complaint. The provision reads thus:
         “24A.Limitation period
         (1) The District Forum, the State Commission or the National
         Commission shall not admit a complaint unless it is filed within       C
         two years from the date on which the cause of action has arisen.
         (2) Notwithstanding anything contained in sub-section (1), a
         complaint may be entertained after the period specified section-
         section (1), if the complainant satisfies the District Forum, the
         State Commission or the National Commission, as the case may           D
         be, that he had sufficient cause for not filing the complaint within
         such period.
         Provided that no such complaint shall be entertained unless the
         National Commission, the State Commission or the District Forum,
         as the case may be, records its reasons for condoning such delay.”     E
       A period of two years has been provided for filing a complaint
from the date on which the cause of action arose. In State Bank of
India v. BS Agricultural Industries6, this Court observed that the
limitation prescribed under Section 24A is a legislative mandate. If the
consumer forum adjudicates upon a complaint on merits, which is barred          F
by time, such an order would be liable to be set aside on grounds of
illegality. In HUDA v. Tej Refrigeration Industries Ltd.7, this Court
reiterated that the consumer forums should comply with the mandate of
Section 24A. This Court observed thus:
         “11. A reading of Sections 12 and 24-A makes it clear that a           G
         complaint filed after expiry of two years counted from the date of
         accrual of cause of action cannot be admitted by any consumer
         forum unless the complainant is able to show that he had sufficient
6
    (2009) 5 SCC 121
7
    (2013) 14 SCC 758                                                           H
594            SUPREME COURT REPORTS                          [2021] 12 S.C.R.


A           cause for not filing the complaint within the prescribed period and
            the forum concerned records reasons for condoning the delay.
            The embargo contained in Section 24-A against admission of a
            complaint is unambiguous and if that section is read in conjunction
            with Section 12, which prescribes the procedure for entertaining
            the complaint, it becomes clear that before admitting a complaint
B
            and issuing process, the consumer forum must feel convinced
            that the same has been filed within the period of limitation or that
            the complainant has succeeded in showing sufficient cause for
            delayed filing of the complaint. Unfortunately, most of the
            consumer forums in the country do not follow the provisions of
C           Section 12 read with Section 24-A and a large number of
            complaints are entertained without considering the issue of
            limitation. This results in overburdening of the dockets of consumer
            forums and consequential delay in the disposal of other deserving
            cases.”
D            In the present case, the cancellation took place on 29 May 2000
      which was preceded by a letter of the respondent dated 3 May 1999 by
      which he had expressly stated that he would be making a deposit within
      one and a half months. Even after the cancellation, there was no challenge
      to the cancellation of the allotment. The cause of action became barred
      by time much prior to the policy decision dated 6 August 2009. The
E     NCRC erred in holding that the cause of action arose on the issuance of
      the office order dated 6 August 2009 because even on its plain terms,
      the policy decision would not revive the registration of the appellant
      which was cancelled due to his own default.
             10. In this backdrop, the basis on which the District Forum allowed
F     the complaint was clearly erroneous. The District Forum failed to notice
      that the respondent had received both the letter dated 15 April 1999 as
      well as the letter of cancellation of 29 May 2000. Moreover, as we have
      noted earlier, the letter dated 15 April 1999 contained a clear reference
      to the earlier letter of the Housing Board of 1993. It would be far-fetched
G     to assume that while the respondent had received several letters from
      the Housing Board, he had not received the letter demanding the seed
      money in the first place.
             11. In conclusion, besides the delay on the part of the respondent
      in espousing his rights to challenge the cancellation of the allotment, the
H
   COMMISSIONER, RAJASTHAN HOUSING BOARD v. HIRALAL                              595
      CHANDA [DR. DHANANJAYA Y CHANDRACHUD, J.]

case did not clearly fall within the ambit of the policy decision which          A
was taken on 6 August 2009.
        12. At this stage, we may also note that the Housing Board which
is in appeal has stated before the Court that it would be ready and willing
to make an allotment to the respondent but not at the rate which was
prevalent when (as directed by the District Forum) a person immediately          B
junior to him in order of registration was made an allotment. The
respondent has himself been guilty of default and, therefore, such a
direction to allot at a rate prevalent in the past would not be correct.
Therefore, we record the statement of the Housing Board that should
the respondent be ready and willing at the present point of time, he
would be given an alternate allotment but in accordance with the rates           C
prevailing on the date of allotment. In the event that the respondent is
not willing to accept the alternate allotment at the present rate, it has
been stated on behalf of the appellant that the registration money which
has been deposited would be duly refunded to the respondent in
accordance with the policy of the Housing Board.                                 D
       13. Subject to the recording of the above statement, which has
been made on behalf of the Housing Board, we allow the appeals and
set aside the impugned judgment and order of the NCDRC dated 4
October 2018 in Revision Petition Nos 613-614 of 2017.
       14. The appeals shall stand disposed of in the above terms.               E

       15. Pending applications, if any, stand disposed of.

Devika Gujral                                             Appeals disposed of.

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