Bharatkumar Pandya, Member

1. This is an appeal arising from the order of the West Bengal State Commission in Complaint case no. 116 of 2011. The respondents inspite of the service have not been attending to the proceedings. The dasti notice in terms of order dated 01.04.2024 has been served on the legal heirs of Smt. Shakti Roy Chowdhury and the affidavit to that effect has been filed on 06.08.2024 vide diary no. 27355. The amended memo of parties has been filed on 28.11.2024 through IA No. 17178 of 2024 in terms of the order dated 25.09.2024. The orders dated 21.09.2023, 01.04.2024, 25.09.2024 and 24.03.2026 are reproduced hereunder:

21.09.2023 Learned counsel for the appellants has invited the attention of the Bench to the order dated 09.05.2023 whereby directions have been issued to proceed ex- parte against respondents no. 1 to 4, 6 and 7. Respondent no. 5 was sought to be served by a fresh notice.

The office report dated 19.09.2023 indicates that due to some inadvertence notice could not be issued to respondent no. 5.

The aforesaid situation can now be redressed because according to the learned counsel for the appellants, respondent no. 5 has passed away and therefore an application has to be filed to bring on record the legal heirs of respondent no. 5. Consequently, no notice is required to be issued to respondent no. 5 at the moment.

Learned counsel for the appellants is granted six weeks' time to file an application . to bring on record the legal heirs of respondent no. 5.

In the event such an application is filed, the same shall be listed for directions on 18.12.2023.

01.04.2024 IA/1676/2024 This application has been moved praying for substituting the heirs of the fifth respondent, Mrs. Shakti Ray Choudhari, who is stated to have passed away on 12.03.2023. The prayer is to bring the legal heirs of the deceased respondent no. 5 on record.

The rest of the respondents have already been proceeded ex parte and as such this application deserves to be allowed, but before allowing the same let notice be issued to Mr. Sudipt Ray Chaudhari, resident of 1st Floor, 28A-Dr. Rajendra Road, VTC, L.R. Sarani, Kolkata 70002, calling upon him to answer this application moved on behalf of the appellants, as to why it should not be allowed and he be made answerable for the cause, being the legal heir and representative of the respondent no.

5. Notice be issued returnable within six weeks.

Learned counsel for the appellants may also take out dasti services for him.

List for directions on 13.08.2024.

25.09.2024 IA/1676/2024 Heard learned counsel for the appellant/ applicant, who has moved this application for substituting the heir of the fifth respondent.

Notices were issued to the legal heir on 01.04.2024, calling upon him to answer this application but the office report dated 07.08.2024 indicates that the postal notice has been refused to be received and on the other hand dasti services have been effected for which proof has been filed on record, stating therein that the notices have been served on and received by the legal heir on 25.07.2024. A receipt to that effect has also been appended.

In view of the aforesaid status of service, there is no opposition to this application. It is accordingly allowed and let Mr. Sudipt Ray Chaudhari be substituted in place of the fifth respondent, who has already been served. Amended memo of parties be filed within four weeks Appeal The matter shall now be listed forbearing on 21.03.2025.

24/03/2026 Heard learned Counsel for the Appellants, Mr. Bandhyopadhyay who has appeared online.

From the records we find that service had to be affected on the Respondents. Respondent No. 14, 6 and 7 after service had been proceeded ex-parte. Respondent No.-5 was reported to be unserved for which steps were taken under the Order dated 03.02.2026. The office report indicates that as per the track report the notices have been delivered on Respondent No.-5 as well. Learned Counsel for the Appellants states that dasti summons had been collected and have already been served on Respondent No.-5. The physical copy of the proof shall be filed within this week.

In the wake of the aforesaid information having been arrived service on the Respondents is complete and the matter is therefore to proceed finally.

On a perusal of the Impugned Order we find that the Complaint had been dismissed on the ground that the Appellant / Complainant did not fall within the definition of a consumer as it was a commercial entity. Learned Counsel for the Appellant states that the property had been purchased for its partners and therefore it was not for any commercial purpose. Be that as it may from a perusal of the pleadings of the Opposite Parties it also appears that they have taken a stand before the State Commission that the transaction had been terminated way back in the year 2011 through the letters dated 10.11.2011 and 01.12.2011 and further the property had been transacted with another 3rd party.

Learned Counsel for the Appellants submits that even if that is so the Appellants have not been refunded the amount and as such these issues require a consideration. List the matter for final hearing on 27.04.2026.

2. The brief facts of the case are the complainant filed a complaint alleging deficiency in service on the part of M/s Designs and others and seeking compensation as under:

(1) To direct the opposite parties to execute and register the deed of conveyance in favour of your petitioner in respect of the suit property described in schedule"B" hereunder written and in default have the sale deed be executed and registered through the Learned Court after completion of construction in all respect as well as after receiving the balance consideration amount. (2) To direct the opposite parties to complete the sum of Rs.50,000/- as . compensation for causing unnecessary harassment and mental stress. (3) To restrain the opposite parties from transferring alienating encumbering and handing over possession of the suit property to any third party till disposal of this case.

3. The State Commission in its order dated 22.05.2015 allowed the Miscellaneous Application no. 408 of 2014 filed by the respondents allegedly challenging the maintainability of the complaint on the ground that the complainant is a registered partnership and is engaged in commercial activity and therefore it is not a consumer under the provisions of the Consumer Protection Act, 1986. The State Commission allowed the M.A. and dismissed the complaint by referring to and relying on the decisions cited in unnumbered para 4 of the State Commission's order. It is observed that the complainant firm has entered into an arrangement of agreement for sale with the OP-respondent developer for a flat in a building being developed by the OP. Further, it is observed that the alleged agreement is merely a letter written by the OP M/s Designs acknowledging receipt of the sum of Rs.1 lakh from the complainant-appellant and further that there was no other formal agreement executed between the parties. It is therefore held that merely such correspondence between the parties cannot be treated as an enforceable agreement. It is also additionally held that the complainant firm is engaged in commercial activity and therefore the complainant cannot be said to be a consumer within the meaning of Section 2(1 )(d) of the Act. Allowing the MA, the complaint was accordingly dismissed. The State Commission's order dated 22.05.2015 is reproduced below:

"This order relates to hearing on MA 408 of 2014 filed by the OP challenging the maintainability of the complaint case on the ground that the Complainant is a registered partnership firm and is engaged in commercial activity. It is contended that the Complainant is not a consumer under the provisions of C. P. Act, 1986.

The Learned Counsel for the Misc. Applicant has submitted that the petition of complaint should be dismissed being not maintainable.

The Learned Counsel for the Complainant has submitted that the complaint is maintainable under the facts as stated in the petition of complaint.

We have heard the submission made by both sides. The Learned Counsel for the Misc. Applicant has referred to the decisions reported in 78 CWN 872 [Daddy S. Mazda & Ors vs. K. R. Irani]; (2009) 7 SCC 412 [State of Orissa vs. Prasanna Kumar Mohantyj; (1989) 3 SCC 56 [Gopal Saran vs. Satyanarayana]. The Complainant has filed written objection against the Miscellaneous Application contending that the transaction is not at all commercial in nature.

In paragraph 6 of the petition of complaint it has been stated that agreement for sale was executed on 24/03/08 between the OP No. 1 and the Complainant, tor the sale of the flat on the 2nd floor having 1725 sq. ft. super built up area together with proportionate undivided impartible share or interest of the land under the building. On perusal of the alleged agreement dated 24/03/08 we find that it is a letter written by the OP M/s Designs to the Complainant acknowledging the receipt of the sum of Rs. 1 lakh from the Complainant, it as been categorically stated in the W.V. that there was no formal agreement between the parties and the alleged agreement was a letter written by OP to the Complainant and that apart there was no formal agreement between the parties. Such being the position, we are of the view that the correspondence between the parties dated 24/03/08 was not an agreement for sale of the subject flat and it cannot be treated as an enforceable agreement.

Secondly, the Complainant is a partnership film under the name and style "M/s Sethi Constructions". The Complainant being a construction firm is engaged in commercial activity and, therefore, the Complainant cannot be said to be a consumer within the meaning of section 2(1)(d) of the C. P. Act, 1986.

The Miscellaneous Application bearing no.408 of 2014 is allowed. The petition of complaint is dismissed."

4. The aggrieved appellant-complainant approached this Commission by way of this appeal. The main grounds raised in the appeal are that the miscellaneous application referred to in the order of the State Commission was not for dismissing the complaint but was merely an application for cross-examination of the complainant. It is also urged in the grounds that the State Commission has erred in considering the maintainability of the complaint which was not only beyond the prayer in the miscellaneous application but was a mixed question of facts and law which could have been considered only at the time of final hearing. It is therefore prayed that the matter may be restored to the file of the State Commission.

5. However, during the course of hearing, the learned counsel Mr. Bandopadhyay has brought our attention to the copy of the reply to the complaint filed by OPs-1 to 7 at page 86 of the appeal file. It is submitted that it is an admitted position in paras 13 and 16 of the reply that the receipt of a total amount of Rs.12 lakhs has not been denied. It has further been informed by the learned counsel that the complainant now is of an advanced age and therefore would want to terminate the controversy by simply praying for the refund of the amount paid along with appropriate interest as deemed fit by this Commission. The para 13 and 16 of the reply are reproduced below:

13. The complainant, however, made a representation to the opposite party No. 1 that the complainant would only enter into an agreement finally upon the opposite party No. 1 providing a clear title and relevant title deeds in respect thereof to the complainant. The opposite party No. 1 at this agreed to handover all necessary documents to prove the clean and clear title of the said property. Upon receipt of the documents and after the complainant had the opportunity to investigate and look into all the aforesaid documents, the opposite party agreed to enter into an agreement with the opposite parties and in this connection made over an initial token amount of a sum of Rs. 1,00,000/- to the opposite party No. 1.

16. It was during this period that the complainant also made a part consideration of the entire consideration being a sum of Rs.12,00,000/-, details whereof has been relied upon by the complainant in the complaint. The opposite party No. 1 does not deny the receipt of the said amount from the complainant. From the document relied upon by the complainant it is evident that these amounts have been forwarded by the complainant to the opposite party sometime in October, 2008. In terms of the agreement reached between the parties, it was accepted that the complainant immediately enter into an agreement for sale to formal transaction.

6. We have considered the material on record including the fact that the OPs have been declared ex-parte in this appeal. We, apart from the reply to the complaint filed by the OP-respondents before the State Commission, have also perused the prayer (page 107) in the miscellaneous application filed by the OPs at page no. 101 of the appeal file. It is clear that the said petition was moved by the OPs only for cross-examining the complainant wherein an additional averment was also made that the complaint needs to be dismissed because the complainant, being engaged in commercial activity, is not consumer within the meaning of Section 2(1 )(d) of the Act. Thus, the ground raised appears valid. Apart from this, we also find that the State Commission has erred in holding that merely because the complainant is a partnership firm allegedly engaged in the business activity of building construction, it automatically for that reason alone, falls outside the purview of the Consumer Protection Act. By now, in view of the observations and guidelines by the Supreme Court in Daimler Chrysler India Private Limited versus Controls & Switchgear Company Limited and Anr. (2025) 1 SCC 534 and the decision in the case of Rohit Chaudhary and Anr. versus Vipul Limited (2024) 1 SCC 8, it is settled law that whether or not the complainant is a commercial entity in itself is a wholly irrelevant consideration for the purpose of operation of the bar in Section 2(1 )(d) with regard to the transaction having been entered into for a commercial purpose. It is also now settled that the issue whether the transaction entered into by the complainant is hit by the reason of the same being for commercial purpose is essentially a question of fact which fact needs to be established positively by the OP. It is also equally settled law (Lilavati Kirtilal Mehta Medical Trust Vs. Unique Shanti Developers & Ors. (2020) 2 SCC 265 Para 19 and 20) that not every but only that transaction with the OP which is established by the OP to be having a direct and close nexus with the profit generating activity of the complainant, can be considered to be 'for commercial purpose" for non-suiting the complainant u/s 2(1 )(d). Seen in this light, we find no material on record which even remotely justifies or support the finding of the State Commission that the complainant, being a commercial entity, cannot be said to be a consumer within the meaning of Section 2(1 )(d) of the Consumer Protection Act, 1986.

7. Apart from this, the State Commission has also held that it was categorically pleaded in the written version that there was no formal agreement between the parties and therefore the correspondence between the parties cannot be treated as an enforceable agreement so as to infer any alleged deficiency or to entertain the complaint. The perusal of the reply before the State Commission (pg. 86 of file) indicates that the opposite party was constructing a five storied building comprising 12 flats, one of which was agreed by the complainant to be acquired for a consideration of Rs.62.1 lakhs. As per the letter dated 24.03.2008, it was acknowledged and agreed between the parties that a formal agreement would be executed in due course.

However, such agreement was, as per the OP, never signed by the complainant and after a gap of nearly three years, and after the OP had vide letter dated 10.11.2011 terminated the transactions due to failure of the complainant in making further payments, the complainant has come up with the complaint, wherein the complainant has asked for relief of specific performance in the form of execution of the conveyance deed. However, admittedly, the OP had already communicated on 10.11.2011 and 01.12.2011 about the cancellation of the earlier transactions with request to produce the original receipts upon which the amount received shall be refunded after deducting 15%. After perusal of the reply we are of the considered opinion that the fact that some arrangement, agreement and quid pro quo with regard to the provisioning of building construction service by the OP for a consideration of Rs.62.1 lakhs, of which Rs. 12 lakhs was paid by the complainant, is an undisputed and admitted fact on record. Therefore, the non-suiting of the complainant merely on the ground of absence of written and formal agreement between the parties, even if it be so, in the peculiar facts of the present case, does not appear to be justified, particularly in light of the fact that the reply of the OP before the State Commission does not specify when the refund of the amount paid by the complainant, if any, was made. It is also an admitted position in view of the cancellation of the booking of the flat dated 01.12.2011, neither the possession has been handed over nor the amount has been refunded by the OR Thus, we hold that the second ground of dismissing the complaint has also no merits.

8. After considering the totality of the facts and circumstances and after noting the specific submission on behalf of the appellant-complainant that only the refund of the amounts paid along with the appropriate interest may be allowed to the appellant, we deem it appropriate, just and proper that the direction in this behalf is issued to the OPs. We note that while the complainant in the complaint has mentioned about the payment of Rs. 12 lakhs, there is no averment or evidence in the complaint as to why as against the admittedly agreed total consideration of Rs.62.1 lakhs, a payment only . of Rs.12 lakhs and no more was made and as to why after 18.10.2008 neither any payment is made nor any reason for such non-payment is forthcoming. We, therefore, have no option but to conclude that though the cancellation of the unit as made by the developer/respondent is not wholly unjustified, there is deficiency in service in not thereafter making the timely refund of even the 85% of the amount received from the appellant.

9. Therefore, after considering the totality of the facts, we also hold that the respondent M/s Designs and its proprietor, the developer of the building, who are evidence on record to have received the payments (page 31 to 35) and who have also communicated with the appellant-complainant including that for cancellation and who has 'held the money till date, is liable for such deficiency in service and for refunding and compensating the appellant. We also further hold that by way of compensation, the appellant shall be entitled for refund of Rs. 11,40,000/- (95% of Rs.12 lakhs) with 9% simple interest for the period starting from the respective deposits till the date of refund. The failure in making such payment on or before 11.09.2026 shall result into enhanced rate of 12% from 12.09.2026 on the amounts remaining unpaid after 11.09.2026. Appeal and the complaint are thus allowed in part.