Case Note & Summary
The dispute arose from a Joint Venture Agreement dated 2.7.2004 between the appellant and the first respondent for the development of a plot in Bhopal. The appellant, owner of the land, was to receive 45% of the sale proceeds from the construction of nine duplex flats, while the first respondent was responsible for construction and sale. Respondents 2 and 3, who purchased a duplex flat, filed a complaint against the first respondent for deficiency in service after the Municipal Corporation demolished the structure. The District Consumer Redressal Forum ordered the first respondent to refund the amount paid by respondents 2 and 3. The first respondent appealed, seeking to implead the appellant, which was allowed by the State Commission. The appellant contested this, arguing he was not liable as no claim was made against him. The State Commission upheld the District Forum's order but modified the interest rate and made both the appellant and first respondent liable. The National Commission dismissed the appellant's revision, affirming the State Commission's order. The Supreme Court, however, found that the appellant could not be made liable as he was not a party to the original complaint and had not been sought for relief by the complainants. The court ruled that the first respondent could not shift liability to the appellant in the appeal. The appeal was allowed, and the order making the appellant liable was set aside, while the modifications regarding interest and re-conveyance were upheld.
Headnote
A) Consumer Protection - Liability of Parties - Joint Responsibility - Consumer Protection Act, 1986, Section 12 - The court held that a service provider cannot pass on liability to a third party in an appeal if the complainant has not sought relief against that third party. The appellant was not a necessary party in the original complaint, and thus could not be made liable in the appeal. Held that the appeal was allowed and the order making the appellant liable was set aside (Paras 11-15).
Issue of Consideration
Whether a respondent against whom an order for payment has been made in a complaint under the Consumer Protection Act, 1986, can in an appeal filed by him, seek impleadment of a third party by contending that such third party is also liable either partly or wholly, even if the complainant has not sought any relief against such third party?
Final Decision
The Supreme Court allowed the appeal, set aside the order making the appellant liable, and upheld the modifications regarding interest and re-conveyance.
Law Points
- Consumer Protection
- Joint Venture Agreement
- Liability
- Deficiency in Service
- Impleadment
