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Sunday, March 31, 2019

whether a direction for the deletion of the second respondent was warranted. We may note the submission which has been urged on behalf of the appellants to the effect that under Section 2(zk) of the Real Estate (Regulation and Development) Act, 2016, the definition of the expression “promoter” would include the entity which is constructing the building as well as the entity which is selling the apartments or plots. Section 2(zk) reads as follows:- “(zk) "promoter" means,— (i) a person who constructs or causes to be constructed an independent building or a building consisting of apartments, or converts an existing building or a part thereof into apartments, for the purpose of selling all or some of the apartments to other persons and includes his assignees; or (ii) a person who develops land into a project, whether or not the person also constructs structures on any of the plots, for the purpose of selling to other persons all or some of the plots in the said project, whether with or without structures thereon; or (iii) any development authority or any other public body in respect of allottees of— (a) buildings or apartments, as the case may be, constructed by such authority or body on lands owned by them or placed at their disposal by the Government; or (b) plots owned by such authority or body or placed at their disposal by the Government, for the purpose of selling all or some of the apartments or plots; or 5 (iv) an apex State level co-operative housing finance society and a primary co-operative housing society which constructs apartments or buildings for its Members or in respect of the allottees of such apartments or buildings; or (v) any other person who acts himself as a builder, coloniser, contractor, developer, estate developer or by any other name or claims to be acting as the holder of a power of attorney from the owner of the land on which the building or apartment is constructed or plot is developed for sale; or (vi) such other person who constructs any building or apartment for sale to the general public. Explanation.— For the purposes of this clause, where the person who constructs or converts a building into apartments or develops a plot for sale and the persons who sells apartments or plots are different persons, both of them shall be deemed to be the promoters and shall be jointly liable as such for the functions and responsibilities specified, under this Act or the rules and regulations made thereunder;” On the basis of the material which is on record, it is not possible for the Court to conclude at the present stage that the second respondent is unconnected with the project or has been impleaded as a party to the proceeding without any reason or basis. The issue as to whether, and if so, what relief can be ultimately granted in the consumer complaint is a matter which will be determined during the course of the hearing of the complaint. Consequently, we are of the view that on the basis of the averments contained in the complaint as well as on the material which has been placed on the record by the second respondent, an order for deletion was not warranted at this stage.

1
REPORTABLE
 IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
 CIVIL APPEAL NO(S). 259 OF 2019
ASSOCIATION FOR CONSUMER WELFARE AND AID Appellant(s)
 VERSUS
GRANITE GATE PROPERTIES PRIVATE LIMITED & ANR. Respondent(s)
WITH
CIVIL APPEAL NO(S). 1501 OF 2019
JUDGMENT
Dr. Dhananjaya Y. Chandrachud, J.
Civil Appeal No. 259 of 2019
Admitted.
By the impugned order dated 31 July 2018, the National
Consumer Disputes Redressal Commission1 directed that the second
respondent (Three C Universal Developers Private Limited) be
deleted from the array of parties. The complaint has been
admitted only against Granite Gate Properties Private Limited,
the first respondent to the present appeal.
The only ground on which the above directions have been
issued are spelt out thus:
“The consumers on whose behalf this complaint is
instituted did not hire or avail the services of
opposite party No. 1 and therefore, they cannot
be said to its consumers.”
Notice was issued in these proceedings on 7 January 2019.
1 “NCDRC”
2
A counter affidavit has been filed by the second respondent
which was ordered to be deleted by the NCDRC from the array of
parties.
The consumer complaint filed by the appellant, which is
an association representing the buyers, seeks diverse reliefs
including the grant of possession of flats to the allottees of
the real estate project together with common amenities and
restraining the respondents from charging additional amounts
for alleged increases in the area of the flats otherwise than
in accordance with the allotment letters. The averments in
paragraphs 5 and 13 of the complaint before the NCDRC read as
follows:
“5. That the Allotment Letters clearly provide
that the projects are being undertaken by
Opposite Part 2 (which is formed by Opposite
Party 1 specifically for the purpose of
construction of Lotus Panache). The entire
consideration amount for the project was required
to be paid to Opposite Party 2 by the allottees,
although the project was marketed by Opposite
Party 1 and the parties marketed themselves as
“The 3C Company” which is also evident from the
letterhead of the Company on which the Allotment
Letters were printed.”
13. The Companies registered project Lotus
Panache under Uttar Pradesh Real Estate
Regulatory Authority and M/s Granite Gate
Properties Pvt. Ltd. was declared by the
Companies as the Promoter of the project.
However clearly as per the agreement, Three C
Universal Developers Private Limited was the main
company as it has formed the SPC (which was
formed specifically for development of the
project Lotus Panache and was the one which was
marketing and executing the agreements),
therefore having been vested the primary
responsibility of the entire project together
with all the other opposite parties who also are
jointly and severally responsible for all the
obligations contained herein.
3
Further, the details of Project Lotus Panache as
obtained from the website of Uttar Pradesh Real
Estate Regulation Authority clearly shows the
proposed date of completion of the project as
31.12.2022. Surprisingly, the original start
date has been specified as 11.5.2010 and the
modified start date for the project has been
specified as 10.8.2017.”
In sum and substance therefore, the case of the
appellants before the NCDRC is that the second respondent,
Three C Universal Developers Private Limited, is in fact the
main promoter of the project and that it is vested with the
primary responsibility of completing the project. Para 17.1
of the complaint reads as follows:
“17.1 The Opposite Parties state that the
Allottees had entered into Agreements with only
Opposite Party 2 and no one else. However,
clearly Opposite Party 1 and Opposite Party 2
have been acting as one and the same Company.
Opposite Party 1 has admittedly marketed the
Project and the Companies have represented
themselves together as “The 3C Company”. The
allotment letter names Opposite Party 1 as one of
the Parties and the Builder Buyer Agreement
specifically recognises that Opposite Party 2 is
only a Special Purpose Company formed by the
Opposite Party 1 for a particular purpose.“
 In the complaint before the NCDRC, Three C Universal
Developers Pvt. Ltd. (the second respondent to the present
appeal) is arrayed as opposite party No. 1, while Granite Gate
Properties Pvt. Ltd. (the first respondent to the present
appeal) is opposite party No. 2.
In the counter affidavit which has been filed in these
proceedings, the second respondent has stated that the first
respondent was set up as a special purpose vehicle by a
consortium of which the second respondent is a part. Moreover,
4
it has been stated that a construction agreement was entered
into between the first and second respondents on 15 December
2009.
At the present stage, the limited issue with which this
Court is concerned is whether a direction for the deletion of
the second respondent was warranted.
We may note the submission which has been urged on behalf
of the appellants to the effect that under Section 2(zk) of the
Real Estate (Regulation and Development) Act, 2016, the
definition of the expression “promoter” would include the
entity which is constructing the building as well as the entity
which is selling the apartments or plots.
Section 2(zk) reads as follows:-
“(zk) "promoter" means,— (i) a person who
constructs or causes to be constructed an
independent building or a building consisting of
apartments, or converts an existing building or a
part thereof into apartments, for the purpose of
selling all or some of the apartments to other
persons and includes his assignees; or
(ii) a person who develops land into a project,
whether or not the person also constructs
structures on any of the plots, for the purpose of
selling to other persons all or some of the plots
in the said project, whether with or without
structures thereon; or
(iii) any development authority or any other
public body in respect of allottees of—
(a) buildings or apartments, as the case may be,
constructed by such authority or body on lands
owned by them or placed at their disposal by the
Government; or
(b) plots owned by such authority or body or
placed at their disposal by the Government, for
the purpose of selling all or some of the
apartments or plots; or
5
(iv) an apex State level co-operative housing
finance society and a primary co-operative housing
society which constructs apartments or buildings
for its Members or in respect of the allottees of
such apartments or buildings; or
(v) any other person who acts himself as a
builder, coloniser, contractor, developer, estate
developer or by any other name or claims to be
acting as the holder of a power of attorney from
the owner of the land on which the building or
apartment is constructed or plot is developed for
sale; or
(vi) such other person who constructs any building
or apartment for sale to the general public.
Explanation.— For the purposes of this clause,
where the person who constructs or converts a
building into apartments or develops a plot for
sale and the persons who sells apartments or plots
are different persons, both of them shall be
deemed to be the promoters and shall be jointly
liable as such for the functions and
responsibilities specified, under this Act or the
rules and regulations made thereunder;”
On the basis of the material which is on record, it is
not possible for the Court to conclude at the present stage
that the second respondent is unconnected with the project or
has been impleaded as a party to the proceeding without any
reason or basis. The issue as to whether, and if so, what
relief can be ultimately granted in the consumer complaint is a
matter which will be determined during the course of the
hearing of the complaint.
Consequently, we are of the view that on the basis of the
averments contained in the complaint as well as on the material
which has been placed on the record by the second respondent,
an order for deletion was not warranted at this stage.
6
We accordingly, allow the appeal and set aside the
impugned order of the NCDRC dated 31 July 2018. The second
respondent is accordingly restored as a party to the
proceedings before the NCDRC. The complaint shall stand
admitted against both the first and second respondents for
final disposal.
We however, clarify that all the rights and contentions
of the parties are kept open to be urged before the NCDRC.
The appeal is, accordingly, disposed of. There shall be
no order as to costs.
Pending application(s), if any, shall also stand disposed
of.
Civil Appeal No. 1501 of 2019
Admitted.
For the reasons indicated by this Court while disposing
of the companion civil appeal (Civil Appeal No. 259 of 2019),
the order of the NCDRC dated 20 July 2018 directing the
deletion of Three C Universal Developer Pvt. Ltd. is set aside.
The appeal shall stand disposed of in similar terms as
the order passed in the companion appeal. There shall be no
order as to costs.
Pending application(s), if any, shall stand disposed of.
.............................J.
 (DR. DHANANJAYA Y. CHANDRACHUD)
..............................J.
 (HEMANT GUPTA)
 NEW DELHI
 MARCH 25, 2019
7
ITEM NO.44 COURT NO.8 SECTION XVII
 S U P R E M E C O U R T O F I N D I A
 RECORD OF PROCEEDINGS
Civil Appeal No(s). 259/2019
ASSOCIATION FOR CONSUMER WELFARE AND AID Appellant(s)
 VERSUS
GRANITE GATE PROPERTIES PRIVATE LIMITED & ANR. Respondent(s)
(IA 183287/2018, IA 183289/2018)
WITH
C.A. No. 1501/2019 (XVII)
(IA 620/2019)
Date : 25-03-2019 These matters were called on for hearing today.
CORAM : HON'BLE DR. JUSTICE D.Y. CHANDRACHUD
 HON'BLE MR. JUSTICE HEMANT GUPTA
For Appellant(s)
Mr. Avi Tandon, Adv.
Mr. Anish Agarwal, Adv.
Mr. Omar Waziri, Adv.
Ms. Vanshika Gupta, Adv.
Ms. Meghna Tandon, Adv.
 Ms. Vibhooti Malhotra, AOR
For Respondent(s)
 Mr. Dhananjai Jain, AOR
Mr. George Thomas, Adv.
Mr. Dhananjay, Adv.
Mr. Nakul Dewan, Adv.
Mr. Arush Khanna, Adv.
Ms. Nooreen Sarna, Adv.
Mr. Lakshay Mehta, Adv.
 UPON hearing the counsel the Court made the following
 O R D E R
Admitted.
The appeals are disposed of in terms of the signed order.
Pending application(s), if any, shall stand disposed of.
(MANISH SETHI) (SAROJ KUMARI GAUR)
COURT MASTER (SH) BRANCH OFFICER
(Signed reportable judgment is placed on the file)