Determination of Pecuniary Jurisdiction under the Consumer Protection Act, 1986 in Real Estate Disputes

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Builder-buyer disputes are not a new phenomenon in India. Many buyers are now willing to against the builder before the appropriate forum. The important question which then arises is how to determine the pecuniary jurisdiction for filing the consumer complaint before the appropriate forum?

Let us first analyse the legislative framework under the Consumer Protection Act, 1986. As per the said Act, if the value of goods or services and compensation does not exceed 20 Lakhs, the complaint shall lie before District Forum. If the value is more 20 Lakhs and less than 1 Crore, the complaint shall lie before State Commission and if the value exceeds 1 Crore, the complaint shall lie before the National Commission.

But what if the total value of the property is 80 Lakhs and the consumer had deposited and only 10 Lakhs with the builder and is now seeking refund? Should the jurisdiction be determined as per the total value of the property (i.e. 80 Lakhs) or the initial deposit made by the consumer (i.e. 10 Lakhs)?

As per the recent order of the National Consumer Disputes Redressal Commission in the case of Gurmukh Singh v. Greater Mohali Area Development Authority & Anr, it is the total value of the property which shall determine the pecuniary jurisdiction and not the relief claimed by the consumer.

Therefore, in the present example, the State Commission shall have the pecuniary jurisdiction and not the district forum to entertain the complaint as the total value of the property is more that 20 Lakhs and less that 1 Crore.

Disclaimer – the above summary is based on the personal interpretation of the revised regulations, which may differ person to person. Hence, the readers are expected to take expert opinion before placing reliance on this article.

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