Incorporation of one-sided clauses in an agreement between builders and flat purchasers tantamounts to unfair trade practice

A flat purchaser entered into an agreement to buy a flat for 4 crores. The possession of the flat was delayed beyond the agreed period because Occupation Certificate (OC) application was delayed by 2 years. Purchaser filed a consumer complaint asking for a refund, though builder has by then completed the project and was ready to offer possession. NCDRC ruled in favour of the purchaser.  Builder appealed to SC. SC found that the flat purchase agreement terms to be one sided in favour of the builder with incongruous remedies. Hence, SC held the one sided contract to be an “unfair trade practice” under Section.2(r) of the Consumer Protection Act, 1986.   SC concluded as “In view of the above discussion, we have no hesitation in holding that the terms of the Apartment Buyer’s Agreement dated 8th May, 2012 were wholly one-sided and unfair to the Respondent – Flat Purchaser. The Appellant – Builder could not seek to bind the Respondent with such one-sided contractual terms” and order a refund along with interest determined by the NCDRC & dismissed the appeal of the builder.

[Pioneer Urban vs. Govindan Raghavan (SC, 2019] priority47 \l

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