FINE LINE BETWEEN CONSUMER, INVESTOR

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The National Consumer Disputes Redressal Commission (NCDRC) has observed that a person who invests in real estate simply to earn income or benefit from capital appreciation is an investor, as distinct from a consumer who buys goods or avails of service for his own use. So, for a consumer complaint to be maintainable, the buyer must fit within the definition of consumer under the CPA. The observations came in the case of Saavi Gupta, who had purchased four properties, including a penthouse apartment from Omxame Azorim Developers. Her father, Dr Sanjeev Gupta, had contributed the money for its purchase and was dealing with the builder on her behalf. Till November 2010, the Guptas had paid several installments, though not by due dates. In December 2010, the builder sent a letter intimating that the price of the penthouse apartment had been revised from  Rs 4.04 cr to Rs 4.35 cr. The Guptas protested against the unilateral revision in price. The builder did not pay heed but merely extended the time for making payments and thereafter cancelled the booking. The Guptas then filed a complaint before the NCDRC, claiming they should be re-allotted the apartment at the original rate, or be awarded a compensation of Rs 5 cr, along with 24 percent interest. The commission observed that all the four properties had been booked in the same name. In his affidavit, Dr Gupta had explained that the penthouse apartment was purchased to improve his daughter Saavi’s future and marriage prospects; the second property was purchased for himself, his wife and his parents and the third property was purchased for his minor son. The commission noted that the affidavit was silent about the fourth property. The maintainability of the dispute would hinge on whether the Guptas could be termed “consumers” or not. This required the commission to ascertain the objective behind the purchase of the four properties, viz to earn profits, self-employment, or for own use. Dismissing the complaint, the commission held that the Guptas could not be considered consumers as the properties in question had been purchased as an investment for profit.

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