Individual lawsuit or class lawsuit in a builder-homebuyer dispute

Whether one should go for individual lawsuits or class lawsuits in India in a consumer dispute


The best possible way to get a relief for homebuyers with common interests and grievances in a housing project is to come together as one group and file a class action lawsuit against a builder under Section- 12 (1) (c) of the Consumer Protection Act.

The objective behind permitting a class action lawsuit against a builder is to facilitate the decision of a consumer dispute in which a large number of consumers are interested. There should be no need for each of them to file individual complaints. It is necessary for such a complaint to be filed on behalf of or for the benefit of all the persons having such a community of interest.

The National Consumer Disputes Redressal Commission (NCDRC) has already clarified that all homebuyers in a housing project who may or may not have filed cases against developers are eligible for compensation or benefits.

Moreover, a larger Bench of the NCDRC has said that a complaint filed for the benefit of or on behalf of all allottees of a project irrespective of the size of their flats or plots, date of purchase and price paid for property who have a common grievance (i.e. delay in delivery) would be maintainable under Section- 12 (1) (c) of the Consumer Protection Act. The relief claimed will be identical in case the builder fails to deliver on time or give a refund “with or without compensation claimed for all of them,” the Bench interpreted when issues relating to the concerned Section were referred to it.

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