Order Date: Not Mentioned
Order Name: Central Academy Educational Society Ajmer Vs. M/S. Jain Construction Company
Case No.: F.A. No. 1177/2014
The National Consumer Disputes Redressal Commission, led by Mr. Subhash Chandra, has reinforced that the law of limitation must be strictly followed. Complaints need to be filed within the designated timeframe, and this period cannot be extended based on discussions or correspondence, as these do not count as continuing actions.
### Brief Facts of the Case
An educational institution, Central Academy, entered into a contract with Jain Construction Company to build a school. The institution paid an advance of ₹10 lakhs. However, the construction company allegedly failed to complete the work as agreed, causing a loss of ₹28 lakhs in potential school fees due to delayed classes. Additionally, the construction was reportedly of poor quality, despite the company charging higher-than-market rates. The institution sought ₹28 lakhs for lost fees, ₹48,02,723 for substandard construction and repairs, and ₹10 lakhs for overall deficiency in service from the State Commission of Rajasthan. When the State Commission dismissed the complaint, the institution appealed to the National Commission.
### Contentions of the Construction Company
Jain Construction Company argued that the educational institution did not make timely payments as required by the contract. Consequently, the company filed a suit to recover ₹22,50,560 in the Court of Additional District & Sessions Judge, Ajmer. The construction company claimed that the institution’s complaint to the State Commission was an attempt to avoid paying the outstanding amount. They asserted that the work was completed and the building handed over as per the contract. The company also argued that the complaint was not filed within the two-year limitation period, rendering it time-barred and non-maintainable due to the commercial and civil nature of the dispute.
### Observations by the National Commission
The National Commission focused on two main issues: whether the complainant qualifies as a “consumer” under Section 2(1)(d) of the Consumer Protection Act, 1986, and whether the complaint was filed within the prescribed limitation period. Referring to the case of Laxmi Engineering Works Vs P.S.G. Industrial Institute (1995) 3 SCC 583, the Commission noted that availing construction services for running a school does not automatically qualify as a commercial purpose.
Regarding the limitation period, the Commission pointed out that the construction was completed and the building handed over shortly after the agreed date. The complainant argued that the limitation period should start from a later date when discussions occurred, but the Commission rejected this, citing Shakti Bhog Food Industries Limited vs. Central Bank of India & Anr. (2020) 17 SCC 260. This case emphasized that the limitation period cannot be extended based on discussions or letters. The Commission also referenced State Bank of India vs B S Agriculture Industries (I) (2009) 5 SCC 121, underscoring the importance of strictly applying the law of limitation.
The complainant did not provide sufficient reasons for the delay in filing the complaint, which the Commission viewed as a routine and casual approach rather than a legitimate cause. The burden of proving sufficient cause for the delay was on the complainant, as explained in Basawaraj & Anr. Vs. The Spl. Land Acquisition Officer, 2013 AIR SCW 6510, and Anshul Aggarwal Vs. New Okhla Industrial Development Authority (2011) 14 SCC 578. Since the complainant approached the Commission four years late, claiming a continuing cause of action, the Commission dismissed the appeal as barred by limitation and upheld the State Commission’s order.
### Takeaway
This ruling highlights the importance of adhering to the prescribed limitation period when filing complaints. Delays without a valid reason can result in the dismissal of the case, emphasizing the need for timely action in consumer disputes.
