Citation – T.K.A. Padmanabhan v. Abhiyan Cooperative Group Housing Society Ltd., Civil Appeal No. 10724 of 2016, decided on 4 June 2026 (SC).

ISSUE

1. If there is a case wherein a dispute is admitted by the Consumer Forum and whether such dispute may be submitted to arbitration based on the presence of an arbitration clause within the contract.
2. Whether the allottee who has possession of a flat will not be treated as “consumer” anymore and thus entitled to claim delay in delivery of possession.

RULE

Statutory provisions

Section 3, Consumer Protection Act, 1986

Remedies that may be claimed in accordance with the Consumer Protection Act are in addition to those that may be available from any other source.

Section 12(4), Consumer Protection Act, 1986

Once a complaint has been admitted, it shall not be transferred to any other court, tribunal, or authority constituted by any other law.

Section 2(1)(d)

Definition of ‘consumer’ – A person who hires or avails himself of services for a consideration.

Section 2(1)(o)

Definition of ‘service’ – Includes housing construction service.

Judicial Precedents Relied Upon

Fair Air Engineers Pvt. Ltd. v. N.K. Modi, Citation: (1996) 6 SCC 38

1. Consumer remedy is additional.
2. Arbitration clause does not oust consumer forum jurisdiction.

Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha Citation: (2004) 1 SCC 305

1. Consumer remedies survive despite alternative statutory remedies.

National Seeds Corporation Ltd. v. M. Madhusudhan Reddy, Citation: (2012) 2 SCC 506

1. Availability of another remedy does not bar a consumer complaint.

Emaar MGF Land Ltd. v. Aftab Singh, (2019) 12 SCC 751

1. Arbitration agreements cannot deprive consumers of jurisdiction.

ANALYSIS

Issue 1– Impact of Arbitration Clause on Consumer Jurisdiction

The Supreme Court noted that the Consumer Protection Act, 1986 is welfare legislation meant to provide consumers with redress in a speedy, inexpensive and simple manner. It was stressed that Section 3 clearly preserves the rights of consumers despite any other remedy being available to the parties. The Supreme Court heavily leaned on its earlier judgment in Emaar MGF Land Ltd. v. Aftab Singh wherein the principle had already been laid down that an arbitration agreement cannot override the statutory jurisdiction of consumer forums.

Additionally, the Court considered Section 12(4) of the Consumer Protection Act which expressly provides for non-transferability of an admitted complaint to any other forum.

It was said that: Once the complaint has been admitted, Then it is statutorily required to be decided by the consumer forum under the Consumer Protection Act, and there can no longer be any diversion to arbitration just because there is a provision in the contract to that effect. Private contractual provisions can never override statutory rights conferred by Parliament.

In view of the above, the District Forum, State Commission, and National Commission made an erroneous referral to arbitration.

Issue 2 – Whether the Taking of Possession Terminates Consumer Status

The National Commission had rejected the revision petition on the grounds that the appellant had taken possession of the flat and thus no longer remained a consumer. The Supreme Court did not accept this line of argumentation.

According to the Supreme Court: The dispute was not one for possession. It was about the compensation for the delay in giving possession. Claiming delay in giving possession implies an incident happening before delivery of possession. Delivery of possession does not terminate the allottee’s claim for compensation for the previous delay.

The Court ruled that whether or not: delay has occurred; the delay was due to the society; possession was taken without any conditions; compensation is payable; were all facts to be determined by the court.

As these facts had not been determined by any consumer forum, the case was prematurely dismissed.

CONCLUSION

I fully concur with the decision rendered by the Supreme Court in the case of T.K.A. Padmanabhan v. Abhiyan Cooperative Group Housing Society Ltd., since the decision serves as a means of protecting the consumer rights and serving the intent of the Consumer Protection Act of 1986. It was rightly decided that the existence of the arbitration agreement cannot bar the consumer from seeking the remedy of law through consumer courts. It was also rightly observed that mere possession of the flat shall not bar the claim of the complainant for delay in delivery of the property. The claims shall be considered based on their merit. The decision of the Court in restoring the complaint for consideration was fair and just.