'Unfair prices cannot be passed off as sales strategy'

Published on Nov 24, 2006 02:56 AM IST

Builders cannot fix an arbitrary price and then claim that it is not an unfair trade practice but a sales strategy, the State Consumer Disputes Redressal Forum has ruled, reports Abhishek Bhalla.

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None | ByAbhishek Bhalla, New Delhi

Builders cannot fix an arbitrary price and then claim that it is not an unfair trade practice but a sales strategy, the State Consumer Disputes Redressal Forum has ruled.

The court made the observation while hearing an appeal by Krishan Lal who purchased a shop in DLF Dilshad Plaza for Rs 5,70,465 but found out that shops of similar size in the same area were being sold for Rs 1.50 lakh only.

Lal stopped paying after he had shelled out Rs 2,34,507 in installments. He then moved court questioning the plaza's pricing. The court has directed that the builders should not demand more than the amount Lal has already paid for the shop.

DLF argued in court that they had offered some shops at lower price as a strategy and that pricing of a property does not come within the ambit of consumer dispute.

Counsel for DLF told the court that since shops at the earlier quoted price were not being sold, the price was lowered to sell the shops constructed in the same area.

The court was not impressed. "What kind of market strategy is this?" it asked. Had there been a reasonable difference between the two prices, the plea that it was a sales tactic would have been acceptable. "Fixing the price of property is one thing, but fixing price in unrealistic, irrational and exploitative manner gives the impression to the consumer that he has been cheated," said Justice JD Kapoor, president of the forum. 

He made it clear that there can be no inference drawn from the deal other than unfair treatment meted to earlier buyers.

"If the question of pricing is taken out from the ambit of unfair trade practice there would be no check upon the practices which are of misleading nature," he added.

Email Abhishek Bhalla: abhishek.bhalla@hindustantimes.com

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