Dominant test- commercial purpose
Mere
fact that Opposite Party is a real estate company does not mean that flat was purchased
for commercial purpose[1]
Shubham
Budhiraja[2]
(i)
To determine whether the goods purchased by a
person (which would include a legal entity like a company) were for commercial
purpose or not within the meaning of the Act would depend upon the facts and
circumstances of each case.
(ii)
However, ordinarily “commercial purpose” is understood
to include manufacturing/industrial activity or business-to-business
transactions between commercial entities. The purchase of the goods should have
a close and direct nexus with a profit generating activity.
(iii)
If it is found that the dominant purpose
behind purchasing the goods was for the personal use and consumption of the
purchaser and/or the beneficiary, or was otherwise not linked with other
commercial activities, the question whether such a purchase was for the purpose
of “generating livelihood by means of self-employment” need not be looked into.
(iv)
In short, the dominant intention or the
dominant purpose of the transaction is to be looked into to find out if it had
any nexus with some kind of profit generation as part of the commercial
activities.
[1] CIVIL
APPEAL NO.858 OF 2023
[2]
LLB, ACS, BCOM(H), Advocate, Delhi High Court, Budhirajalawchambers@gmail.com
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