Case BriefsTribunals/Commissions/Regulatory Bodies

Delhi State Consumer Disputes Redressal Commission (DSCDRC): On finding deficiency in providing services, Coram of Dr Justice Sangita Dhingra Sehgal (President) and Anil Srivastava (Member), held that the builder gave false assurances to the complainant with regard to handing over the buyer for delivery of possession.

The instant complaint was filed under Section 17 of the Consumer Protection Act alleging deficiency of service and unfair trade practices.

In the year 2010, Mr M.K. Arora booked a unit in the project of OP. The Builder Buyer agreement was executed between the parties after the expiry of 4 years from the date of the first payment made to the OP.

As per the said agreement, the OP was supposed to hand over the possession of the said office space from the date of signing of the above-stated agreement, however, till date the possession has not been handed over by the OP. Along with this, OP unilaterally changed the size of the said unit which escalated the cost of the unit.

Allottee kept paying the OP as and when demanded by it. Later the allottee sent a legal notice to the OP asking for refund.

Analysis, Law and Decision

Deficiency of Service

Whether OP is actually deficient in providing its services to the complainant or not?

As per clause 3(a) of the Builder Buyer Agreement, OP was bound to handover the possession of the said office space within 3 years from the date of signing of the said agreement.

OP executed the said builder buyer agreement after a period of 4 years from the date of the first payment received from the allottee.

It has been well settled that the complainant cannot be expected to wait for an indefinite time period to get the benefits of the hard-earned money that they have spent in order to purchase the property in question. [Ref: Fortune Infrastructure v. Trevor D’ Lima, (2018) 5 SCC 442]

In view of the above, it was held that OP was deficient in providing its services to the complainant as the OP had given false assurance to the complainant with respect to the time for delivery of possession of the said office space and kept the hard-earned money of the complainant for about 11 years.

The commission directed OP to refund the amount paid by the complainants. [Promila Arora v. Landmark Apartments (P) Ltd., Complaint Case No. 152 of 2018, decided on 29-11-2021]


Advocates before the Commission:

Complainants: Mr Sumit K Batra, Advocate

Opposite Party: Nida Doon & Simranjeet Singh, Advocate

Case BriefsDistrict Court

Delhi State Consumer Disputes Redressal Commission: Coram comprising of Dr Justice Sangita Dhingra Sehgal (President) and Anil Srivastava (Member) addressed a grievance pertaining to loss of photos either due to the Nikon Camera or Memory Card leading to the filing of the consumer complaint.

Facts that led to the present complaint

Complainant was the owner of a Nikon Digital Camera and he took the same camera on a trip to Europe to shoot some memorable photos. After a few days, the said camera started showing a warning to the effect that any further use shall delete all data due to which the complainant switched off the camera and stopped using it.

On return to India, the complainant informed OP-2 of the said fault which had occurred in the camera along with the memory card, who informed him that there was nothing wrong with the camera but the data card had been corrupted.

Complainant left the memory card with Op-2 in their shop for retrieving the data but it proved futile and complainant was told that the memory card will shown at the service centre of Op-1. However, after two weeks the memory card was returned telling the complainant that the retrieval of the data was not possible because the memory card had been totally damaged. It is further alleged that Op-2 offered a replacement of the faulty memory card which complainant declined. It is also stated that later on, Op-2 informed that the memory card was faulty and it was a defective product supplied by OP-3.

Complainant had filed the consumer complaint against all the OPs seeking Rs 5,00,000 compensation for the loss, mental agony and harassment.

District Forum

In District Forum’s opinion, all three OPs were at fault and deficient in providing the service to the complainant, hence liable to compensate the complainant for sufferance of any loss, mental agony and harassment.

Hence each OPs were directed to pay an amount of Rs 25,000

Present Complaint

Nikon impugned the District Forum’s Order on the ground that the Forum erred in not appreciating the fact that the actual problem was with the Memory Card alone and the camera manufactured by the Nikon was in proper working condition.

Further, it was stated that the District Forum failed to take into consideration the warranty clauses that clearly excluded the liability of Nikon from damage occurring due to improper care, misuse, etc.

Crux 

Whether Nikon is liable for Deficiency of Service and has caused mental agony and /or harassment to Respondent 1/Complainant due to Memory Card getting corrupted which was installed in the said camera?

Bench noted that Nikon was neither the manufacturer, dealer, importer, wholesaler of the Memory Card which got corrupted leading to the loss of the photos.

Further, there was nothing on record to show that the loss of photos was caused due to any malfunction of the camera.

Adding to the above, it was stated that Complainant did not face any issue with the Camera and was fully aware that the loss, if any, was caused by the corruption of the Memory Card only and not due to any other reason.

Therefore, order of the District Forum, restrictively to the finding whereby it has held the present Appellant/Nikon liable for loss, mental agony was set aside. [Nikon (P) Ltd. v. K. Prabhakran, First Appeal No. 859 of 2013, decided on 15-07-2021]


Advocates before the Commission:

Mr Saksham Tyagi, Counsel for the Appellant.

None for the Respondents.

Law made Easy

[Disclaimer: This note is for general information only. It is NOT to be substituted for legal advice or taken as legal advice. The publishers of the blog shall not be liable for any act or omission based on this note]

The interest of the consumer has to be kept in the forefront and the prime consideration that an essential commodity ought to be made available to the common man at a fair price must rank in priority over every other consideration.”

Y.V. Chandrachud, J. in Prag Ice & Oil Mills v. Union of India, (1978) 3 SCC 459

 Introduction

“An Act to provide for protection of the interests of consumers and for the said purpose, to establish authorities for timely and effective administration and settlement of consumers’ disputes and for matters connected therewith or incidental thereto”

The long title of the new Consumer Protection Act, 2019 (“2019 Act”) in the least number of words explains the whole and sole purpose of the Act. While the Consumer Protection Act, 1986 had nearly the same long title, but being around three decades old, did not inculcate the needful things that would have solved the problems of the modern and technology-dependent consumers, which is why a need was felt to replace the whole Act with a new one and bring a fundamental change.

The Parliament passed the Consumer Protection Bill, 2019 on 06-08-2019 to replace the Consumer Protection Act, 1986. The President of India gave its accent to the 2019 Act on 09-08-2019 and the same came into force on 20-07-2020. The 2019 Act has been enacted for the purpose of providing timely and effective administration and settlement of consumer disputes and related matters.

Related Read:

Substantial portion of Consumer Protection Act, 2019 along with related Rules to come into force on 20th July, 2020

Consumer Protection Act, 2019 comes into force from today

Brief History of Consumer Protection Act in India

Consumer Protection has always been a matter of great concern. In ancient India, effective measures were initiated to protect consumers from crimes in the market place. Ancient law-givers ably described various kinds of unfair trade practices and also prescribed severe punishments for wrongdoers. Mainly, acts of adulteration and false weights and measures were seriously dealt with.

In the medieval period, some Muslim rulers developed well-organized market mechanisms to monitor prices and the supply of goods to the markets. During the British period, the modern legal system was introduced in India and many laws were enacted to protect the interests of consumers generally.

Some of the laws which were passed during the British regime concerning consumer interests were: the Contract Act of 1872, the Sale of Goods Act of 1930, the Penal Code of 1860, the Drugs and Cosmetics Act of 1940, the Usurious Loans Act of 1918, and the Agriculture Procedure (Grading and Marketing Act) of 1937. These laws provided specific legal protection for consumers.

Today, the civil justice system is tainted with deficiencies that discourage the consumer from seeking legal recourse. However, the Consumer Protection Act of 1986, which provided easy access to justice, had brought a legal revolution in India as a result of its cost-effective mechanisms and popular support. However, with the gradual advancements in technology, the age-old 1986 Act was unable to keep up with the grievances of the modern consumer. Thus, a need was felt to substitute the old Act which resulted in the enactment of the Consumer Protection Act, 2019.

Key features of the Consumer Protection Act, 2019

  • The new Act which was drafted keeping in mind the needs of the modern consumers incorporates new terminologies which had no place in the old Act. Under Section 2(1)advertisement” is defined as any audio or visual publicity, representation, endorsement or pronouncement made by means of light, sound, smoke, gas, print, electronic media, internet or website and includes any notice, circular, label, wrapper, invoice or such other documents; which means that now a consumer who is aggrieved due to some kind of misleading advertisement can approach the authorities concerned seeking relief.
  • A provision for a minor being a consumer has been introduced under Section 2(5)(vii) of the Act where the parent or legal guardian can approach the authorities through the minor seeking relief.
  • A new clause of “product liability action[Section 2(35)] has been added with definition of “complaint” under Section 2(6)(vii) which lies against the product manufacturer [Section 2(36)], product seller [Section 2(37)] or product service provider [Section 2(38)] as the case may be.
  • Under the new Act, “consumer” is defined under Section 2(7) as a person who “buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose” or “hires or avails of any service for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such service other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person, but does not include a person who avails of such service for any commercial purpose.”

Thus, a consumer will now mean any person who “buys any goods” and “hires any services” which shall include both online and offline transactions through electronic means, teleshopping, direct selling or multi-level marketing.

  • The most important feature of the new Act definitely being the rights of the consumer under Section 2(9), which includes,
    • the right to be protected against the marketing of goods, products or services which are hazardous to life and property;
    • the right to be informed about the quality, quantity, potency, purity, standard and price of goods, products or services, as the case may be, so as to protect the consumer against unfair trade practices;
    • the right to be assured, wherever possible, access to a variety of goods, products or services at competitive prices;
    • the right to be heard and to be assured that consumer’s interests will receive due consideration at appropriate fora;
    • the right to seek redressal against unfair trade practice or restrictive trade practices or unscrupulous exploitation of consumers; and
    • the right to consumer awareness.
  • Section 2(10) and 2(11) of the Act talk about “defect” and “deficiency” “Defect” means any fault, imperfection or shortcoming in the quality, quantity, potency, purity or standard which is required to be maintained by or under any law for the time being in force or under any contract, express or implied or as is claimed by the trader in any manner whatsoever in relation to any goods or product and the expression “defective” shall be construed accordingly; whereas “deficiency” means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service and includes—(i) any act of negligence or omission or commission by such person which causes loss or injury to the consumer; and

(ii) deliberate withholding of relevant information by such person to the consumer.

  • The new additions include “e-commerce” Section 2(16), “electronic service provider” Section 2(17) along with the prescribed liabilities in relation to internet frauds. This has broadened the scope of the Act and it looks after the better protection of the rights of e-consumers and also enables them to proceed against e-commerce websites in the event of any infringement or violation.
  • Thereafter, a series of new terminologies have been added to Section 2 of the Act, for example a brand new concept of “product liability” has been included in the new Act which has been defined under Section 2(34) of the Consumer Protection Act, 2019 as “the responsibility of a product manufacturer or product seller, of any product or service, to compensate for any harm caused to a consumer by such defective product manufactured or sold or by deficiency in services relating thereto;” and in lieu of which the concepts of “product liability action”, “product manufacturer” etc. have also been included in the Act.

Central Consumer Protection Authorities

One of the major drawbacks of the previous Act was that there were no protection authorities in order to keep check, regulate and address the grievances of the consumers in an effective and speedy manner. Chapter III of the 2019 Act provides with the Central Consumer Protection Authority (CCPA) which has been added in order to regulate matters relating to violation of rights of consumers, unfair trade practices and false or misleading advertisements which are prejudicial to the interests of public and consumers and to promote, protect and enforce the rights of consumers as a class. Central Authority shall consist of a Chief Commissioner and such number of other Commissioners as may be prescribed, to be appointed by the Central Government to exercise the powers and discharge the functions under this Act. It will consist of an investigation wing headed by a Director-General for the purpose of conducting inquiry or investigation under this Act as may be directed by the Central Authority.

An appeal to an order passed by the CCPA on this issue can be filed before the National Commission within a period of 30 days from the date of the receipt of such order.

How to make a complaint?

Section 17 states that a complaint relating to violation of consumer rights or unfair trade practices or false or misleading advertisements which are prejudicial to the interests of consumers as a class, may be forwarded either in writing or in electronic mode, to any one of the authorities, namely, the District Collector or the Commissioner of Regional Office or the Central Authority.

The Central Authority under Section 21 has been provided with the powers to issue directions and penalties against false or misleading advertisements.

Consumer Dispute Redressal Commission (CDRC)

Chapter IV of the Act deals with the Establishment, Qualifications, Jurisdiction, Manner of Complaint, Proceedings etc. regarding the Consumer Disputes Redressal Commission. CDRC is empowered to resolve complaints with respect to unfair and restrictive trade practices, defective goods and services, overcharging and goods which are a hazard to life and safety. It has to be set up at three levels, i.e. the District, State and National levels (commissions). In comparison to the old Act, the jurisdictions of the commissions have been enhanced.

      District Consumer Disputes Redressal Commission (previously known as the District Forum):

District Commission shall consist of a President and not less than two and not more than such number of members as may be prescribed, in consultation with the Central Government. The District Commission now has the jurisdiction to entertain complaints where the value of the goods and services paid as consideration does not exceed one crore rupees. Section 34(2)(d) categorically states that the complaint can now also be instituted in a District Commission within the local limits of whose jurisdiction the complainant resides or personally works for gain, apart from filing in the jurisdiction where the other side actually or voluntarily resides, or carries a business, or has a branch office or personally works for gain.

      State Consumer Disputes Redressal Commission (previously known as the State Commission):

The State Commission shall have jurisdiction to entertain the complaints where the consideration exceeds one crore rupees but does not exceed ten crore rupees.

      National Consumer Disputes Redressal Commission (previously known as the National Commission):

The National Commission shall have the jurisdiction to entertain complaints where the consideration paid exceeds ten crore rupees.

The jurisdiction in which the complaint is to be filed is now on the basis of the value of the goods and services paid, which was not the case in the 1986 Act where it was on the value of the goods and services and the compensation, if any, claimed. A great emphasis has been placed on mediation which will be dealt with further.

Mediation

The Act has introduced a new chapter (Chapter V) on mediation as an alternate dispute resolution mechanism in order to resolve the consumer dispute in a much faster way without having to approach the Commissions. Thus, in the events where the mediation is successful in whole, the terms of such agreement shall be reduced into writing accordingly. Where the dispute is settled only in part, the Commission shall record the statement of the issues which have been settled, and shall continue to hear the remaining issues involved in the dispute. In case of unsuccessful mediation the respective Commission shall within seven days of the receipt of the settlement report, pass a suitable order and dispose of the matter accordingly.

Offences and Penalties

Section 21(2) and Section 89 of the 2019 Act provides the Central Authority with the power to impose a penalty in respect of any false or misleading advertisement, by a manufacturer or an endorser, it may, by order, impose on manufacturer or endorser a penalty which may extend to ten lakh rupees. Apart from this, a separate chapter (Chapter VII) for offences and penalties has been introduced where detailed penalties and punishments have been mentioned in relation to non-compliance, or manufacturing for sale or storing, selling or distributing or importing products that are adulterated or spurious.

Related Rules and Regulations

  • The Consumer Protection (E-Commerce) Rules, 2020 which are mandatory and are not advisories, lay down all the important information relating to the e-commerce entities keeping in mind both the consumer and the product/service provider. Key highlights are:
    • E-commerce entities according to Rule 5 are required to provide information to consumers, relating to return, refund, exchange, warranty and guarantee, delivery and shipment, modes of payment, grievance redressal mechanism, payment methods, security of payment methods, charge-back options and country of origin.
    • These platforms will have to acknowledge the receipt of any consumer complaint within 48 hoursand redress the complaint within one month from the date of receipt. They will also have to appoint a grievance officer for consumer grievance redressal.
    • Sellers cannot refuse to take back goods or withdraw services or refuse refunds,if such goods or services are defective, deficient, delivered late, or if they do not meet the description on the platform.
    • The rules also prohibit the e-commerce companies from manipulating the priceof the goods or services to gain unreasonable profit through unjustified prices.
  • As per the Consumer Protection (Consumer Disputes Redressal Commissions) Rules, 2020 which came into force on 20th July 2020, the amount of fee payable for filing the complaint in the District Commission up to Rs 5 lakhs has been made Nil according to Rule 7.
  • The credit of the amount due to unidentifiable consumers will go to the Consumer Welfare Fund(CWF).
  • State Commissions will furnish information to the Central Government on a quarterly basis on vacancies, disposal, the pendency of cases and other matters.
  • Apart from these general rules, there are Central Consumer Protection Council Rules, provided for the constitution of the Central Consumer Protection Council(CCPC).
    • It will be an advisory body on consumer issues, headed by the Union Minister of Consumer Affairs, Food and Public Distribution with the Minister of State as Vice Chairperson and 34 other members from different fields.
    • It will have a three-year tenure and will have Minister-in-charge of consumer affairs from two States from each region: North, South, East, West, and North-East Region.

Conclusion

The 2019 Act is a much required change in favor of the consumers considering the current age of digitization. It empowers them with clearly defined rights and dispute resolution process which will enable them to get their grievance addressed with a fast track mechanism.

In order to have a better understanding of the concepts have a glance over some of the landmark judgments given by our Courts according to the Consumer Protection Act, 1986 which is now repealed but the guidelines laid down in those cases helped in framing the new Consumer Protection Act, 2019.

  • The Delhi High Court while examining the concept of advertisement decided the case of,

 Horlicks Ltd. v. Zydus Wellness Products Ltd., 2020 SCC OnLine Del 873

The High Court passed an interim order restraining Zydus from telecasting its advertisement comparing Complan to Horlicks on the grounds that the same was misleading and disparaging. The Court relied on various judgments on misleading advertisements, disparagement and law governing publication of advertisements on television. Major decisions were:

Dabur (India) Ltd. v.  Colortek (Meghalaya) (P) Ltd., 2010 SCC OnLine Del 391

The Delhi High Court culled out the principles governing disparagement in the advertisements and held:

On the basis of the law laid down by the Supreme Court, the guiding principles for us should be the following:

(i) An advertisement is commercial speech and is protected by Article 19(1)(a) of the Constitution.

(ii) An advertisement must not be false, misleading, unfair or deceptive.

(iii) Of course, there would be some grey areas but these need not necessarily be taken as serious representations of fact but only as glorifying one’s product.

To this extent, in our opinion, the protection of Article 19(1)(a) of the Constitution is available. However, if an advertisement extends beyond the grey areas and becomes a false, misleading, unfair or deceptive advertisement, it would certainly not have the benefit of any protection.

 Pepsi Co. Inc. v. Hindustan Coca Cola Ltd., 2003 SCC OnLine Del 802

In Pepsi Co. it was held that certain factors had to be kept in mind while deciding the question of disparagement. Those factors were:

(i) Intent of the commercial,

(ii) Manner of the commercial, and

(iii) Story line of the commercial and the message sought to be conveyed.

These factors were amplified or restated in the following terms:

“(1) The intent of the advertisement – this can be understood from its story line and the message sought to be conveyed.

(2) The overall effect of the advertisement – does it promote the advertiser’s product or does it disparage or denigrate a rival product?

In this context it must be kept in mind that while promoting its product, the advertiser may, while comparing it with a rival or a competing product, make an unfavorable comparison but that might not necessarily affect the story line and message of the advertised product or have that as its overall effect.

(3) The manner of advertising – is the comparison by and large truthful or does it falsely denigrate or disparage a rival product? While truthful disparagement is permissible, untruthful disparagement is not permissible.”

Related Read:

Advertisement to Misleading Advertisement | Horlicks Ltd. v. Zydus Wellness Products

The complainant/respondent had participated in Mc Donald’s widely published scheme ‘Mc Donald’s Mein Khao Har Bar Prize Le Jao’ by placing two separate orders worth Rs 81. It was alleged by the complainant that Connaught Plaza Restaurants Ltd. (CPRL) a franchisee running Mc Donald restaurants has indulged in unfair trade practices by not giving the assured prizes as per the scheme, rather put the participants under the obligation to make a further purchase of a minimum Rs 20 in order to avail free French Fries. Also, the complainant had to send two SMS giving the coupon numbers, for which Rs 3 per SMS were charged. Moreover, the details of the entire scheme with its terms and conditions and the result of the winners were also concealed from the participating customers. Therefore, the complainant filed a consumer complaint before the District Forum praying to declare the scheme as unfair trade practice and that Connaught Plaza Restaurants Ltd. be directed to disclose the entire scheme and winners of the prizes. The District Forum allowed the complaint and awarded compensation and costs to the complainant of Rs. 10,000 and Rs.2,000.

Aggrieved, CPRL filed an appeal before the State Commission, but the State Commission modified the order of the District Forum by enhancing the compensation and awarding punitive damages to the tune of  Rs. 2,00,000 and Rs. 10,00,000.

CPRL then appealed before the NCDRC. The NCDRC held that no proof had been filed by the complainant that CPRL had collected the SMS charges or that it had an agreement with the Telecom Company/Service provider on sharing of SMS charges. Thus, the order of the State Commission could not be sustained on those grounds. On the other hand, it held that it is also true that the scheme was an unfair trade practice followed by Connaught Plaza Restaurants Ltd. This fact having been established by the concurrent findings given by the District and the State Commission. The complainant and other similar customers who may not have come forward to file a complaint need to be granted relief. Partly allowing the appeal, the NCDRC reduced the amount of compensation to Rs. 30,000 and costs to Rs. 70,000 respectively.

  • The National Consumer Disputes Redressal Commission (NCDRC) in the recent case of, Ernakulam Medical Centre P.R. Jayasree, 2020 SCC Online NCDRC 490 observed that,

“Releasing a dead body by a hospital to an unrelated third person unquestionably constitutes ‘deficiency in service’ within the meaning of Section 2(1)(g) and (o) of Consumer Protection Act, 1986.”

Related Read:

NCDRC | Releasing a dead body by a hospital to an unrelated third person unquestionably constitutes ‘deficiency in service’ within the meaning of S. 2(1) (g) & (o) of Consumer Protection Act, 1986

  • Recently, the Supreme Court in a judgment laid emphasis on the role of NCDRC in Union of India N.K. Srivastava, 2020 SCC OnLine SC 636, wherein the Court had dismissed an appeal which had aroused from an order of the National Consumer Disputes Redressal Commission. The complaint alleged medical negligence against Sarvodaya Hospital and Safdarjung Hospital. The NCDRC allowed the revision of Sarvodaya Hospital. While exonerating it of the finding of medical negligence, it held Safdarjung Hospital liable to pay the compensation of Rs 2 lakhs imposed by the State Consumer Disputes Redressal Commission.

The District Forum had dismissed the consumer complaint stating that there was no deficiency on the part of Sarvodaya Hospital in referring the complainant to a specialized facility. An appeal was filed before the State Consumer Disputes Redressal Commission by the original complainant. The SCDRC, by its judgment concluded that Sarvodaya Hospital was guilty of medical negligence and directed it to pay a sum of Rs 2 lakhs as compensation and costs quantified at Rs 20,000. However, the complaint was held not to be maintainable against Safdarjung Hospital. A revision was filed against the judgment of the SCDRC by Sarvodaya Hospital before the NCDRC which allowed the revision and came to the conclusion that Sarvodaya Hospital was not guilty of medical negligence, however, the NCDRC elaborated on the question as to whether Safdarjung Hospital had been correctly exonerated. The NCDRC held that though the complainant had not filed a revision against the order of the SCDRC specifically holding that Safdarjung Hospital was not amenable to the jurisdiction of the consumer fora, he was not precluded from challenging a finding which was adverse to him in the revision petition. On these facts, the NCDRC sustained the finding of medical negligence against Safdarjung Hospital and directed it to pay compensation quantified at Rs 2 lakhs.


† Editorial Assistant (Legal)

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC): Anup K Thakur (Presiding Member), held that delivering the vehicle and withholding the documents of the said vehicle would amount to illegal delivery of the vehicle.

Factual Matrix

Respondent 1/ Complainant had purchased a Tata Spacio Car from the petitioner/OP 1. Complainant towards the purchase of the car had paid Rs 30,000 vide two cheques and Rs 8,100 separately for registration, insurance, service charges, etc., to OP 1. However, at the time of delivery, OP 1 had retained original documents of registration and insurance. OP1’s case was and continues to be that these were retained as the complainant had not paid the balance amount to him. Rs 1,15, 236 was yet to be paid after taking into account Rs 30,000 and the loan obtained from OPs 2 & 3.

In view of the above, the complainant had filed a consumer complaint alleging deficiency in service due to non-delivery of the original documents.

District Forum had accepted the complaint and directed OP 1 to send the original documents to the complainant. On appeal, State Commission also agreed with the District Forum and dismissed the appeal.

Petitioners Counsel submitted that an Ikararnama (agreement) was signed wherein complainant undertook to pay the balance amount later after taking delivery of the vehicle. On the said understanding, the vehicle was delivered to the complainant while the original documents such as registration, insurance were kept with OP 1. The case of OP-1 was that instead of paying the said amount and taking the original papers, the complainant filed a consumer complaint.

Hence, after allowing the above-stated complaint and appeal, the instant revision petition was filed.

Analysis and Decision

On considering the facts and circumstances of the instant case, the Commission stated that the revision petition cannot be sustained.

The vehicle was sold to the complainant, with the help of loan provided by OPs 2 & 3. The disputed point as per OP 1 was whether the complainant had paid the full amount to OP 1 or note. The related issue was whether the complainant was correct in alleging deficiency in service because OP 1 had retained the original documents after handing over the delivery of the car to him.

State Commission held that:

Once the vehicle has been delivered to the respondent 1, the appellant dealer cannot withhold the said documents on the plea of some dues still remaining to be paid. The delivery of the vehicle itself could have been delayed for that reason. Besides, since the purchase was financed by respondent 2 and 3, we see no reason how any amount could have been left unpaid and the appellant could still have delivered the vehicle in question to the respondent-complainant.

In the Commission’s opinion, the State Commission’s order had no material infirmity. Further, it was stated that if OP 1 had sold the vehicle and accepted the arrangement implicit in the Ikararnama, it had to bear the consequences.

“…as a responsible dealer, OP 1 could not have delivered the vehicle without the original documents. Such a delivery was illegal.”

No vehicle can legally ply without the above-stated documents.

Commission held that the factum of delivery without documents was illegal per se and certainly a deficiency in service. It is not important nor relevant as to what informal arrangement existed between OP 1 and the complainant. Whatever may have been the arrangement, it cannot justify the action of OP 1.

In view of the above discussion, the revision petition was dismissed. [Fauzdar Motors v. Lok Nath Kushwaha, 2020 SCC OnLine NCDRC 492, decided on 01-12-2020]


Advocates who appeared before the Commission:

For the Petitioner: Sanjay Sehgal, Advocate

For the Respondent:

For the Respondent 1: Nemo
For the Respondents 2 & 3: Ritu Raj, Advocate

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC): Anup K. Thakur (Presiding Member) addressed a consumer complaint alleging unfair trade practice and deficiency of service.

As per the complaint, small contagious plots of different landowners were developed by the OP. On the said plots, multi-storied buildings consisting of composite flats were constructed as per duly approved and sanctioned by the Kolkata Municipal Authority.

Complainants purchased their respective flats paying full consideration as per the market rate and executing and registering the conveyance deed.

After several complaints, the OPs failed to provide the amenities and facilities assured by them. OPs also failed to provide a Completion Certificate which a statutory requirement as per the KMC rules.

Unfair Trade Practices

Complainants sought from the OPs common amenities and facilities. Later the complainants discovered that the playground promised belonged to a local club and the pond contiguous to the complex was described by OPs as their own and shown as a beautified lake in the brochure advertisement.

Analysis & Decision

On perusal of the facts and contentions, the bench stated that the complainants have not been able to establish their complaint. Though the OPs may have indulged in unfair trade practice yet this does not help the complainant’s case.

Maintainability of the complaint

  • The complainants do not constitute a uniform group rather they own flats on different floors in different blocks and premises.

Complainants chose to come together in the present consumer complaint on some basis undoubtedly but it is not clear what the basis might have been.

In an earlier order, the Commission stated that the consumer complaint listed certain facilities that were to be provided as a common one, hence the issue of maintainability of joint complaint stood settled.

Common Facilities

  • Complainant’s stated that with the payment of the full consideration for the flat all common facilities were also automatically paid for.

Whereas OPs stated that some common facilities such as stairs, etc. indeed included in the consideration but other than these extra facilities had to be paid for.

Even the AdvocateCommisisoner’s report on the behest of the State Commission stated that some extra common facilities had already been provided and more facilities could be provided if the complainants were willing to pay for the same.

Brochure and Newspaper Advertisement

  • Bench observed that a lot was promised to the complainants by way of amenities, undoubtedly to attract customers. The fact that some of the amenities promised were not part of the deal was not disclosed by the OP.

Further, the said act was misleading and therefore an unfair trade practice.

The fact that the brochure and the advertisement differed with respect to the amenities offered and further the descriptions of the said amenities and facilities in the Agreement for Sale and the Conveyance Deed also differed does give the impression that OPs were far too casual in the present matter.

In view of the above, OPs are guilty of unfair trade practice within the meaning of Section 2(1)(r) of the Consumer Protection Act, 1986.

But the bench on noting that the complainants themselves agreed to purchase their respective flats on payment of consideration and on due execution and registration of the conveyance deed, stated that the complainants ought to have known what they were purchasing.

Why is their a joint complaint?

Commission finds suspicion with regard to filing a joint complaint and states that this may be only to pressurize the OPs into paying some compensation and/or not insisting upon extra payments for the extra facilities and amenities.

No deficiency of service can be attributed to the OP

A reading of Section 403 of the KMC Act, 1980 makes it clear that it was incumbent on both the OP as well as the complainant to not occupy the premises in the absence of a completion certificate, in view of the said, complainant and the OP are in violation of the law.

Commission dismissed the consumer complaint as the complainants failed to establish their case as the Agreement of Sale as provided by the OP also clearly stated that common facilities mentioned were under the scope of “extra facilities and amenities” and the complainant/purchaser had to pay and extra sum for that.

Hence, the complainants should have been aware of the factum of extra payment for extra facilities.

Complainants in response to the brochure saw the flat, checked the price and bought the flat which appears to be an outright sale of flats.

In view of the above, no question of deficiency of service or unfair trade practice as it would be simply a case of buyer purchasing a falt on ‘as is’ basis, if not then the complainants ought to have known what they were purchasing

Therefore, the consumer complaint was dismissed. [Debashis Sinha v. R.N.R Enterprise, 2020 SCC OnLine NCDRC 429, decided on 21-08-2020]


Counsel for the complainants: Varun Dev Mishra, Advocate with Mrinmoi Chatterjee Advocate

Counsel for the OPs: Shiva Shankar Banerjee, Advocate with Madhurima Ghosh, Advocate with Sankar Sarkar, in person

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Redressal Commission (NCDRC): The Bench of R.K. Agarwal (President and V.K. Jain and M. Shreesha, Members, while taking into consideration a batch of petitions and further referring to several decisions of the Supreme Court, reached to the conclusions that,

“Coaching Classes cannot fall within the definition of ‘Education Institutions’.”

“Any defect or deficiency or unfair trade practice pertaining to a service provider like ‘Coaching Centres’ does not fall within the jurisdiction of the Consumer Fora.”

Facts in the present case are in respect to deficiency of services by an educational institution that is a Dental College for admitting students when it was neither affiliated with the university nor recognized by the Dental Council of India.

Counsel appearing for the complainants stated that the facts in Buddhist Mission Dental College and Hospital v. Bhupesh Khurana, (2009) 4 SCC 473 relate to deficiency of service on account of non-affiliation and that it does not fall within any deficiency rendered during the ‘Course of Education’ being imparted ‘Post Admission’.

OP University has indulged in deficiency of service and unfair trade practice.

Contentions

OPs Counsel placed reliance on Supreme Court’s decision in P.T. Koshy v. Ellen Charitable Trust, 2012 (3) CPC 615 (SC), and stated that students are not ‘Consumers’ and ‘Education’ is not a commodity and the Educational Institutions are not rendering ‘Service’.

Counsel appearing for the Complainant’s while referred to P. Sreenivasulu v. P.J. Alexander, wherein it was held that Educational Institutions would come within the purview of the Consumer Protection Act, 1986 and that Education is a ‘service’.

Analysis and Decision

Commission addressed the ratio laid down by the Supreme Court in a catena of Judgments with respect to ‘Education’ and ‘Educational Services’ vis-a-vis Consumer Protection Act, 1986.

Bihar School Examination Board v. Suresh Prasad Sinha, (2009) 8 SCC 483,

“…Any dispute relating to fault in holding of examination and non-declaration of result by an examinee does not fall within the purview of the Consumer Protection Act, 1986.”

Maharshi Dayanand University v. Surjeet Kaur, (2010) 11 SCC 159,

“…Supreme Court in the above-stated case examined in detail the jurisdiction of the Consumer Fora to entertain a Complaint with respect to deficiency of service by Educational Institutions.”

While noting the contention that Supreme Court clearly culls down the principles and has emphatically laid down that student is not a consumer and educational institutions are not providing any ‘Service’, Supreme Court’s decision in P.T. Koshy v. Ellen Charitable Trust, 2012 (3) CPC 615 (SC) was referred to wherein it was held that,

“…Educational Institutions are not providing any kind of service, therefore, in matter of admission, fees, etc., there cannot be a kind of service, therefore, in matter of admission, fee, etc., there cannot be a question of deficiency of service. Such matters cannot be entertained by the Consumer Forum under the Consumer Protection Act, 1986.”

Counsel for the Complainants contended that the ratio of the order has to be interpreted in the sense that it was applicable only to cases which involve ‘Core Education’ services and not all activities which relate to Educational Institutions and that both  Bihar School Examination Board v. Suresh Prasad Sinha, (2009) 8 SCC 483 and Maharshi Dayanand University v. Surjeet Kaur (2010) 11 SCC 159, refer to conference of a degree and conduction of an examination, which do not sum up the entire gamut of “Education”.

Unni Krishnan, J.P. v. State of A.P., (1993) 1 SCC 645,

“…Education has never been a commerce in this country and that establishing an Educational Institution can neither be a trade or business nor can it be a profession within the meaning of Article 19 (1)(g), it was held that “Education” in its truest aspect is more a mean and a vocation rather than a profession or trade or business.”

Commission relying on the in Amar Singh Yadav v. Shanta Devi, AIR 1987 Patna 191, wherein it was held that,

“…while deciding the Law of Precedence has observed that when there is a direct conflict between two decisions of the Supreme Court of co-equal Bench, the subordinate Court must follow the judgments which states the law more elaborately and accurately and that the question whether the decision is earlier or later is not material. In the instant case in Maharishi Dayanand University Case (Supra) the Hon’ble Supreme Court had discussed the law elaborately.”

Thus, the Commission stated that ratio laid down in the last judgment that is Amar Singh Yadav v. Shanta Devi, AIR 1987 Patna 191 has to be followed. It is significant to note here that the ratio in Maharshi Dayanand University v. Surjeet Kaur (2010) 11 SCC 159, P.T. Koshy v. Ellen Charitable Trust, 2012 (3) CPC 615 (SC), Prof. K. K. Ramachandran (Supra) and Anupama College of Engineering (Supra) does not address to the aspect of what comprises ‘Core Education’ and whether all activities related to Education/ Educational institutions would be excluded from the purview of the Act.

In view of the above discussion, consumer complaints were dismissed. [Manu Solanki v. Vinayak Mission University, 2020 SCC OnLine NCDRC 7, decided on 20-01-2020]

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission (NCDRC): The Bench of Dr S.M. Kantikar (Presiding member) and Dinesh Singh (Member) dismissed the revision petition and asked the complainant to seek a remedy in a competent civil court as per the law.

In the present case, the dispute arose between O.P Thakur (Complainant) and Shimla Municipal Corporation (OP-1) and H.S. Kochar & MS Kochar, Landlords (OP-2). The dispute is in respect to “deficiency in service” as alleged by the complainant.

In the first instance after the filing the complaint, district forum held that, the present complaint cannot be decided summarily before the district forum.

Thereafter, State Commission remanded the complaint back to the district forum while directing that district forum will dispose of the complaint afresh. In adjudication afresh, the district forum reiterated its stand as was in the first instance and ordered the complaint to be returned for being presented before the competent civil court.

Again the State Commission vide its order directed that “complainant is relegated to civil court for adjudication of his dispute.”

Thus in view of the above, complainant filed the instant revision petition before the Commission under Section 21 (b) of the Consumer Protection Act, 1986 against the State Commission’s Order.

Contentions

Advocate, Sameer Thakur argued on behalf of the complainant revisionist and argued that the case is remanded to the district forum for adjudication on merit apropos deficiency in service against the municipal corporation alone.

Adding to his above argument, he stated that, the complaint is such as can be adjudicated on merit in summary proceedings in consumer protection fora established under the Act 1986. Further, he stated that, fundamental rights under Articles 14 and 19 (1) (g) of the Constitution of India are being violated by the municipal corporation’s deliberate/wilful negligence.

Corporation’s Negligence

The public drainage system above the complainant’s office premises has been neglected by the Corporation. The rainwater flow from Mall Road diverted and gets logged in front of the passage to complainant’s office premises and even enters inside the office room. Despite the odds, the complainant used to mitigate the loss/damage to his professional property to the maximum extent at his own expense.

The situation as stated above went unmanageable after the monsoons of 2011 and 2012. The complainant approached the Corporation Commissioner but was ignored and no action was taken for any of his complaints. Thereafter he filed an RTI application to seek appropriate redressal still no action was taken.

Complainant in the above situation had to exhaust his lifetime earning for the survival of his family.

Corporation’s deliberate /wilful negligence is violative of complainant’s fundamental rights under Articles 14 and 19 (1) (g) of the Constitution.

Analysis and Decision of the Commission

Commission while noting some observations stated that,

Consumer Protection fora do not enforce fundamental rights, they do not exercise jurisdiction of High Courts or Supreme Court under Articles 226 or 32.

The present complaint filed for ‘deficiency of service’ under the Act 1986 is not meant or intended to be in the nature of public interest litigation apropos a public authority.

Commission examined whether or not the specificities of the case are such as can be adjudicated on merit in summary proceedings in quasi judicial consumer protection fora established under the Act 1986.

Commission held that, the instant case can be aptly adjudicated on merit in summary proceedings by quasi judicial consumer protection fora established under Act 1986.

Further, it also stated that the revision petition is dismissed with liberty to the complainant to seek a remedy in a competent civil court as per law.  Nothing stops the complainant from seeking remedy under Article 226 or Article 32 in High Court or Supreme Court to enforce any of his fundamental rights including “Art 14 & 19(1)(g) of the Constitution” mentioned in his complaint.

In view of the above terms, the present revision petition stands dismissed. [O.P. Thakur v. Shimla Municipal Corpn., 2019 SCC OnLine NCDRC 326, decided on 15-10-2019]

Case BriefsTribunals/Commissions/Regulatory Bodies

National Consumer Disputes Redressal Commission: Justice V.K. Jain (Presiding Member), allowed a consumer complaint seeking a refund of money paid to book a residential flat in a construction project being carried out by the developer. 

Complainant herein had booked a residential flat in a project started by the opposite party (OP) by paying a booking amount of approximately Rs 1 crore. As per the allotment letter dated 20-02-2015, possession of flat was to be delivered to the complainant by March 2015; though an additional grace period of six months was available to the OP which could be invoked in case the possession was delayed due to unforeseen circumstances. However, the complainant was not given the possession even after almost 3.5 years.

The OP resisted this complaint on the ground that the delivery of possession got delayed as land on which project was to be developed was acquired by Yamuna Expressway Industrial Development Authority (YEIDA), and the said acquisition was challenged by landowners in Allahabad High Court. Further, the National Green Tribunal had prohibited the use of groundwater for construction purpose. Also, the supply of raw material and labour was disrupted due to strikes/agitation by the farmers whose land was acquired.

The Commission noted that the aforestated contentions had already been considered and rejected by it in its order dated 16-04-2019 in STUC Awasiya Grahak Kalyaan Association v. Supertech Ltd. (CC No. 2335 of 2017). In that case, this Commission had clearly held that it was for the OP to arrange water for construction purposes from alternative sources. Further, the land acquisition challenge had been decided by Allahabad High Court in October, 2011 itself and while the Supreme Court did uphold the said High Court’s judgment in appeal, no order was passed restraining builders (particularly the builders in YEIDA) from raising construction on the land. Moreover, the agreements with the complainant had been executed much later than the Allahabad High Court’s decision. Lastly, no direct evidence had been led by the OP to prove the dates on which farmers had actually prevented the construction work.

It was noted that the completed drawings were submitted by the OP on 15-02-2015 itself, which meant that the construction had been completed by that date but the requisite Completion Certificate/Occupancy Certificate had still not been issued.

Reliance was placed on the judgment in Pioneer Urban Land & Infrastructure Ltd. v. Govindan Raghavan, 2019 SCC OnLine SC 458 where it was held that complainants cannot be made to suffer and wait indefinitely for possession of the flat allotted to him, and is entitled to seek refund of the amount paid by him, along with compensation.

In view of the above, the complaint was allowed and OP was directed to refund the entire amount received from complainant, and also compensate them in the form of simple interest of 10 percent per annum from the date of each payment to the date of refund. OP was also directed to pay litigation costs of Rs 25,000 to the complainant.[Ajai Kumar v. Supertech Ltd., 2019 SCC OnLine NCDRC 63, Order dated 22-04-2019]