Case BriefsSupreme Court (Constitution Benches)

Supreme Court: The 5-judge bench of Arun Mishra, Indira Banerjee, Vineet Saran, MR Shah and S. Ravindra Bhat, JJ has held that the District Forum has no power to extend the time for filing the response to the complaint beyond the period of 15 days in addition to 30 days as is envisaged under Section 13 of the Consumer Protection Act, 1986.

The bench was answering the reference relating to the grant of time for filing response to a complaint under the provisions of the Consumer Protection Act, 1986 wherein the answers to the following questions were sought:

  • whether Section 13(2) (a) of the Consumer Protection Act, which provides for the respondent/opposite party filing its response to the complaint within 30 days or such extended period, not exceeding 15 days, should be read as mandatory or directory; i.e., whether the District Forum has power to extend the time for filing the response beyond the period of 15 days, in addition to 30 days.
  • what would be the commencing point of limitation of 30 days stipulated under the aforesaid Section.

Answering the first question,  the Court held that the decision rendered by a 3-judge bench in Dr. J. J. Merchant v. Shrinath Chaturvedi, (2002) 6 SCC 635, to be correct in law, wherein it was held that the time limit prescribed for filing the response to the complaint under the Consumer Protection Act, as provided under Section 13(2)(a), is to be strictly adhered to, i.e. the same is mandatory, and not directory.

Considering the Statement of Objects and Reasons of the Consumer Protection (Amendment) Bill, 2002 i.e. quick disposal of cases, the Court in the said verdict noticed that sub­Section (3A) of Section 13 was inserted, providing that the complaint should be heard as expeditiously as possible and that endeavour should be made to normally decide the complaint within 3 months, and within 5 months where analysis or testing of commodities was required. It was further noticed,

“The Provisos to the said sub-Section required that no adjournment should be ordinarily granted and if granted, it should be for sufficient cause to be recorded in writing and on imposition of cost, and if the complaint could not be decided within the specified period, reasons for the same were to be recorded at the time of disposing of the complaint.”

Answering the second question, the bench explained that a conjoint reading of Clauses (a) and (b) of sub-Section (2) of Section 13 would make the position absolutely clear that the commencing point of limitation of 30 days, under the aforesaid provisions, would be from the date of receipt of notice accompanied by a copy of the complaint, and not merely receipt of the notice, as the response has to be given, within the stipulated time, to the averments made in the complaint and unless a copy of the complaint is served on the opposite party, he would not be in a position to furnish its reply. Thus, mere service of notice, without service of the copy of the complaint, would not suffice and cannot be the commencing point of 30 days under the aforesaid Section of the Act.

The Court, further, clarified that,

“the objection of not having received a copy of the complaint along with the notice should be raised on the first date itself and not thereafter, otherwise if permitted to be raised at any point later would defeat the very purpose of the Act, which is to provide simple and speedy redressal of consumer disputes.”

It, hence, held that commencing point of limitation of 30 days under Section 13 of the Consumer Protection Act would be from the date of receipt of the notice accompanied with the complaint by the opposite party, and not mere receipt of the notice of the complaint.

[New India Assurance v. Hilli Multipurpose Cold Storage Pvt. Ltd., 2020 SCC OnLine SC 287, decided on 04.03.2020]

Case BriefsHigh Courts

Rajasthan High Court: A Division Bench of Sangeet Lodha and Mahendar Kumar Goyal, JJ. dismissed an appeal regarding irregularity of a suit for declaration of land under Sections 88 and 188 of the Rajasthan Tenancy Act, 1955 belonging to a Scheduled Caste member while also finding no illegality in the earlier Single Bench Judgment of the same Court.

In this case, the appellant had filed a suit for declaration and was also seeking correction of the entry in the revenue record in the Court of Sub-Divisional Officer, Sikar. The appellant stated that there was an erroneous entry in the Jamabandi as neither the defendant 2 was in possession nor he was sold any land. The suit was eventually decreed by the Court of Sub-Divisional Officer. The appeal against it was subsequently rejected first by the Revenue Appellate Authority and then by the Board of Revenue. But later on, the District Collector allowed the application of the defendants setting aside the previous judgment. This was appealed against in the High Court in which a Single Bench upheld the Judgment, but then an intra-court appeal was preferred.

The counsel for the appellant R.K. Agarwal contended that the reference made under Section 82 or under Section 232 of the Rajasthan Tenancy Act, 1955 was not maintainable in absence of any public element involved. He also asserted that there was an inordinate delay of about 19 years in making the reference which was fatal. He also stated that since there was no transfer of the land in question, as stipulated under the Transfer of Property Act, 1882, by a member of Scheduled Castes/Scheduled Tribes in favour of a non-member, the judgment of Court of Sub-Divisional Officer could not have been set aside.

The counsel for the defendant R.P. Singh contended that the pleadings of the appellant have been self-contradictory, first that the land exists in two different places and again that there was no sale between the two. The counsel further contended that it is apparent that the judgment of the Sub-Divisional Officer was obtained by the appellant playing fraud and collusion, which was accepted by the Revenue Authorities as well as by the learned Single Judge of this Court and thus it cannot be sustained. Lastly, the learned Senior Counsel contended that the Court cannot restore the order of the Court of Sub-Divisional Officer which, per-se, was illegal and the Court would not like to restore an illegal order. He, therefore, prayed that the special appeal to be dismissed.

The Court observed that the appellant had consistently taken inconsistent pleas such as the stand that he was in the possession of the land; and that the land was not in two parts. Therefore, the Court opined that the appellant has come with a dishonest plea with regard to his possession over the disputed land and so his contention with regard to possession over half of the land, had no merit.

The Court also accepted the findings of the Revenue Authorities as well as by the learned Single Judge that the previous judgment of Sub-Divisional Officer obtained was a fraudulent one. The Court also remarked that there is no limitation prescribed under Section 82 of the Act to make reference although it has to be exercised within a reasonable time. Also, the Court found no illegality in an order dated passed by the Board of Revenue in 2001. The Court further relied on Pandey Oraon v. Ram Chander Sahu, 1992 Supp (2) SCC 77 and analysed the word ‘transfer’.

At last, the Court said that the judgment that was obtained by playing fraud, cannot be saved by applying the principle of the merger. They opined that the law will take its own course and no direction in this regard was warranted from the Court. For these reasons, the appeal was dismissed. [Vidhyadhar Sunda v. State of Rajasthan, 2020 SCC OnLine Raj 76, decided on 16-01-2020]

Case BriefsForeign Courts

Supreme Court of Canada: The Coram of Wagner C.J. and Abella, Moldaver, Karakatsanis, Gascon, Côté, Brown, Rowe and Martin JJ. while allowing the appeal in part did not decide whether appellants did anything wrong.

In this instant case, the respondent, Godfrey had alleged that the appellants who manufacture Optical Disc Drives (ODDs) and ODD products, conspired to fix prices of ODDs and ODD products between 2004 and 2010 (“class period”). Godfrey had applied for certification of a class proceeding (class action suit) against 42 appellants (collectively, “Toshiba”) under the British Columbia Class Proceedings Act. A “class action” lawsuit is one in which a group of people with the same or similar injuries caused by the same product or action sue the defendant as a group. A judge has to agree for a class action to proceed. A “representative plaintiff” stands in for the group. Mr. Godfrey was the representative plaintiff in this case.

The proposed class (group of people who Godfrey represented) consisted of direct purchasers, indirect purchasers, and umbrella purchasers, that is, purchasers whose ODD or ODD product was manufactured and supplied by a non-defendant (herein appellant), which means the consumers who bought from other suppliers could also join in the ‘class’.

Although the action against most of the appellants was filed within two years of the end of the class period, the action against a subset of the appellants was filed more than two years after the end of the class period.

The certification judge certified the action as a class proceeding, subject to certain exceptions and conditions. One condition was that the definition of “class” is amended so as to satisfy Section 4(1)(b) of the Class Proceedings Act. The certification judge held that the definition of “class” (“persons resident in British Columbia who purchased ODDs and ODD products in the class period”) was insufficiently precise, as it was unclear which products were included.

The Defendants (here appellants) challenged the Court of Appeal’s order before this Court (in the “Toshiba Appeal”) and contended that both the Certification Judge and the Court of Appeal erred in three respects: (a) by permitting the Umbrella Purchasers to claim under the statutory cause of action in Section 36(1) of the Competition Act; (b) by allowing common law and equitable relief based on a breach of the anti-competitive prohibitions in Part VI of the Competition Act; and (c) by finding that loss-related issues were common among the indirect purchasers based on the expert methodology proposed by the Plaintiff.

The appeal brought by the Pioneer, defendants (herein appellants) (in the “Pioneer Appeal”) raises two more as well as unique issues pertaining to the treatment of the limitation defence by the courts below. The Pioneer, defendants (here appellants) argued that the Certification Judge erred in holding that the action against them can proceed — notwithstanding that it was commenced more than two years following the end of the Class Period — based on the application of the discoverability rule and the doctrine of fraudulent concealment.

In this Court, the Pioneer, defendants (here appellants) submitted (a) that the discoverability rule does not apply to postpone the commencement of the limitation period in Section 36(4)(a)(i) of the Competition Act, and (b) that the doctrine of fraudulent concealment cannot toll that limitation period unless the Plaintiff can establish that he and the other class members stand in a “special relationship” with the Pioneer, defendants.

The majority of this Court held that: The plaintiff’s (here respondent) claim against the Pioneer defendants will not fail on the basis that it was commenced after the two-year limitation period under Section 36 (4)(a)(i) of the Competition Act because the discoverability rule applies which extends the limitation period. The reason for which umbrella purchasers can be included in that, the pleadings against all the defendants disclose a cause of action for them under s. 36(1)(a) of the Competition Act, thereby satisfying the conditions under Section 4(1)(a) of the Class Proceedings Act for certification. Also, as Section 36(1) of the Competition Act does not bar common law or equitable claims, it is not plain and obvious that the plaintiff’s other claims cannot succeed. Secondly, under the theory of umbrella pricing, the entire market for the subject product is affected because anti-competitive cartel activity causes non-cartel manufacturers to also raise their prices. Similar circumstances existed here too. As Pioneer’s and Toshiba’s prices were higher, other companies also charged higher prices. People paid more than they should have. As a result, Pioneer and Toshiba made more money.

Furthermore, it was also observed that the doctrine of fraudulent concealment could delay the running of the limitation period, which the appellant here did.

As per Côté J. (dissenting in part): Both appeals were allowed in part. The Pioneer defendants had not demonstrated that the plaintiff’s claim for recovery under Section 36(1) of the Competition Act is time-barred by the limitation period in Section 36(4)(a)(i). While the discoverability rule does not apply to toll the limitation period, it is not plain and obvious that the fraudulent concealment doctrine has no application in this case. Pioneer and Toshiba hid what they were doing so Godfrey and the other consumers couldn’t find out. It wouldn’t make sense if people lost the right to sue before they had any way of even finding out they were harmed.

The discoverability rule does not apply to toll the limitation period in Section 36(4)(a)(i) of the Competition Act that is applicable to the plaintiff’s claim for recovery under Section 36(1) of that statute.[Pioneer Corpn. v. Neil Godfrey, 2019 SCC OnLine Can SC 16, decided on 20-09-2019]

Case BriefsHigh Courts

Bombay High Court: S.S Shinde, J. dismissed a criminal application filed against the order of a Judicial Magistrate thereby issuing process against the applicant for an offence punishable under Section 138 (dishonour of cheque) of the Negotiable Instruments Act, 1881.

The complainant-respondent had alleged that he advanced a loan of Rs 30 lakhs to the applicant, for the repayment of which, the applicant had issued a cheque in his name. However, on presenting the cheque for encashment, it was returned unpaid due to insufficiency of funds. Pursuant thereto, after complying with codal formalities, the complainant filed a complaint against the applicant for the commission of an offence under Section 138 of NI Act. Consequently, the Magistrate issued a process. Aggrieved thereby, the applicant filed the present application under Section 438 CrPC.

The applicant, represented by S.V. Marwadi, Advocate, inter alia, contended that the complaint was filed after the statutory period of limitation has ended. Per contra, S.V. Marwadi, Advocate representing the complainant contended otherwise and supported the impugned order.

The High Court was of the view that to find out whether the complaint filed by the complainant was within the period of limitation or otherwise, appreciation of documents was necessary. Prima Facie, it appeared that the complaint was within limitation, and therefore it could not be concluded at the threshold that the complaint was not maintainable. Similarly, it was held that the other contentions made on behalf of the applicant also required to be appreciated at the trial. In such view of the matter, the Court held that the present application was liable to be dismissed. Orders were made accordingly. [Amit Digvijay Singh v. Gokuldas Jagannath Bhutada, 2019 SCC OnLine Bom 1350, decided on 19-07-2019]

Case BriefsHigh Courts

Allahabad High Court: This petition was filed before a Single Judge Bench of Saumitra Dayal Singh, J., dealing with the issue of limitation period under Section 107 of UP Goods and Services Tax Act, 2017.

Facts of the case were such that petitioner’s goods were subjected to seizure proceedings under Section 107 of the Act, 2017. Petitioner contended that penalty order as a consequence of seizure was not served on him by the Assessing Authority and the same was delayed. As soon as he received the order he filed appeal under Section 107 of the Act. This appeal was dismissed being time barred. According to Section 107(1) limitation period was three months from the date of communication of the order which can be condoned for not more than one month.

The issue before the Court was that whether the petitioner would have a right of appeal beyond 30 days from the date of the penalty order or 30 days from the date of service of that order on the driver of the truck who was found to be transporting the goods belonging to the petitioner-assessee.

High Court was of the view that considering the filing of an appeal to be condoned for not more that one month the phrase “communicated to such person” appearing in Section 107(1) of the Act shows that the order be necessarily brought to the knowledge of the person who is likely to be aggrieved. Therefore, limitation period would start from the day the petitioner got to know of the penalty order for filing appeal. [S/S Patel Hardware v. Commr. (State GST), 2018 SCC OnLine ALL 3059, order dated 10-12-2018]

Case BriefsHigh Courts

Allahabad High Court: A Full bench comprising of CJ Dilip B. Bhosale, Ramesh Sinha and Yashwant Varma, JJ. struck down the proviso to Section 14A (3) of the Scheduled Castes/ Schedules Tribes (Prevention of Atrocities) Amendment Act, 2015, which imposed a 180-day bar for preferring appeals against judgments, sentences, bail orders and other orders passed by Special Courts under the SC/ST Act and gave a comprehensive interpretation to questions arising from Section 14A of the Act.

The Court took suo motu cognizance of the validity of Section 14A of the Act, in view of divergent opinions of two Single Benches of the court. The present PIL was tagged along with another PIL, numbered as Criminal Writ-PIL No. 11 of 2018, challenging the validity of Sections 14A (2) and 14A (3) of the Act for being violative of Articles 14 and 21 of the Constitution of India. The provisions relevant to the present matter were:

  • Section 14A(1) stating that appeals from judgments, sentences or orders, except interlocutory orders, of a Special/Exclusive Court, trying SC/ST cases would lie to the High Court on both facts and law.
  • Section 14A(2) stating that appeals from bail orders of the Special/ Exclusive Court would lie to the High Court, even if it is an interlocutory order.
  • Section 14A(3) stating that an appeal under this Section should be preferred within a period of 90 days (extendable on court’s discretion). However, the second proviso to this clause laid down that the limitation period to not be extendable beyond 180 days.
  • Section 14A(4) providing for disposal of every appeal preferred under sub-section (1) within three months from the date of admission of appeal.

The aforesaid provisions had an overriding effect over provisions of the Code of Criminal Procedure (CrPC).

The court noted that Section 14A primarily created an appellate forum at the level of the High Court to challenge any judgment, sentence or order, not being an interlocutory order, including an order refusing or granting bail. It was noted that though an appeal is not maintainable against interlocutory orders since an interlocutory order refusing or granting bail pertains to the liberty of the accused, an exception had been carved against the said general exclusion.

The challenge to Section 14A(2) was on the sole ground that Section 14A (2) ousted the concurrent jurisdiction of High Court under Section 439 CrPC in matters pertaining to grant of bail. The said challenge was dismissed holding that SC/ST Act is a special statute and as per the general principles of statutory construction, its non-obstante clauses had to be given overriding effect over a general enactment such as CrPC.

The Bench struck down the second proviso to Section 14A (3) holding it to be manifestly arbitrary in as much as it took away the salutary right of the first appeal, an integral facet of fair procedure under Article 21. It was held that absence of discretion in the court to consider condonation of delay even on the existence of sufficient cause rendered the said proviso wholly capricious, irrational and excessive.

The Bench further noted that the inherent and constitutional powers of High Court under Articles 226 and 227 of the Constitution were not ousted by Section 14A of the Act. However, a note of caution was given by the Bench stating that courts must exercise the principle of judicial restraint and allow such powers to be invoked only in exceptional and rare cases to secure justice.

The Court also noted thatthe scheme of the Act showed the manifest legislative intent to oust revisional powers of High Court under Section 397 CrPC and therefore Section 14A eclipsed the revisional jurisdiction of High Court.

Another question posed before the court was that since Section 14A of the Act, introduced by the amendment in 2015, came into effect from 26-1-2016, whether offences committed before the said date would also be subject to Section 14A. It was clarified that applicability of Section 14A would depend on the date of the judgment or order sought to be assailed. If the judgment sought to be appealed against was passed after the 26-01-2016, then only would Section 14A be triggered. It was further clarified that even if the impugned judgment was passed before 26-01-2016 but if the appeal against it is preferred after the said date, Section 14A would apply.

The 2015 amendment to SC/ST Act empowered Exclusive Special Courts established under the amended provisions to directly take cognizance of offences under the Act. The last question for determination before the Bench was as to whether the power to directly take cognizance of offences shall be exercisable by the existing Special Courts (constituted under the 1989 Act). On this point, the court held that the existing Special Courts did not have jurisdiction to directly take cognizance of offences; such existing courts could take cognizance of offences under the Act only after the concerned Magistrate commits the case as per Section 193 of CrPC. However, it was clarified that the same not be construed to be a disrobing of these courts’ powers to try offences under the Act.

The PIL was disposed of answering the issues framed for the consideration of the Full Bench, as detailed above, along with a parting observation that although the Amending Act came into force with effect from 26-01-2016, neither any Exclusive Special Courts had been established nor had any Special Courts been designated till the date of order. The Bench directed the State government to initiate the consultative process, as envisaged under Section 14 of the Act, to ensure that Exclusive Special Courts and Special Courts are constituted and designated within a period of eight weeks from the date of order. [Provision of Section 14A of SC/ ST (Prevention of Atrocities) Amendment Act, 2015, In Re; Criminal Writ – PIL No. 8 of 2018, decided on 10-10-2018]