LANDMARK JUDGEMENTS

UNDER
CONSUMER PROTECTION ACT
Definition of Consumer (Section 2(7)
 Morgan Stanley Mutual Fund v. Kartick Das (1994) 4 SCC 225.
The Hon’ble Supreme Court laid down the rationale behind the broad definition of a
consumer: “The definition of the consumer is broadly stated so as to include anyone who
consumes goods or services at the end of the chain on production. The consumer as the
term implies is one who consumes. As per the definition, consumer is the one who
purchases goods for private use or consumption. The comprehensive definition aims at
covering every man who pays money as the price or cost of goods and services. The
consumer deserves to get what he pays for in real quantity and true quality. In every
society, consumer remains the centre of gravity of all business and industrial activity. He
needs protection from the manufacture, producer, supplier, wholesaler and retailer.”

 Spring Meadows Hospital v. Harjol Ahluwalia AIR 1998 SC 1801.

 Beneficiary of the services is a Consumer
 The Hon’ble Supreme Court held that, a beneficiary of the service is also a
consumer, irrespective of whether he himself has paid the consideration for the
service. Therefore, a child admitted and treated in a hospital will fall under the
definition of consumer.
Statutory Authority
 Lucknow Development Authority v. M. K. Gupta, AIR 1994 SCW 97:
1993 (3) CPJ 7 SC.
 # Whether Statutory Land Development authorities come under the ambit of
Consumer Protection Act 1986.
 # Whether housing activity came within the purview of services defined in the
act prior to its amendment in 1993.
 SC held that, the provisions of the act have to be construed in favour of the
consumer to achieve the purpose of enactment as it is a social benefit
oriented legislation.
 The primary duty of the court while constructing the provisions of such an Act
is to adopt a constructive approach subject to that it should not do violence to
the language of the provisions and is not contrary to attempted objective of
the enactment.
COMMERCIAL PURPOSE

 Laxmi Engineering Works v. PSG Industrial Institute (1995) 3

SCC 583 [1995] AIR SC 0 2114.
 The term “commercial purpose” means buying and selling
merchandise on a large scale with the aim of profit- making. Whether it
is for “commercial purpose” or not depends upon the dominant
purpose for the purchase and thus, depends upon the facts of each
case
Morgan Stanley Mutual Fund v.
Kartick Das, (1994) 4 SCC 225
 The consumer is a comprehensive definition aims at covering every man who
pays money as the price or cost of goods and services.
 The consumer deserves to get what he pays for in real quantity of all business
and industrial activity.
 He needs protection from the manufacture, producer, supplier, wholesaler and
retailer
 The consumer forum were established in order to address disputes relating to
consumer issues in an effective and speedy manner.
 However, a wide interpretation of the word ‘consumer’ would lead to the
floodgate theory of litigation.
 Hence, a narrow interpretation would avoid unnecessary burden on the
consumer forum, which would vitiate the very purpose for which they were
established: timely justice.
 However, at the same it is essential that the phrase ‘commercial purpose’ is not
interpreted in too narrow a manner so as to let manufacturers evade the law.
 A balance must be struck between the two approaches in order to ensure that
those who require justice gain expedient access to it.
 The consumer forums have interpreted the phrase “commercial purpose” in
numerous case laws over the years.
 The vagueness of the definition in the legislation has been matched by the
confusing decisions delivered by the consumer forum.
The following tests can be used to determine if the
goods have been purchased for a commercial
purpose:
 The goods are not for immediate final consumption but is only meant to
be transferred, i.e. resale.
 There is a direct relationship between the purchase of the goods and
the profit or loss from their further sales,
 i.e. the person is engaged in large-scale manufacture or trading business for profit-
making purpose, and not as a venture for self-employment in order to earn a living for
himself.
 It is an important aspect of interpreting the meaning of ‘consumer’ under
the Act to first understand the “purpose” of the deal from both parties
points of view.
 One of the parties should be contracting as part of their business
(necessarily the seller) and the other purely for personal consumption
purposes or self-employment.
 Whether the deal is being undertaken by the buyer for personal
consumption or self-employment; or other commercial or business
interests (in which case, protection will be denied) is determined by the
courts keeping in view the use to which such goods purchased is put to.
Kores (India) Ltd v. Samir Purkayastha
MANU/ CF/ 0109/ 1996; II (1996) CPJ
71 (NC).
 Factor to determine Commercial Purpose
 It has to be interpreted on a wide connotation with determination of
purpose in a consumer case and it should be done by taking into
account a number of factors, namely,
 • the scale of business,
 • the investment involved,
 • the motive and intention behind the business,
 o whether in the nature of earning a livelihood or
 o earning substantial profits.
A Lakshmanan v. Anjaleen Enterprises, (1993) 2 CPR
355 TN :
- the purchase of an STD/PCO machine was held to a
consumer activity as it was in furtherance of his
livelihood.
Vinod Jain v. Ravi Frost Refrigerator,(1993) 2 CPR
537 Har:
- where the purchase of a refrigerator for his small shop
was considered part of his self-employment and he was
still allowed redressal under the ambit of being a
consumer.
From the above cases;
 As long as the purchase furthers one’s own livelihood by means of
self-employment, the courts shall consider the buyer a ‘consumer’ and
the transaction as ‘consumer’ activity.
 The difference arises when the intention of the buying party is to
further its business or trade practice; in which cases the purpose
would be held to be ‘commercial’.
 Thus, one can say that “commercial purpose” includes all those
activities directly related to business and commerce, and those that
transactions where the goods involved are
(1) going to be used for resale
(2) being purchased for being used in any activity directly to generate profit.
Livelihood
 "Laxmi Engineering Works v. P. S. G. Industrial Institute“ AIR 1995 SC 1428
 The appellant, Laxmi Engineering Works, is a proprietary concern
established under the Employment Promotion Programme.
 It is registered as a small scale industry with the Directorate of Industries,
Maharashtra and has also obtained financial assistance from Maharashtra
State Finance Corporation in the form of term loan amounting to Rs.22.10
lakhs besides financial assistance from certain other sources.
 The appellant placed an order with the respondent - P. S. G. Industrial
Institute for supply of PSG 450 CNC Universal Turning Central Machine on
May 28, 1990.
 The appellant's case is that the respondent not only supplied the machinery
six months beyond the stipulated date but supplied a defective machine.
Soon after it was installed and operated, several defects came to light which
the appellant brought to the notice of the respondent.
 A good amount of correspondence took place between the parties and
though the respondent sent some persons to rectify the defects, the machine
could not be put in proper order.
 The appellant states that he was suffering financial loss on account of the
defective functioning of the machine and accordingly he lodged a complaint
(No. 116 of 1992) before the Maharashtra Consumer Commission claiming
an amount of Rs. 4,00,000/- on several counts from the respondent.
Cont…
 The respondent appeared before the State Commission and denied the
appellant's claim.
 Inter alia, it raised an objection that since the appellant has purchased
the machine for commercial purposes he is not a consumer within the
meaning of the said expression as defined in Section 2(1)(d) of the Act.
The commission allowed the appellant's claim partly, directing the
respondent to pay to the appellant a sum of Rs. 2.48 lakhs within 30 days
failing which the said amount was to carry interest at the rate of 18% per
annum.
The respondent filed an appeal before the National Commission which
allowed the said appeal on 7th December, 1993 on the only ground that
the appellant is not a "consumer" as defined by the Act.
The National Commission observed: From the facts appearing on record it is
manifest that the complainant is carrying on the business of manufacture of
machine parts on a large scale for the purpose of earning profit and significantly
one single item of machinery in respect of which the complaint petn. It was filed by
him before the State Commission itself is of the value of Rs. 21 lakhs and odd
Cont..
 In the circumstances, we fail to see how the conclusion can be
escaped that the machinery in question which is alleged to be
defective was purchased for a commercial purpose.
 Hence, the complainant is not entitled to be regarded as a
consumer and the complaint petition filed by him was not
maintainable before the State Commission. The order passed by
the State Commission is set aside.
 The complaint petition is dismissed." The National Commission,
however, observed that their order does not preclude the
appellant from pursuing his remedy by way of ordinary civil suit.

 the Hon’ble Supreme Court held that the court has to look at
the dominant purpose for which the purchase is made in
order to decide whether it was for a “commercial purpose.”
Cont..
 Sakthi Engineering works v. Sri Krishna Coir Rope Industry Rep. by its
proprietor P. Krishnaiah, 2000(3)CPJ 13; 8-8-2000
 The important words used in this explanation are “used by him exclusivel
y”, i.e. for the purpose of earning his livelihood and ‘by means of self-
employment’.
 If a person is not exclusively using the goods for the purpose of earning
his livelihood he will not be able to get benefit of this explanation.
 Further difficulty is that the livelihood has to be earned by employing the
consumers own efforts and not by employment of any other persons.
‘Self-employment’ negates employment of any other person.
 The rigour of this section was softened by the SC in the case of (AIR 1995
SC 1428) Laxmi Engineering Works v. P. S. G. Industrial Institute by holding
that if a person has employed himself in running a machine with the help
of one or two other persons it will be still a case of ‘self-employment’.
 But the important thing is that the person concerned must engage himself
in the activity which generates his livelihood. It will not do if he merely acts
in a supervisory position.
Cont..
 A person who buys a typewriter or a car and uses them for
his personal use is certainly a consumer
 The explanation however clarifies that in certain situations,
purchase of goods for ‘commercial purpose’ would not yet
take the purchaser out of the definition of expression
‘consumer’.
 If the commercial use is by the purchaser himself, he does
not cease to be a consumer.
 In other words, if the buyer of goods uses them himself, i.e.,
by self-employment for earning his livelihood, it would not
be treated as a commercial purpose and he does not cease
to be a consumer for the purpose of the act.
Cont…
 Vijay Prakash Goyal (Dr) v. Network Ltd; 2005 (4)
CPJ 0206 NC, DD-11-8-2005
 COPRA- sec.2(1)( c) , 2(1)(g)- complaint-Maintainability-
Deficiency in service- Warranty- Altrasound scanner-
Commercial Purpose- Plant and Machinery purchased-
Defect within warranty- Liability of seller- If defects
develops within remove defects- compensation for mental
agony also given with interest.
 Purchaser of a machine would be a consumer if the defect
in machine develops within warranty period even though
the machine was purchased for commercial purpose.
 Therefore, NC held that the contention of petitioner not
being a consumer is without any merit.
Karnataka Power Transmission
Corpn. Ltd. v. Ashok Iron Works
Pvt. Ltd. AIR 2009 SC1905
 Consumer Protection Act (68 of 1986), S.2(1)(g), S.2(1)(d)(ii) (as it
stood before 2002), S.11 - CONSUMER PROTECTION - Deficiency in
service - Non-supply of electricity to consumer, a manufacturing unit,
by Transmission Company within time fixed - Amounts to deficiency
in service - Complaint against, is maintainable before consumer
forum.
Non-supply of electricity to consumer by Transmission Company
within time agreed upon even if the consumer is a manufacturing unit,
amounts to deficiency in service as per the definition of consumer as
it stood before 2002 amendment.
Complaint against Transmission company is maintainable before
Consumer Forum. (Paras 22, 25)
Goods Purchased for Resale:
Sideshwar iron & Steel (p) Ltd. V. Kirloskatr Electric Co.
Ltd., 2002(3)CPR 197 (NC)
Complainant, a business enterprise alleged that inspite of
making the necessary payments, goods had not been
supplied by the opposite party.
National Commission held that complaints relating to non
supply of goods is purely for resale and supply will not be
in the nature of deficiency of services and the sale being
purely for commercial purpose, the complainant would not
be a consumer and the dispute would not come within the
jurisdiction of the Consumer Courts
Contd…
Wimco Limited v. Ashok Sekhon, (2008) II CPJ 210 (NC)
Trees purchased on large scale for Commercial Purpose. They
were damaged due to heavy rainfall. Insurance cover was not
obtained by the opposite party. Damages were claimed before State
Commission. The State Commission allowed the Complaint.
In appeal it was held that growing trees in 9 acres of irrigated land
would not amount to indulging in self employment. Goods Purchased
not for self consumption but for resale was proved.
The National Commission held that since commercial purpose was
involved, Complainant was not a consumer
Free Services :
 Rabi Narayan Sahoo v. Dr. B Jayaram Pathra, 2004 (1) CPJ 3(NC)
Petitioner’s mother was treated by Dr. Jayaram. After the Operation
patient Died. The Complainant’s case was that the operation was
done in a negligent manner and there was lack of proper care in
treating the patient by the Physician. District forum and State
Commission held doctor negligent and awarded compensation for
deficiency in service
National Commission held that since no consideration was paid by the
complainant to the hospital or the doctor, the complaint was not
maintainable since free services do not fall under the purview of the
Act and the petition was dismissed.
Services in Government Hospital.
 MABLE Roosevelt v. State of Kerala, 1991 (1) CPR 330 NC
A complaint was filed before the National Commission by the
Complainant on behalf of her husband who suffered a cardia arrest
while under anesthesia for undergoing surgery in Medical College
Hospital. He is been admitted in the hospital for treatment free of
charge.
The National Commission held that the claim for compensation against
the State Government is not maintainable as the deceased was not a
consumer as he had not availed of any services for consideration.
Contd….
 Indian Medical Association v. Dr.V. P.Shantha, AIR 1996 SC 550
The supreme court in this case laid down that even in Government hospital
if certain services are availed for consideration by other patients, the non
paying patients should be construed as beneficiaries of the paying class
and as such come within the definition of consumer under Sec. 2(1)d of the
Act.
E-Commerce Web Portal
 Rediff.Com India Limited vs Ms. Urmil Munjal
The complainant bought certain goods from rediff.com which returned out to be
defective. It was contended by redff.com that it was a mere facilitator
between the buyer and the vendor and the Complainant was not its
consumer as per the Act. It was alleged that dissatisfaction of the
Complainant, if any, was with goods delivered by their vendor, who had not
be joined as a necessary party before the Consumer For a. It was claimed
that the revision petition was mere facilitator of the transaction between the
seller and the buyer and could not be liable for any deficiency of service. It
was held that rediff.com acts as a medium of communication between the
buyer and seller and since this was the business interest, it could not be said
that it provided gratuitous service to its customers. Therefore the complainant
was a consumer as per the Act.
Cont..
 The Commission Observed that,

We find that the view taken by the fora below is completely in line with the admitted position
of the RP/OP. In para 2 of its written response before the District Forum, it is clearly stated
that the respondent company is engaged in business of providing services through its
internet portal (www.rediff.com) to interested buyers and sellers by acting as a means of
communication between them and bringing into existence contracts of sale and purchase of
movable goods. If this is the declared business interest of the RP/OP it cannot be permitted
to claim that it is providing purely gratuitous service to its customers, without any
consideration. It is certainly not the case of RP/OP that it is a charitable organisation
involved in e-commerce, with no business returns for itself. We therefore, reject the
contention of the revision petitioner that the respondent/Complainant is not a consumer of
the revision petitioner within the meaning of Section 2(1) (d) of the Consumer Protection Act,
1986.
Trust Is a Consumer

 Lilavati Kirtilal Mehta Medical Trust v. Unique Shanti Developers

and Ors., MANU/ SC/ 1574/ 2019
 The hospital had taken possession of twenty- nine flats for
provision of hostel facilities to the nurses who were employed by
the hospital. A dispute arose over the poor quality of the building
which led to vacation of the premises. The respondent claimed
that the hospital was engaged in a commercial purpose, and was
not a consumer. The Supreme Court held that there was no
nexus between the purchase of flats by the hospital and the
commercial purpose of rendering medical services to patients.
Accordingly, the hospital was a consumer.

 Administrator, Smt. Tara Bai Desai Charitable Opthalmic Trust

Hospital v. Managing Director, Supreme Elevators India Pvt. Ltd.,
 2019 SCC OnLine NCDRC 570.
Misleading Advertisement: Section
2(28)

 Colgate Palmolive India Ltd v. Anchor Health and Beauty Care

Private Ltd., MANU/ TN/ 0980/ 2008,
 The defendant had claimed that its product “Anchor” toothpaste was
the “only” toothpaste to contain certain ingredients and that it was the
“first” one to provide “all- round protection.” The plaintiff had objected to
such claims because the plaintiff ’s products contained all the said
ingredients. It was the plaintiff ’s claim that the defendant’s
advertisement disparaged the former’s product in an implied manner.
The Court decided in favor of the plaintiff by observing that any
consumer of average intelligence would receive a misleading message
on viewing the advertisement and that the same would be against the
concept of consumer justice. The Court opined that the advertisement
would fall within the ambit of an unfair trade practice defined in the CPA
of 1986 and is therefore impermissible.
Product Liability Section 2(34)
 C.N. Anatharam v. Fiat India Ltd. and Ors., AIR 2011 SC 523. the
Hon’ble Supreme Court held that in a complaint regarding constant noise
from the engine, an independent technical expert’s opinion must be
sought on whether the vehicle has an inherent manufacturing defect. If
the same is shown, then the consumer is entitled to refund of price of
vehicle and lifetime tax and EMI along with interest at 12% p.a. and costs.

 Jagrut Nagrik and others v. Proprietor, Baroda Automobile Sales and

Service, Vadodara, Gujarat and Others,2010 SCC OnLine NCDRC 250.
the NCDRC held that the vehicle sold to the consumer broke down
constantly due to lack of quality testing while manufacturing and inability
of the seller to repair the defects in the car. Accordingly, both were liable
to pay compensation to the consumer.
Unfair Trade Practice: Section
2(47)

 Ludhiana Improvement Trust v. Shakti Co- operative House Building

Society Ltd (2009) 12 SCC 369.
 The Hon’ble Supreme Court held that there are formulated the basic
ingredients of “unfair trade practice”— (i) there must be a trade practice;
(ii) it must be employed for the purpose of promoting the sale, use, or
supply of any goods or for provision of the service; and (iii) it adopts an
unfair method or unfair or deceptive trade practice. The mere averment
by the complainant as to the existence of an unfair trade practice is
insufficient, there must be cogent material for the same. Therefore, any
trade practice which is adopted for the purpose of promoting the sale,
use, or supply of any goods or for the provision of any service, by
adopting any unfair method or unfair or deceptive practice has to be
treated as “unfair trade practice”
Cont….

 Richard Raja Singh v. Ford Motor Co Ltd 2014 SCC OnLine NCDRC
631;IV (2014) CPJ 509 (NC).
 Dr. Richard Raja Singh, and his son, R. Backiaraj Vinuben, purchased a Ford
Mondeo car and were traveling to Thirunelveli, along with their family members.
While traveling they collided with a vehicle sideways on the left side of the Ford
Mondeo car. All the four passengers traveling in the car died on the spot. The
case of the complainants is that the air bags, which were supposed to deploy
immediately on the collision, did not deploy at all. The complainants are, thus,
alleging that a faulty product was sold to them by the Opposite Party, since
while selling the vehicle, they claimed that it had world- class safety features,
including the state- of- the- art air bag system, which protects the passengers
in the event of an accident, whereas in fact neither the front air bags nor the
side air bags got deployed, despite heavy impact. The NCDRC held that the
OP is liable for unfair trade practice.
Falsely Represents that Seller or Supplier
Has Sponsorship or Affiliation

 Buddhist Mission Dental College and Hospital v. Bhupesh Khurana and Ors.,(2009) 4 SCC 484.
 An advertisement issued by the Buddhist Mission Dental College and Hospital, in 1993, inviting
applications for admission to the Degree Course of Bachelor of Dental Surgery.
 This is what the advertisement said: “The Buddhist Mission Dental College and Hospital (under Magadh
University, Bodh Gaya, and Dental Council of India, New Delhi, Siddharth Nagar, New Bailey Road, Patna-
801305). A premier Dental College of Bihar established and managed by Vishwa Buddha Parishad under
Article 30(1) of the Constitution of India, fulfilling all the criterion and conditions of Dental Council of India.”
 Clearly, the impression created by the advertisement was that it was affiliated to Magadh University and
was recognized by the Dental Council of India. Both were however false.
 Since the college was not recognized, no examination was held at the end of the academic year, forcing
eleven students to file a class action suit before the consumer commission.
 The NCDRC, in its order delivered in the year 2000, directed the college to refund the fees paid by the
students at the time of admission along with 12% interest and also pay 20,000 rupees as compensation to
each of the students to defray their academic expenses and loss of two valuable academic years.
 Both filed appeals before the Hon’ble Supreme Court. While the institute opposed the Order of the National
Commission holding it guilty of unfair trade practice, the students wanted the amount of compensation to
be increased to 1.25 lakh rupees and also refund of 1 lakh rupees paid as capitation fee.
 The Hon’ble Supreme Court directed the institute to pay an additional compensation of 1 lakh rupees to
each of the students (complainants) and also pay cost of litigation quantified at 1 lakh rupees to each of
them. As far as refunding the capitation fee was concerned, the Hon’ble Supreme Court held that in the
absence of any receipt or proof (the students had alleged that the amount had been received in cash and
the institute had refused to give them any receipt despite repeated requests) it would be difficult to order its
refund.
Offering Free Gifts, Prizes, or Contest
and not Disclosing Full Details

 Connaught Plaza Restaurants Ltd. v. Kapil Mitra, 2020 SCC OnLine NCDRC
192
 The complainant had participated in OP’s widely published scheme “Mc Donald’s
Mein Khao Har Bar Prize Le Jao” by placing two separate orders. It was alleged that
the complainant did not find any terms and conditions on the notice board, instead
found a leaflet of another scheme “McDonald’s Ghar Bulao Sab Lucky Ban Jao!”
The details of the entire scheme with terms and conditions and the result of the
winners were also concealed from the participating customers. The National
Commission held that non- disclosing the details of the entire scheme with terms
and conditions and the result of the winners is unfair trade practice.

 Bonn Nutrients Pvt Ltd v. Jagpal Singh Dara 2005 Indlaw NCDRC 149; IV
(2005) CPJ 108 (NC). (Bread Case- Scratch and Win)

 The Consumer Disputes Redressal Commission Punjab, Chandigarh, ordered to

pay compensation of 5,000 rupees to the complainant for unfair trade practice.
 On appeal the National Commission rejecting the appeal held that compensation for
unfair trade practice must be exemplary and therefore enhanced it to 50,000 rupees.
Refusal to allow water bottles inside movie
halls amounts to unfair trade practice

 Rupasi Multiplex v. Mautusi Chaudhuri 2015 SCC OnLine NCDRC 2331.

 The NCDRC held that “If a cinema hall, while prohibiting carrying of drinking water inside the
hall, fails to make potable drinking water available to the cine- goers, it will be an act of
deficiency in rendering service to them, they having paid a substantial amount for watching the
movie in a comfortable and satisfying environment.” “If such a deficiency is shown, the
Consumer Forum would be fully justified in awarding suitable compensation to the complainant
Using Customers as Advertising Agents:
Charging Money for Carry Bags with
Printed Logo

 Big Bazaar (Future Retail Ltd) v. Ashok Kumar 2020 SCC OnLine
NCDRC 495.

 Bata (India) Ltd v. Dinesh Prasad Raturi 2019 Indlaw SCDRC

1489

 Bagelkar Akash Kumar v. More Megastore Retail Ltd Consumer

Case No. 310/ 2019.
Unfair Trade by E- Commerce
Entity
 Supriyo Ranjan Mahapatra v. Amazon Development Centre India (Pvt) Ltd First
Appeal No. 492 of 2018.

 The appellant was in his first year of law school. The OP had floated an offer for
sale of a laptop without Laptop Bag on amazon’s platform. The OP had
confirmed the order and 2 hours after receiving the confirmation, the appellant
received a phone call from the OP’s Customer Care Service Department stating
that the subject order stood cancelled due to the price recession issue. Since
the complainant was in need of a laptop to prepare his project, he raised an
objection for such cancellation. On not receiving any response from the OP,
complainant issued a legal notice.
 Appellant had to purchase another laptop but suffered from mental agony for
such cancellation, hence filed a complaint alleging the deficiency in service and
unfair trade practice.
 The Bench observed that “When there is an advertisement made for offer
placed by the OP and made the offer as per the material available on record
and complainant placed the order and same got confirmed, the agreement is
complete.” Another aspect to be noted was that, when the OP had allowed
Rockery Marketing at his platform as per written version, the responsibility of
the OP could not be lost sight of. Since there was a breach of contract and
unfair trade practice by OP, OP is held to be liable to pay the damages.
Cont…

 Air India v. O.P. Srivastava & Ors. 2018 SCC OnLine NCDRC 548 , the
NCDRC held that airlines should develop stringent conditions on the
eventuality of cancellation of flights as it can lead to the development of
an unfair trade practice for earning profit.

 Sahara Prime v. Tapasaya Palawat, 2019 SCC OnLine NCDRC 315 the
NCDRC held that unilateral cancellation of allotment of flat and forfeiture
of the deposited amount by the Developer of a flat amounts to an unfair
trade practice.

 MakeMyTrip Pvt. Ltd. v. Manabendra Saha Roy, 2019 Indlaw NCDRC

884, the NCDRC held that changing the tour package at the last minute
and threatening the consumer with cancellation of the trip and forfeiture
amounted to an unfair trade practice.
Special Act and General
Act
Decided Cases

Sec.100 of CPA 2019

Chairman, Thiruvalluvar Transport
Corporation v. Consumer Protection
Council, AIR 1995 SC 1384
Consumer Protection Act 1986 - MOTOR VEHICLES ACT,
1988- Claim for compensation arising out of motor accident -
Commission cannot adjudicate - Claim arising out of accident
cannot be said to be in relation to any service hired or
availed by consumer - Moreover provisions of M. V. Act
which is special law would prevail over Consumer Protection
Act.
 Cont..
Claim for compensation arising out of use of motor
vehicle cannot be adjudicated by the National
Commission.
The complaint in the case of motor accident cannot be
said to be in relation to any service hired or availed of
by the consumer because the injury sustained by the
consumer had nothing to do with the service provided
or availed by him but the injury is the direct result of the
accident.
The accident had nothing to do with service provided to
the deceased passenger.
 Cont..
This becomes obvious when one reads the provision
along with the definition of complaint in Section 2(1)(c)
and Service in Section 2(1)(o) of the 1986 Act.
Moreover the Motor Vehicles Act, 1988 and, in
particular, the provisions in Chapter XII thereof create
a Forum before which the claim can be laid if it arises
out of an accident caused by the use of a motor
vehicle.
That being a special law would prevail over the
relevant general law such as the Consumer Protection
Act
General Manager, Telecom v. M. Krishnan
and Another, 2009 INDLAW SC 1082
 Consumer Protection Act, 1986 - Indian Telegraph Act,
1885, s.7-B - - Jurisdiction of Consumer forums -
Matter relating to telephone bills - Due non-payment of
telephone bill telephone connection provided to
respondent No. 1 was disconnected - Respondent No.
1 filed a complaint before Consumer Forum -
Consumer Forum allowed the complaint –
 Writ petition filed before HC challenging jurisdiction of
Consumer Forum was dismissed –
 Writ appeal was also dismissed –
 Hence, present appeal to SC-
Section 7-B of the Telegraph
Act reads as under:
 Section 7B Arbitration of Disputes :
(1)Except as otherwise expressly provided in this Act, if any
dispute concerning any telegraph line, appliance or
apparatus arises between the telegraph authority and the
person or whose benefit the line, appliance or apparatus is,
or has been provided, the dispute shall be determined by
arbitration and shall, for the purpose of such determination,
be referred to an arbitrator appointed by the Central
Government either specifically for the determination of
that dispute or generally for the determination of disputes
under this Section.
(2)The award of the arbitrator appointed under sub-s. (1)
shall be conclusive between the parties to the dispute and
shall not be questioned in any Court."
Cont..
 Whether Consumer Forum has jurisdiction in matter
relating to telephone bills? –
 It is well settled that special law overrides general law
–
 Held, when there is a special remedy provided in s.7-B
of Telegraph Act regarding disputes in respect of
telephone bills, then remedy under Consumer
Protection Act is by implication barred
 Relied on Chairman, Thiruvalluvar Transport
Corporation Vs. Consumer Protection Council
 Impugned judgment of HC as well as order of District
Consumer Forum set aside - Appeal allowed.
Secretary, Thirumurugan Co-op.
Agrl. Credit. Socy. v. M. Lalitha, AIR
2004 SC 448
 Consumer Protection Act, S.3 - T.N. Co-operative
Societies Act,1983, S.90, S.156- CONSUMER
PROTECTION - CO-OPERATIVE SOCIETIES - Remedy
before consumer forum - Is in addition and not in
derogation to remedy under other Acts - Dispute between
Member and Co-operative Society - Jurisdiction of
Consumer Forum to decide dispute - Not ousted in view
of remedy of arbitration provided under S. 90 or 156 of T.
N. Co-operative Societies Act, 1983 - Question of conflict
of decisions in case party approaches both the consumer
Court and forum under Co-operative Societies Act - Does
not arise as it is for consumer forum to leave it to liberty
of complainant.
Cont..
Consumer Forum has jurisdiction to decide the dispute
between members and co-operative society as neither
S. 99 nor S. 156 of the Tamil Nadu Co-operative
Societies Act, 1983 ousts the jurisdiction of consumer
forum.
The remedies that are available to an aggrieved party
under the Consumer Protection Act are wider.
For instance in addition to granting a specific relief the
forums under the Consumer Protection Act have
jurisdiction to award compensation for the mental
agony, suffering, etc., which possibly could not be
given under the Act in relation to dispute under S. 90 of
T. N. Co-operative Societies Act.
Cont..
Merely because the rights and liabilities are created
between the members and the management of the
society under the Act and forums are provided, it
cannot take away or exclude the jurisdiction conferred
on the forums under the Consumer Protection Act
expressly and intentionally to serve a definite cause in
terms of the objects and reasons of Consumer
Protection Act.
Therefore the view taken by the State Commission
that the provisions under the T. N. Co-operative
Societies Act relating to reference of disputes to
arbitration shall prevail over the provisions of the
Consumer Act is incorrect and untenable.
Cont..
 From the statement of objects and reasons and the
scheme of Consumer Protection Act, it is apparent that
the main objective of the Act is to provide for better
protection of the interest of the consumer and for that
purpose to provide for better redressal, mechanism
through which cheaper, easier, expeditious and
effective redressal is made available to consumers.
 As per S. 3 of the Consumer Protection Act, the
provisions of the Act shall be in addition to and not in
derogation to any other provisions of any other law for
the time being in force.
Cont..
 Having due regard to the scheme of the Act and purpose sought
to be achieved to protect the interest of the consumers, better
the provisions are to be interpreted broadly, positively and
purposefully in the context of the present case to give meaning to
additional/extended jurisdiction, particularly when S. 3 seeks to
provide remedy under the Act in addition to other remedies
provided under other Acts unless there is clear bar.
Cont…
 Further, the question of conflict of decisions may not arise. If the
parties approach both the forums created under the T. N. Act and
the Consumer Protection Act, it is for the forum under the
Consumer Protection Act to leave the parties either to proceed or
avail the remedies before the other forums, depending on the
facts and circumstances of the case.
M/S National Seeds Corporation Ltd. V.
M.Madhusudhan Reddy And Anr. JT 2012 (1)
SC 330

The Supreme Court had to mainly consider whether

(i)the consumer forum has jurisdiction to entertain a
matter falling under Seeds Act, 1966
(ii)growers of seeds, who had purchased seeds from
and entered into agreements with National Seeds
Corporation Ltd. (NSCL), are covered by the definition of
`consumer' under s. 2(d) of the Act, and
(iii) the district consumer forum has committed a
jurisdictional error by awarding compensation to the growers
of seed without complying with the procedure prescribed
under s.13(1)(c) of the Act.
Cont..
 On the first issue, the Supreme Court held that
although a farmer who suffers loss of crop due to
defective seeds can approach the Seed Inspector
and to prosecute the person who supplied
defective seeds, the Seeds Act provides no
mechanism to compensate and redeem the loss
suffered by the farmer/grower.
 Hence, there is no justification in denying the
remedies under the Consumer Act to the
growers.
Skypay Couriers Limited v. Tata Chemical
Limited MANU/SC/0845/2000:(2000)5 SCC 294 &
Trans Mediterran Airways v. Universal Exports &
Anthr (2011)10 SCC 316

 Supreme Court observed that even if there exists an arbitration

clause in an agreement and a complaint is made by the consumer,
in relation to a certain deficiency of service, then the existence of
an arbitration clause will not be a bar to the entertainment under
the Consumer Protection Act, since the remedy provided under the
Act is in addition of any other law for time being in force.
M/s Emaar MGF Land Ltd Vs. Aftab Singh,
Rev.Petition 2629/2018, DD.08-12-2018

 the Consumer Act is a special social legislation enacted to

protect consumer rights, which establishes a level-playing field
between unequal players, i.e. consumers and large
Corporations, and is quite unlike other legislations that create
dispute resolution mechanisms between level players[3].
 by virtue of Section 2(3) thereof, the Arbitration Act itself
excludes from its purview certain disputes which fall within the
public law regime and with respect to which statutory remedies
are put into place to subserve a public policy. Since consumer
disputes would fall within the umbrella of the said provision,
they were not intended to be covered by the amendment to
Section 8 of the Arbitration Act.
Cont…
 the jurisdiction of the Consumer Forums to adjudicate upon
consumer disputes is not affected by either Section 8 (as
amended) of the Arbitration Act or by any other provision thereof.
 to accept the plea of the Builder would be to set at naught the
entire purpose and object of the Consumer Act, viz. to ensure
speedy, just and expeditious resolution and disposal of consumer
disputes.