Mr. Justice B.S. Yadav, Member ?

The facts leading to this Petition are that Shri Pawan Kumar Bairalia took a life policy from the Opposite Party – Life Insurance Corporation (for short the Corporation) on 28th December, 1975 for the sum of Rs. 50,000/-. He was husband of the present Complainant, Smt. Maina Devi Bairalia who was nominee under the policy. The insured paid the yearly premium at the time of taking the policy. He did not pay next yearly premium which fell due on 28th December, 1976. However, before he could pay the premium within the period of grace, he died on 11th January, 1977 in the Darbhanga Medical College and Hospital on account of sudden illness. Earlier to that he was keeping good health. The Complainant who is said to be 27 years of age at that time lodged a claim with the Corporation under the policy. She was not given any reply by the Divisional Office and did not acknowledge her letters in spite of reminders. She then wrote to the Chairman of the Corporation. Thereafter the Divisional Office of the Corporation sent a letter dated 18th November, 1982 to the Complainant which reads as follows:

“With reference to your complaint to our Chairman we have to inform you that the life assured died shortly after commencement of the policy and as such we have to undergo certain additional formalities in this case. As these formalities have not been completed, we have not been able to finalise consideration of the claim. We, however, assure you that we are trying our best to expedite completion of such formalities and as soon as these are over we shall write to you further in the matter.”

2. It is surprising that the Corporation could not complete the formalities for a period of more than 5 years. Thereafter, the Corporation again kept quiet and did not send any letter to the Complainant. On 30th October, 1984 even Mr. S.P. Singh, Agent of the Life Insurance Corporation, Darbhanga Branch wrote a letter to one Mr. Sarkar (some senior Officer of the Life Insurance Corporation). It will be useful to reproduce hereunder contents of that letter also to show the carelessness of the Corporation in the matter of settlement of the Complainant’s claim.

“Today when I contacted some responsible persons of this place to canvass for life insurance, they complained to me that the claim of the above deceased policy-holder is lying pending for the last so many years with the Muzaffarpur D.O. The widow who is the nominee in the above policy, I understand, wrote several times to the D.O. as also to the CO. but in spite of this the claim is still lying pending. The D.O. has not even acknowledged the letters of the nominee. I shall be highly obliged if you may kindly examine the matter at your level and see that the claim matter is settled without any further loss of time as already 6 or 7 years has lapsed since the submission of the claim forms by the nominee.”

However, in spite of it the claim of the complainant was not settled. She continued writing letters to the higher-ups in the Corporation as well as to the Minister of Finance, Government of India and the Speaker of the Lok Sabha. Lastly the Complainant got a letter published in the Editor’s column of newspapers Jansatta and Indian Express dated 2nd July, 1990 about her misery. On 2nd July, 1990 Zonal Manager, on reading the letter published in Jansatta, informed the Complainant that a copy of the letter was being sent to the Muzaffarpur Divisional Office for necessary action. The matter was also taken up by a couple of Members of Parliament with the Finance Minister, Government of India. On reading those letters published in the newspapers on 8th August, 1990, Deputy Secretary (Mktg./PS) of the Life Insurance Corporation wrote a letter to the Complainant. The relevant portion of the letter reads as follows:

“We have received a copy of your complaint dated 10.7.1990 addressed to the Finance Minister, through the Ministry of Finance, Government of India, New Delhi.

We have already taken up the matter with the Sr. Divisional Manager, Muzaffarpur D.O. and we have sent him a reminder today, advising him to give immediate attention to your complaint.”

The above narration of facts shows that the Corporation woke up from the long slumber only when the matter was taken up by the Finance Minister, Government of India. Thereafter, the Life Insurance Corporation on 19th November, 1990 wrote a letter to the Complainant informing her that the liability under the policy has been admitted by them on ‘ex-gratia basis’. Along with that letter a voucher of discharge was also sent for being executed by the claimant to enable the Corporation to arrange for payment of Rs. 50,310/- by a cheque. It may be mentioned here that in that letter it was not at all made clear why the liability has been admitted on ex-gratia basis. On that voucher which was to be executed by the complainant in full satisfaction of the claim under the policy, she made a mention about her being entitled to penal interest and then executed the voucher and sent it back. On December 13,1990 another voucher for execution was sent to the Complainant asking her not to make any additions or alterations. It appears that being frustrated by the conduct of the Corporation, the claimant executed the voucher and sent it back to the Corporation. A cheque for Rs.50,310/- was then sent to the complainant by the Corporation with a covering letter dated 4th February, 1991. Thereafter, the Complainant served a notice through a counsel upon the Corporation narrating her tale of woe and harassment and claimed the following amounts from the Corporation.

1. (a) Interest on the insured amount i.e. Rs. 50,000/- @ 15% for the period of 13 years

(11.1.1977 to 4.2.1991) Rs. 2,89,125/-

(b) Bonus for the period of 24 years –

(c) Expenses incurred in pursuance of the claim. Rs. 10,000/-

2. Compensation for the following:

(a) Mental torture Rs. 1,00,000/-

(b) Physical harassment Rs. 1,00,000/-

(c) Economical suffering Rs. 1,00,000/-

(d) Loss of business Rs. 5,00,000/-

3. The Corporation chose to ignore that notice. Thereupon, the Claimant filed the present complaint complaining about the negligence on the part of the Corporation in the rendering of the service. She prays for the aforementioned amounts. She also added one more item for Rs. 7,884/- as bonus on the amount assured.

4. The Corporation contested the complaint. In their counter they have pleaded that the Complainant had received the sum of Rs. 50,310/- against receipt in full and final settlement of her claim under the policy in question. It was also pleaded that complaint was time barred as the assured had died on 11th January, 1977and the complaint was being filed in 1992. On merit it was pleaded that at the time of taking the policy the assured had suppressed and concealed material facts with regard to his state of health. That in fact as per the investigations carried out by the Officer of the Corporation the deceased was admitted in Darbhanga Medical College and Hospital on 28th July, 1975 under registration serial No. 277.

5. We have heard the learned Counsel for the parties. It has to be mentioned at the outset that the conduct of the Corporation in this case has been thoroughly objectionable and unfair. The complainant who is a widow had to fight for her claim under the policy for about 14 years. She had to approach high Officers in the Corporation as well as the Finance Minister, Government of India and also to get published letters in the editorial columns of Jansatta and Indian Express before the Corporation ultimately woke up.

6. In the counter it is mentioned that the assured had suppressed and concealed material facts. It is not clear from the counter that at what point of time the Corporation came to know about the alleged admission of the assured in the Darbhanga Medical College and Hospital on 28th July, 1975 under registration serial number 277. No documentary evidence has been filed about the alleged admission of the assured in the said Medical College and Hospital nor it is stated as to what was the nature of the disease the assured was suffering from at the time of his alleged admission.

7. At no point of time the claim of the Complainant was properly investigated nor was it brought to the Complainant’s notice at any time that the assured had suppressed or concealed any material fact at the time of submitting the proposal for insurance. The Corporation did not also repudiate the claim at any time. If any material fact had been suppressed or concealed by the assured at the time of taking the policy the Complainant ought to have been informed about that. However, this was not done. In the voucher earlier sent for execution to the Complainant the words “ex-gratia” have not been used. The Complainant wrote on the voucher “the penal interest on the above amount should also be paid to me” and signed below that endorsement. The Corporation sent another voucher Photostat copy of which is at page 55.

In that the words “on ex-gratia’ basis were introduced. As noticed above Complainant signed that voucher in utter frustration and under duress and coercion as otherwise the Corporation was unwilling to pay her even the amount of Rs. 50,310/- after the long lapse of time.

We hold that in the present case the Corporation has been highly negligent in the performance of its services. The Complainant has suffered hardship and loss on account of the deficiency in service. We hold that the Complainant is entitled to recover interest @ 12% per annum on the amount of Rs. 50,310/- from the date of expiry of three months from the death of the assured till the amount was paid to her on 4th February, 1990. The signing of the discharge voucher by the Complainant will not disentitle her to claim interest since we have found that she had executed the receipt under duress and coercion. The Complainant is also awarded Rs. 15,000/- as compensation for mental torture and harassment. She is also awarded Rs. 3,000/- as her costs of the present proceedings. Her claim in respect of other items is disallowed.

The post Maina Devi Bairalia Vs. Life Insurance Corporation appeared first on B&B Associates LLP.

B.S. Yadav, Member:

1.The appellants are the Branch Offices of the M/s. Skypak Couriers Pvt Ltd., who is carrying on business as Couriers. The Respondent No. 1 is Consumer Education and Research Society, a Registered Association while Respondent No. 2, Faruk Hussain Shaikh is the representative of Mr. Mussader Alikhan (for short Mr. Khan), a consumer in the present case. The complaint which has given rise to the present appeal was filed before the State Commission, Gujarat at Ahmedabad by the present respondents.

2. According to the complaint, Mr. Khan was working as a Chief Executive with M/s. Mahendra Suitings Ltd. at Ahmedabad. By virtue of his expertise and varied experience in his profession, the was selected as Jacquard and Installation Manager with M/s. Sulzer Nigeria Ltd., Lagos (Nigeria), a leading textile group in Nigeria having world wide business. Mr. Khan was required to assume his duty on the 6th March, 1990 and his training programme was arranged by his new employers through M/s. Sulzer Brothers Ltd., Switzerland. The training programme was to be followed by further training in Germany and thereafter he was to take independent charge of weeving unit of the said new employer at Lagos, Nigeria. The entire training programme was organised well in advance in order that Mr. Khan could take charge after completing the training at Lagos by April, 1990. Arrangement for air ticket, visas etc. for Mr. Khan were to be arranged by the new employer’s travel agents, M/s. Mona Travels, New Delhi. Mr. Khan deposited his passport, Degree Certificates and other original testimonials with M/s. Mona Travels, for obtaining the necessary visas and air ticket etc. Mr. Khan was to fly on 4th March, 1990 from Ahmedabad to Zurich via Bombay. Mr. Khan had instructed M/s. Mona Travels to send his visas, air ticket, passport, original Degree Certificates, testimonials and other relevant documents pertaining to his journey through the appellant, Skypak Couriers Pvt. Ltd. so that he could receive them in time. M/s. Mona Travels, sent all relevant documents through the above Couriers on the 10th February, 1990 under consignment No. 215882. It was a ‘To Pay’ consignment and consideration for such services was promised to be paid to the couriers by Mr. Khan. The consignment was to be delivered at his Ahmedabad address. The consignment was expected to reach Mr. Khan on 11.2.1990 but it was not delivered to him. He waited upto 13th February, 1990 on which date he contacted the Branch Office of the Couriers at Ahmedabad but was given no response. Mr. Khan contacted M/s. Mona Travels as well as the Bombay Office of the Courier about the non-delivery of the consignment in question. M/s. Mona Travels also contacted the offices of the Couriers. However, inspite of various communications between different branch office of the Couriers i.e. appellants, the consignment could not be traced. In the absence of the necessary visas, passport etc. Mr. Khan could not commence his journey on 4th March, 1990 and consequently could not attend the training programme on the 6th March, 1990. For obtaining a temporary passport in a short time, he lodged a First Information Report at Ahmedabad, as advised by the above travel agency. Mr. Khan was informed by the Couriers that the consignment had been lost. He obtained a fresh passport, new Degree Certificates, new air ticket, new visas and new copies of relevant other documents. He was enrolled in the next batch of training programme. He left for Zurich on 16th April, 1990. However, he was asked by his employer to join duty at Nigeria, without undergoing training.

3. It is further the case of the complainants that Mr. Khan had promised to pay Rs. 65/- for the services which were to be rendered by the Couriers i.e. the opposite party (now appellants). As the consignment was not delivered to him there was gross negligence on the part of the opposite party in losing the consignment and thus there was deficiency in the rendering of services by them. Mr. Khan suffered a huge amount of monetary loss by remaining jobless from 4th March, 1990 to 18th April, 1990. He also lost future prospects by not being able to undergo training. He assessed his loss for future prospects at Rs. 1,15,000/- and at Rs. 35,000/- towards loss of salary from 4th March, 1990 to 18th April, 1990. According to him, he had also to spend Rs. 4,658/- for obtaining a copy of his Degree Certificate, Rs. 2,959/- for getting his new air tickets and visas, Rs. 515/- for obtaining new copy of his passport. The complainants also claimed Rs. 1 lakh for the agony and hardship suffered by Mr. Khan in obtaining new copies of the documents and for remaining unemployed for some time. Thus in all, the complainant claimed Rs. 2,58,102/- from the opposite party.

4. The appellants resisted the complaint. Some preliminary objections were taken to the effect that M/s. Mona Travels, New Delhi was the only contracting party with them and as the whole cause of action accrued outside the territorial jurisdiction of the State Commission, Gujarat, the said Commission had no jurisdiction to entertain the complaint. Moreover it is mentioned in the courier consignment note that ‘Disputes subject to jurisdiction of Bombay Courts only’ and, therefore, on that ground also the said Commission had no jurisdiction to decide the present dispute. It was also averred that M/s. Mona Travels was a necessary party.

5. On merits it was pleaded that the opposite party’s liability was limited to a maximum of U.S. $100 in case of international consignment and Rs. 100/- maximum for intercity and Rs. 1,000/- for domestic consignment and this term is clearly mentioned in part 7 of the terms of the servicing and in case the consignment was of higher value than the indicated limited liability, then it would be advisable for the consignee to have a transit insurance policy; that the consignment in question was not got insured by M/s. Mona Travels that the consignment was not on ‘To Pay’ basis and that it was on credit basis and M/s. Mona Travels was a regular credit client; that the contents of the consignment were not declared by M/s. Mona Travels; that according to the First Information Report lodged by Mr. Khan on 21st February, 1990 he himself had lost his passport at Ahmedabad and, therefore, he could not ask for the expenses incurred by him in obtaining new copy of the passport; that at the relevant time and period Overnite/ OBC Couriers were haying an agreement with the opposite party for bringing all consignments from Delhi to Ahmedabad and the consignment in question was handed over to the said couriers and therefore, the said Couriers were also necessary party to the present dispute.

6. The opposite parties i.e. appellants also disputed the amounts of compensation claimed by the complainants. The appellants did not dispute the fact that the consignment in question handed over to them for carriage to Ahmedabad has not been delivered to Mr. Khan till today.

The State Commission vide their Order held as follows:

(i)The consignment was to be delivered to Mr. Khan (by mistake in the Order the name of the Complainant No. 2 Dr. Faruk has been mentioned as the consignee).

(ii)Under instructions of Mr. Khan, M/s. Mona Travels sent the documents under the consignment note in question and the appellants were, therefore, under legal obligation to deliver the said consignment to him and as they failed to do so they are guilty of non-delivery.

(iii)The consignment was to be delivered at Ahmedabad and hence they (The State Commission) had jurisdiction to entertain the complaint. The agreement that only Bombay Courts had jurisdiction to decide the dispute was not valid and unenforceable and, moreover, the Bombay Courts had no jurisdiction as the consignment was despatched from Delhi and had to be delivered at Ahmedabad.

(iv)M/s. Mona Travels was not a necessary party as Mr. Khan was the consignee and beneficiary of the consignment and the relief has been sought against the Couriers only.

(v)The objection of the Couriers that liability of the opposite party was limited to Rs. 100/- did not carry any weight as the printed memo containing the above condition was neither signed by any body nor there was any evidence to show that the terms printed therein were shown to the consignor or the consignee or that the same were agreed upon by the consignor.

(vi)It had been proved beyond doubt that the consignment contained passport, visas, air tickets, Degree Certificate etc. which were absolutely necessary for Mr. Khan’s travel to Zurich for training.

(vii)On account of the non-delivery of those documents Mr. Khan could not reach and report for training at Zurich, which was to start from March 6, 1990 and he had to obtain new passport etc. and he had to join his duties at Nigeria without undergoing any training.

(viii)As the Couriers have not explained what really had happened to the consignment, there was deficiency in the rendering of service amounting to negligence, and were, therefore, liable to pay damages. Rs. 10,000/- was assessed as loss of salary from March 4, 1990 to April 19, 1990, Rs. 6,000/- were assessed as loss for future prospects as Mr. Khan had to resume his duty at Lagos (Nigeria) without training. Rs. 4,068/- was assessed as expenses incurred by Mr. Khan in obtaining copies of Degree Certificate, Rs. 1,000/- of costs were also awarded to Complainant No. 1 i.e. the Consumer Education and Research Society.

The opposite party was asked to pay the above amount within 4 weeks from the day the Order was announced. It was further ordered that in case the amount was not paid within that period, it would carry interest at the rate of 18 per cent from the date of judgment till the date of payment.

7. Feeling aggrieved against the above Order the Appellants, as mentioned earlier, who are the branch offices of the Skypak Couriers have filed the present appeal.

8. On the date the appeal was heard the Counsel for the appellants was absent His Junior Counsel appeared on his behalf and requested for an adjournment. We did not find the ground advanced by him for the absence of the Senior Counsel as satisfactory. We refused to grant adjournment. The said Junior Counsel could not advance any arguments. We have heard the opposite party and have gone through the file.

9. After hearing the opposite party and going through the file we do not find any infirmity in the Order of the State Commission. The objections raised by the appellants in the written statement and urged before the State Commission have been discussed in detail by the Commission and they have given sound reasons for rejecting the various preliminary objections raised by the appellants.

10. We may take one of the allegations which has not been discussed by the State Commission in detail. It has been repeated in the ground of appeal. The objection is that in the First Information Report lodged by Mr. Khan, he had mentioned that he had lost the documents himself in Ahmedabad. As he was in urgent need of the passport etc. Mr. Khan might have made a wrong statement in the First Information Report. We have not been able to understand how that statement contained in the First Information Report helps the appellants. It is not in dispute that the consignment in dispute has not been delivered to Mr. Khan upto today and that has been lost by the Couriers. There is the finding of the State Commission that, in addition to other documents, the consignment contained, the passport also.

11. We have also gone through the amounts? awarded by the State Commission to Mr. Khan through his authorised representative Dr. Faruk (Complainant No. 2). All the items awarded appear to be reasonable except item of Rs. 6,000/- awarded as compensation for the loss of future prospects. There was no evidence to support that item except the bare statement of the Complainant No. 2 in the affidavit. However, Mr. Khan must have suffered some loss of future prospects as he had to join his duties without any training. We think that Rs. 1,000/- would be sufficient compensation to Mr. Khan for the loss of future prospects. Accordingly, we reduce this item of compensation awarded by the State Commission under this head to Rs. 1,000/-.

12. For the reasons aforesaid, we modify the Order of the State Commission to the extent that instead of Rs. 6,000/- the Complainant No. 2 would be entitled to only Rs. 1,000/- as compensation for the loss of future prospects. In other respects we do not find any force in the present appeal and dismiss the same with costs which we assess at Rs. 1,000/-.

Per Se Y. Krishan, Member

The State Commission had in this case come to the finding that the consignment of the complainant contained valuable materials and the same was lost due to negligence of the appellant Courier and, therefore, awarded damages as under:

1. Rs. 10,000/- as compensation for consequential loss of salary suffered by the complainant due to delay in getting a job in Nigeria in Lagos.

2. Rs. 4,068/- as expenses incurred by the complainant in obtaining duplicates of the documents.

3. Rs. 6,000/- by way of loss of future prospects. This has been reduced in the order above to Rs. 1,000/-.

4. An amount of Rs.1,000/- by way of costs by the State Commission.

5. Rs. 1,000/- as costs by the National Com-mission as per the Order proposed above.

2. The important question to be considered in this case is the liability of the Courier under law for loss of a consignment entrusted to its custody and transportation. During the hearing, Dr. Saraf, the Counsel for the Respondent complainant stated that the responsibility under law of the Courier is entirely different from that of a Carrier. I have not been able to find any legal provision or case law defining the responsibility and liability of a Courier as such for consignments delivered to it for purposes of carriage and delivery.

3. In the Courier Consignment Note executed in this case, it is printed that it is ‘Subject to standard conditions of carriage available on request. The Courier specifically limits its liability to a maximum of U.S. $100 per consignment for any cause’. From this it would appear that the Courier has assumed the rights and liabilities of a carrier presumably under the Carriers Act; he has also limited his liability to a maximum of U.S.$ 100 per consignment, on the face of the consignment note besides limiting his liability in the standard conditions of carriage which are made available on request of consignors.

4. It is also seen from the photocopy of the Courier Consignment Note in the paper book that the column ‘Description’ and ‘Declaration of the contents of the proposal’ (We declare that this proposal contains only commercial documents/ samples which are not of personal nature) have been left blank. Thus the consignor M/s. Mona Travels had sent the relevant documents like Passport, Visa, Air travel ticket etc. through the Courier without disclosing the contents of the packet. In my opinion it was obligatory on the part of the consignor to have disclosed the contents of the packet so that it could have been got insured if necessary.

5. Another important question is whether it has been proved beyond doubt that the consignment contained Passports, Visas, Air Tickets, Degree Certificates etc. of Mr. Khan. This is based on the admission of the Courier appellant, M/s.. Skypakin their letter of 20th February, 1990 written to the Respondent No. 2 Mr. Farukh. This admission cannot be used against the Courier. The Courier must have prior knowledge of the contents of the packet. If these were not communicated to the Courier at the time of booking the consignment, we cannot attribute any knowledge of the contents to the Courier and hold him liable for the loss.

6. It may also be further noted that in the F.I.R. lodged by Mr. Khan the consignee, about the loss of Passport, Visa etc., he had stated that the documents had been lost by himself (and not by the Courier). If he had given a false statement regarding the person who had lost the consignment, we cannot support his contention in these proceedings that the consignment containing the documents was lost by the Courier.

7. The reliefs granted by the State Commission are excessive, being in excess of liability limited to US $100/- per consignment on the face of the Courier-consignment note executed on behalf of the complainant by his Travel Agent. Besides the Courier is liable only for a nominal amount as consignor did not declare the contents of the consignment. In other words, the Courier’s liability will be limited to loss of a packet of unknown contents as such instead of the loss of valuable documents like passport, visa, air-ticket etc. and whose loss prevented him from taking up a new and lucrative job in time I assess the quantum of loss payable at Rs. 100/- only in this case. The Order of the State Commission is set aside. The respondent claimant is entitled to refund of the Courier consignment freight plus Rs. 100/- only as damages. There is no order as to costs.

Appeal dismissed.

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B.S. Yadav, Member
1. Both the Revision Petition Nos. 175 and 247 of 1992 can be disposed of by this common order as the point involved is similar.

2. In Revision Petition No. 175 of 1992 the Complainant, Dr. U. Shanker Rao, Medical Director, M/s. National Medical Hospital, Second Line Beach, Madras decided to celebrate the Fifteenth Anniversary of his hospital on 11th March, 1990 at Hotel Woodlands, Madras. It was presided over by the Minister of Health of the Government of Tamil Nadu. It is alleged that about 600 invitation letters were issued and put into post at the Central Post Office, Madras on 5th and 6th March, 1990 which were addressed to Industrialists and Bankers etc. Most of the invitations are said to have reached the invitees on 13th and 14th March, 1990 and the function on 11th March, 1990 proved to be a poor show as only 200 persons attended it. According to the Complainant there was gross deficiency in service and negligence on the part of the Postal Department. He claimed damages in the sum of Rs. 75,661.50.

3. The complaint was resisted by the Opposite Parties. It was contended that no record of unregistered article is kept. The number of invitations posted by the complainant could not be ascertained by the Department. The delay, if any, was not wilful or intentional. The Opposite Parties also relied upon Section 6 of the Post Office Act and the guidelines prepared by the Department to defeat the claim.

4. The District Forum, Madras believed the averments contained in the claim petition and awarded Rs. 12,929/- as compensation to the Claimant. It was further ordered that the said amount be paid within 30 days of the despatch of the order failing which the Opposite Parties were ordered to suffer simple imprisonment for three months.

5. Feeling aggrieved the Opposite Parties filed an appeal before the State Consumer Disputes Redressal Commission, Tamil Nadu, Madras. On behalf of the Department, reliance was placed upon Section 6 of the Indian Post Office Act and guidelines of the Department. It was held by the State Commission that those provisions constituted no defence when an action for compensation for deficiency of service or negligence is instituted under the Consumer Protection Act, 1986 (for short the Act). Accordingly the appeal was dismissed. Feeling aggrieved, the officers of the Postal Department mentioned above in the heading of Revision Petition (No. 175 of 1992) have come up before this Commission.

6. In Revision Petition No. 247 of 1992, Consumer Rights Protection Council representing Mr. Pitcharaman, had filed a complaint before the Consumer District Forum, Madurai against the officers of the Postal Department who are now Petitioners in the Revision Petition. The facts of the case are that the Complainant, Mr. Pitcharaman had sent one consignment of handloom towels to M/s. Renuka Hosiery, Calcutta through Economic Roadways Corporation under Lorry Receipt No. 1653835. The original Lorry Receipt was sent by the Complainant to Syndicate Bank, Calcutta by registered post with acknowledgement due through the Post Office, Sellur to the Syndicate Bank, Calcutta to be received by the Consignee before taking delivery. The acknowledgement was not received back by the Complainant. The Complainant learnt that the registered letter was not received by the Bank. He further learnt that some other person had taken delivery of the consignment from M/s. Economic Roadways Corporation on the basis of the said lorry receipt. It was alleged that due to the carelessness, negligence and misconduct of the Postal Authorities, the registered letter containing the original lorry receipt had fallen into the hands of some unscrupulous person who used it. The Complainant claimed Rs. 3,185/- as compensation for the value of the consignment plus Rs. 3,000/- for mental agony etc. plus Rs. 500/- towards expenses incurred. The Opposite Parties in their counter admitted the booking of the registered letter and averred that on inquiry it was found that the registered letter had reached the Calcutta R.M.S. but its further disposal was not known. According to the Opposite Parties the letter had been lost in the Calcutta R.M.S. In that case also Opposite Parties placed reliance upon Section 6 of the Indian Post Office Act and pleaded that the Government was not liable for any loss of any postal article in the course of transmission and no officer of the Post Office incurs any liability by reason of such loss unless he has caused the same fraudulently or by wilful act or default.

7. The District Forum directed the Postal Department to pay the amounts claimed by the Complainant plus Rs. 250 as costs of the proceedings.

8. Feeling aggrieved against that order the Postal Authorities filed appeal before the State Consumer Disputes Redressal Commission, Tamil Nadu, Madras. The Opposite Parties placed reliance upon Section 6 of the Indian Post Office Act and guidelines issued by Postal Department. That plea was brushed aside by the State Commission by remarking that it was no longer available to the Postal Department, after the passing of the Act, which has been put on the Statute Book specifically for the purpose of providing the consumers a cheap, speedy, inexpensive and expeditious remedy against deficiency in service, whether that deficiency is committed by the Government or any private body provided only that the services are hired by the consumer. It was also remarked that the Lorry Receipt was an important document and was sent by registered post but in a casual and cavalier manner, the Opposite Parties averred that though the letter had reached Calcutta RMS but from there it was lost and thus it only indicated extreme apathy and indifference, want of due negligence and care amounting to gross negligence on the part of the Postal Department. Accordingly the appeal filed by the Postal Authorities was dismissed and the award of the District Forum was upheld.

9. Feeling aggrieved against that order the Postal Authorities have come before this Commission in revision (No. 247 of 1992).

10. After hearing the parties we are of the opinion that the argument of the learned counsel for the respective Revision Petitioners has force. It was rightly argued that Section 3 of the Act clearly lays down that the Provisions of the Act are “in addition to but not in derogation of the” provisions of any other law for the time being in force. This shows that the Act provides additional means of obtaining remedy by a consumer but if the remedy is barred under any other Act, then the various Forums constituted under the Act cannot grant the remedy prayed for.

11. Section 6 of the Indian Post Office Act reads as follows : “The Government shall not incur any liability it reasons of the loss, misdelivery or delay or damage to, any postal article in course of transmission by post, except in so far as such liability may in express terms be undertaken by the Central Government as hereinafter provided, and no officer of the Post Office shall incur any liability by reason of any such loss, misdelivery, delay or damage, unless he has caused the same fraudulently or by his wilful act or default.” Counsel for the Revision Petitioner inter alia relies on the said provision and contends that no claim will lie against the Postal Department or its officers merely on the ground that there has been loss misdelivery, delay or damage of any postal article in the course of transmission by the Postal Department unless the same has been caused fraudulently by the officer complained against of the post office or by his wilful act or any default. Under the scheme of the Act the claim for compensation will lie at the instance of the consumer only if there is deficiency in service. According to the Revision Petitioners the statutory protection to the Central Government which is in absolute terms stands as an exception to the general law relating to the commercial carriers. Post office is a branch of public service functioning under a statute and the liability for misdelivery or late delivery of an article can be fastened on the postal department or its officers only on the basis of express provisions of the Post Office Act. The services rendered by the Post Office are merely statutory and there is no contractual liability. Establishing the Post Offices and running the postal service the Central Government performs a governmental function and the Government does not engage in commercial transaction with the sender of the article through post and the charges for the article transmitted by post is in the nature of charges imposed by the State for the enjoyment of the facilities provided by the Postal Department and not in consideration of any commercial contract. The Post Office cannot be equated with a common carrier.

12. We are of the opinion that both the claim petitions referred to above are not maintainable in view of Section 6 of the Indian Post Office Act. As noticed earlier there is no allegation that the loss, misdelivery or delay occurred on account of fraudulent or wilful act of any particular postal employee.

13. We do not think it necessary to go into the averments of facts contained in those claim petitions in view of the legal position discussed above. However, we may point out that the order of the District Forum which has been referred while narrating the facts of Revision Petition No. 175 of 1992 is bad in the eye of law to the extent that the Forum has passed a composite order. While awarding compensation to the claimant, the Forum has also passed an order under Section 27 of the Act for non-payment of the amount within a certain period. It has been repeatedly held by this Commission that such a composite order should not be passed by the various forums constituted under the Act. Before passing an order under Section 25 and 27 of the Act, an opportunity should be given to the defaulting party to show cause that why such an order should not be passed. The party can show reasonable grounds. After taking into consideration those grounds the Forum can pass an appropriate order. However, we do not want to dwell on that part of the order any further. 14. For the foregoing reasons we accept both the Revision Petitions and set aside the orders of the State Commission as well as of the District Forum in each of those Revision Petitions and dismiss the complaints. In both the Revision Petitions we do not make any order as to costs.

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JUDGEMENT

Mr. Justice V. Balakrishna Eradi, President?

These two connected appeals have been filed by Opposite Party Nos. 1 and 2 respectively in Original Petition No. 112 of 1991 on the file of the State Consumer Disputes Redressal Commission, Madras. The appellant in Appeal No. 82 of 1992 is the Indian Oil Corporation Ltd. (Opposite Party No. 1) and the connected appeal (Appeal No. 85 of 1992) has been filed by M/s. Vijaya Kanna Agencies who are the Indane Gas Distributors of the Indian Oil Corporation at Palani.

2. The first respondent herein (the first complainant before the State Commission) had subscribed for two L.P.G. cooking gas cylinders and was a customer registered with the second opposite party, the distributor. On April 23,1991 the second opposite party through one of its delivery boys, delivered one gas cylinder at the residence of the first complainant and it was being kept there as a spare second cylinder. On May 16,1991 at about 11 a.m. when Complainant No. 1 and his wife and minor grandson who are complainant Nos. 2 and 4 respectively were inside the kitchen at their residence, Shanthi the deceased daughter of complainant Nos. 1 and 2 who was boiling some water on the gas stove found that the gas in the cylinder which was till then in use was exhausted. Thereupon she put out the stove, removed that cylinder and attempted to connect the spare cylinder supplied by the Opposite Party No. 2 when there was a burst resulting in the gas escaping and catching fire. The deceased Shanthi was caught in the fire and her clothes were enveloped in flames with the result that she suffered extensive burns. She was immediately admitted in the Government Hospital, Palani but she succumbed to the burn injuries on May 19, 1991. According to the complainants the accident was caused due to the defective nature of the cylinder supplied to the first complainant on April 23, 1991 and hence Opposite Party Nos. 1 and 2 are liable to compensate the complainants for the grave loss suffered by them by reason of the death of deceased Shanthi. Opposite Party No. 3 in the complaint petition is the United India Assurance Company with whom a policy of insurance had been taken by the second opposite party for the benefit of itself and the first opposite party covering against the risk of all liabilities to customers which may arise on account of accidents.

3. The defence put forward by the first opposite party in the counter statement filed on its file before the State Commission was that the LPG cooking gas cylinders supplied by it to the distributor are thoroughly checked and great care is taken to ensure that they are free from any defect. The counter statement proceeded to state that the delivery boys had clear instructions to test the cylinders for any possible defects in the presence of the customers concerned. But in the instant case at the specific request of the complainant the delivery boy delivered the cylinder without the necessary check at the customer’s premises. In other words, the case put forward by Opposite Party No. 1 was that the complainants had prevailed upon the delivery boy not to remove the seal of the cylinder and thereby prevented him from conducting the checks at the customer premises. The first respondent denied that the cylinder or any of the related equipments was defective or there was any negligence or deficiency on the part of the Indian Oil Corporation. On this basis the first respondent denied any liability for payment of any compensation to the complainants.

4. The contention put forward by the second opposite party was that before delivering the gas cylinder to the complainant on April 23, 1991 the best possible re-check of the gas cylinder had been done by its technically qualified delivery boy and hence there was no deficiency in service nor any negligence on its part. The sole plea raised by the third opposite party namely, the United India Assurance Company was that its liability was only to indemnify the first and second opposite parties in respect of all sums which the insured may be found to be legally liable to pay as compensation in respect of any accident besides litigation expenses incurred in the said connection and there was no liability on the part of the Assurance Company to pay any compensation directly to the complainants.

5. Before the State Commission the first complainant examined himself as P.W. 1 and on the side of the opposite parties, one P. Murugantham was examined as R.W. 1 claiming that he was the delivery boy who delivered the ill fated cylinder. One M. Silvraj Assistant Manager, Indian Oil Corporation was also examined as R.W. 2.

6. The State Commission has carefully analysed the oral and documentary evidence in the case. It has given sound and convincing reasons for coming to the conclusion that the version put forward by R.W. 1 that, it was he who delivered the gas cylinder, could not be believed as true. It is rightly pointed out that there was a direct contradiction between the case put forward by the first respondent and the plea taken by the second respondent on the question whether a re-check of the gas cylinder had been conducted by the delivery boy at the time of delivery at the residence of P.W. 1 the State Commission held that on the evidence it was clear that no re-checking of the gas cylinder had, in fact, been done by the delivery boy at the time when the cylinder was delivered and that this amounted to a clear deficiency inasmuch such are-checking of the cylinder was mandatory under the procedure laid down for supply of cooking gas cylinders. We find no reason whatever to differ from the said conclusion recorded by the State Commission.

If only a proper re-checking of the gas cylinder had been conducted at the time of its delivery to the customer the defect in the value would have been then discovered and the unfortunate accident would not have happened. It has clearly come out in evidence that when, on May 16,1991, the deceased Shanthi attempted to connect the spare cylinder to the stove there was a bursting out of gas which on coming into contact with the hot surface of the extinguished stove got ignited and the fire spread to the clothes worn by deceased Shanthi, engulfing her in flames. P.W. 1 was an eye witness to the whole incident. Accepting his testimony, the State Commission found that what actually took place was that when the deceased Shanthi tried to fix the regulator, due to the defective nature of the valve, the pin in the valve pierced deep leading to the bursting forth of the gas from the cylinder. In the opinion of the State Commission it had been clearly established that the accident was caused due to the defective nature of the valve in the gas cylinder. Though a plea had been advanced by the Opposite Parties that chemically gas cannot get ignited by coming in contact with any hot thing unless there is a naked flame and that there was a naked flame in a lamp kept in the almirah in the kitchen for performing of pooja it was rightly rejected by the State Commission accepting the evidence of P.W. 1 that the pooja was over in the early morning itself and there was no naked flame in the lamp at the time of the occurrence of the accident. After having ourselves independently considered the entire evidence we are in complete agreement with the aforesaid findings of the State Commission and have no hesitation to affirm the conclusion recorded by it that the accident in question had been caused only because of the defective nature of the valve in the gas cylinder.

7. The question of quantification of damages has been carefully discussed by the State Commission from the correct legal perspectives and we find no justification whatever for any interference with the directions issued by it that Opposite Party Nos. 4 and 2 should pay the Complainant Nos. 3 and 4 (husband and minor son of deceased Shanthi), Rs. 1 lakh as damages on the ground of loss of expectation of her life and the pain and suffering undergone by the deceased and that they should also jointly and severally pay to the Complainant No. 3 (husband of the deceased Shanthi) a sum of Rs. 50,000/- for loss of consortium. We also confirm the further direction issued by the State Commission that the Opposite Party Nos. 1 and 2 should pay to the Complainant Nos. 1,2 and 4 Rs. 1,000/- each for the injuries sustained by them. Thus the award of compensation made as above by the State Commission is hereby upheld.

8. The State Commission is right in holding that the liability of the Assurance Company is only to indemnify Opposite Parties Nos. 1 and 2 against their liabilities in respect of the claim made against them by the customer.

9. We accordingly confirm the order passed by the State Commission and dismiss both these appeals with costs, which we fix at Rs. 3,000/- in each appeal payable to the respondents by the concerned appellant in the respective appeal.

10. Pursuant to the interim order dated March 25, 1992, passed by this Commission granting a conditional stay to the appellant in First Appeal No. 82 of 1992, a demand draft for Rs. 40,000/- drawn in favour of the first respondent has been deposited by the said appellant in the Registry of this Commission. The said demand draft forthwith will be made over or despatched by the Registry to the first respondent. The balance amount due by the appellants to the respondents under the State Commission’s Order as also the costs payable to them under this Order shall be paid to the concerned respondents by the appellants within a period not exceeding six weeks from today.

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JUDGEMENT

B.S. YADAV, J.

( 1 ) THIS order will dispose of both the above titled appeals as they arise out of the same passed by State Consumer Disputes Redressal Commission, Karnataka at Bangalore in Complaint No. 70/92. The said complaint was filed by Mr. S. P. Dhavaskar (appellant in F. A. No. 203 and respondent in F. A. No. 342 and hereinafter referred to as complainant) against Housing Commissioner, Karnataka Housing Board, (respondent in F. A. No. 203 and appellant in F. A. No. 342 and hereinafter referred to as the opposite party ). The case of the complainant before the State Commission was that pursuant to an advertisement issued by the opposite party for allotment of houses under HUDCO scheme he applied for allotment of a house by depositing a sum of Rs. 5,000/- on 10th April, 1987. The opposite party allotted House No. MIG-42, Yelahanka, Bangalore in favour of the complainant on 20th February, 1990. The complainant as per the instructions contained in the allotment letter deposited Rs. 80,000/- in four installment of Rs. 20,000/- each on 19th April, 1990. 17th May, 1990, 20th June, 1990 and 21st July, 1990. The complainant further made a deposit of Rs. 81, 000/- on 25th September, 1990. Thus in all he paid a sum of Rs. 1,66,000/ -.

( 2 ) THE complainant next averred that as per the advertisement issued by the opposite party, the construction of the houses was to be completed within two years from 3rd March, 1987 but the opposite party did not deliver the possession of the allotted house during that period in spite of repeated reminders. The complainant received an intimation on 21st March, 1992 stating that the construction of the houses was not upto the expected level because of the use of low cost technology and so they have developed distress and might not last long and so the opposite party was unable to hand over the possession of the allotted house to the complainant. The opposite party further intimated the complainant and other allottees either to take refund of the amounts already deposited without interest or opt for allotment of new house (ground plus two floor tenements) in lieu of the houses already allotted and agreeing to bear difference in cost. According to the complainant the service rendered by the opposite party is deficient in not delivering possession of a properly constructed house. He claimed compensation in the sum of Rs. 4,65,080/- on various counts including refund of Rs. 1,66,000/ -.

( 3 ) THE case of the opposite party as appears from memorandum filed in First Appeal No. 342, the Karnataka Housing Board (for short the Board) formulated a composite housing scheme of constructing 707 houses adopting a new technology by using soil stablished mud blocks to popularise the low cost technology. Such houses were constructed and one house was allotted to the complainant. However, during the month of September and November, 1991 due to heavy rains in Bangalore it was noticed that the soil stablished mud blocks used for superstructure have shown signs of distress and in the circumstances a three member committee was appointed for inspection and giving report. Thereafter, the Board tentatively decided to give alternative houses or refund the deposits to the allottees without interest as per the Karnataka Housing Board Rules and Regulations. As already noticed above the allotment of new house (ground plus two floor tenements) in lieu of the house already allotted was to be made to the allottee who agreed to bear the difference in the cost.

( 4 ) IT appears that instead of giving his option to the Board, the complainant filed complaint before the State Commission for the relief mentioned above. The State Commission held that the opposite party had collected huge funds of money from the complainant and after lapse of nearly two years the construction was found not upto the mark and the option given to the allottee to take refund of the money deposited without interest was clearly unreasonable and it is a clear case of deficiency in service. The State Commission directed the opposite party to refund the sum of Rs. 1,66,000/- with interest at 18% from the respective date of deposits upto the date of payment. The complainant was not granted any compensation for mental agony, loss etc.

( 5 ) AS noticed above the complainant has filed First Appeal No. 203/93 while the opposite party has filed First Appeal No. 342/93. The complainant in his appeal has prayed for compensation loss and damages for mental agony. According to the complainant, he was staying in rented house and had paid Rs. 600/- per month as rent for a period of four years i. e. from March, 1989 to March, 1992 and also obtained loan of Rs. 1,23,000/- from H. D. F. C. at 14% interest and another sum of Rs. 43,000/- from outside agencies at 24% interest per annum.

( 6 ) THE case of the appellant in Appeal No. 342/93 is that no interest can be allowed on the deposits made by the allottee. It is also pleaded that transaction in question is a contractual obligation and enforcement of such contract or otherwise cannot be entertained by consumer forums constituted under Consumer Protection Act, 1986.

( 7 ) BEFORE proceeding further we may mention here that Appeal No. 203 has been filed after a delay of 13 days while Appeal No. 342/93 has been filed with 8 days delay. In both the cases application for condonation of delay has been filed. Considering the grounds mentioned in these applications and also taking into consideration that delay is of only a few days we condone the delay in both the appeals.

( 8 ) FIRST we take up F. A. No. 342/93 filed by the opposite party. The contention of the appellant in that appeal is that for a constituted under the Consumer Protection Act have no jurisdiction to dispose of such complaints and have to be rejected outrightly. However, this Commission held in (U. P. Avas Evam Vikas Pradhikaran v. Garima Shukla and others) that where the Housing and Development Boards are engaged in serving the public in the matter of providing houses, acquisition of land, development of sites, construction of houses thereon and allotment of plots/houses to the public for consideration are rendering service to the public. This view has been upheld by the Supreme Court in Civil Appeal No. 6237 of 1990 titled (Lucknow Development Authority v. M. K. Gupta) by that order the Supreme Court disposed of some other similar Appeals. Hence, the above objection of the opposite party is overruled.

( 9 ) THE other ground taken in that appeal is that under the Karnataka Housing Board Rules and Regulations allottees are not entitled to interest on deposits. As noticed earlier, the State Commission has held that the opposite party is guilty of deficiency in service as huge sums of money has been collected from the complainant and after lapse of nearly two years, he was informed that the construction of the house was not upto the mark and advised the complainant to take refund of the money deposited without interest or to opt for an alternative flat and agree to pay the difference in the price. The Boards stand is totally unreasonable. Before taking up the construction of the superstructure of the houses with soil stabilised mud blocks the Board ought to have seen whether such houses could withstand the heavy rains. When the Board found that the houses are not upto the mark it offered to the allottee to opt for an alternative house at the increased price or to take refund without interest. The said offer was not in any way a reasonable concession granted to the allottee. A person who has deposited huge sums cannot be asked to take back the refund after two years without interest or to opt for alternative house at increased price which might be beyond his financial capacity. Thus we uphold the finding of the State Commission that the Board has been gross negligent in rendering service and that it was justified in awarding interest to the complainant who had borrowed money from H. D. F. C. and other agencies on interest for depositing with the Board in the hope that habitable house would be allotted to him after a reasonable time. Hence First Appeal No. 342/93 is liable to be dismissed.

( 10 ) NOW we take up First Appeal No. 203/93. The complaint was filed by the complainant in 1992. Upto that time the amount deposited with the Board, was not refunded to him. The argument that the complainant had not given his option asked for vide letter dated 21st March, 1992 has no force. If the complainant has not given his option for the alternative house, the amount ought to have been refunded to him. During all these years the complainant must have suffered mental agony as huge amount borrowed by him from different agencies was lying blocked with the Board and he was not getting any benefit from the deposits. It is common knowledge that the prices of real estate are rising day by day. The complainant cannot now get a house at the amount deposited by him. Considering all these facts we think that the complainant is entitled to some compensation in respect of the various items pleaded in the complaint. We assess the compensation at Rs. 25,000/ -.

( 11 ) FOR the reasons given above First Appeal No. 342/94 is dismissed with costs which we assess at Rs. 1,000/ -. First Appeal No. 203/93 is partly allowed. While maintaining the order of the State Commission we further direct that the opposite party will pay Rs. 25,000/- to the complainant within two months from the date of receipt of the order failing which the said amount will also carry interest at the rate of 18% per annum from the date of this order till realisation. In First Appeal No. 203/93 we leave the parties to bear their own costs. Order accordingly.

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Mr. Justice S.S. Chadha, Member

This Revision Petition has arisen out of the order dated 30.9.93 of the State Commission, Tamil Nadu at Madras disposing of two appeals against the order dated 16.12.92 of the District Forum, Tirunelveli and confirming the award of compensation of Rs. 2,000/- and costs of Rs. 200/-against the Chairman, Board of Examinations, Department of Technical Education, petitioner herein.

2. The complainant alleged that he studied during 1986-89 for getting Diploma in Electrical Engineering, that he appeared but did not pass III semester examination, that he applied to write the examination in October, 1991 and that he was issued the hall ticket bearing 23244, According to the complainant, he went to the examination hall with his hall ticket on 22.10.91 and took his seat, that the examination supervisor told the complainant that the subject Code No. of the subject was wrong, that the complainant approached the Chief Supervisor, that the hall supervisor was asked by Chief Supervisor, to proceed with the list, that the hall supervisor after perusing the list told the complainant that against the name of the complainant only Code No. 2 was cited but the Code No. of the subject Production Technology which the complainant wished to write is Code No. 1 and that all the persons in charge of conducting examination refused to permit the complainant to write the examination on 22.10.91. The complainant alleged that he was wrongly restrained and prevented from writing the examination on production Technology because of the attitude and negligence of the opposite parties and thus there is a clear case of deficiency in service of the persons engaged by the Petitioner herein. The other parties were sought to be made vicariously liable for the negligence. The complainant claimed a compensation of Rs. 25,000/-.

3. According to the opposite parties when the complainant came to the examination hall on 22.10.91 he informed the invigilator that he wanted to write paper No. 1, Code No. 1, on that day without mentioning the name of the Subject or the correct Code No., that on the said date the examination was held for the subject Production Technology with Code No. 2, that the examination with Code No. 1 was scheduled for 23.10.91 and that the complainant tampered with the entries in the Hall Ticket.

4. Before the District Forum the complainant led oral and documentary evidence and the opposite parties filed affidavits along with documents. On the appreciation of the evidence, it was held that the hall ticket, Exhibit Al, shows that the complainant was appearing for III Semester Examination paper bearing Code Nos. 2 and 3, that on 22.10.91 there was examination in III Semester Production Technology-1 bearing Code No. 2, that the complainant was prevented from writing the examination due to confusion and gross negligence of the invigilator and that it amounts to gross deficiency in service. The District Forum granted a compensation of Rs. 2,000/- and costs of Rs. 200/- against all the opposite parties.

5. The opposite parties filed two separate appeals before the State Commission. The State Commission evaluated afresh the evidence on the record and affirmed the finding of the District Forum. It was held that there was gross deficiency of service on the part of the Invigilator for which the employer, the first opposite party, is vicariously liable. The State Commission then adverted to the contention of the appellants before it that the examinations conducted by the appellants are not services rendered for consideration within the meaning of Section 2(l)(o) of the Consumer Protection Act, 1986 and the complainant is not, therefore, a consumer within the meaning of Section 2(l)(d)(ii) of the Act. The attention of the State Commission was invited to the order of this Commission dated 18th March, 1993, In “Director of Technical Education v. A. Siraj Basha, R.P. No. 372 of 1992; decided on 18.3.93 (NC), wherein it was held that there was no arrangement of service for consideration as between the complainant who was a candidate for an examination and the Director of Technical Education whose department conducted the examination and therefore, the complainant cannot be regarded as a consumer. The State Commission after referring to some decided cases observed :

”While rendering the decision in Director of Technical Education, Madras & Another v. A Siraj Basha (supra) the attention of the National Commission does not seem to have been need to the decisions discussed above, particularly to the decision of the National Commission itself in Manisha Samal v. Sambalpur University & Ors., 1 (1992) CPJ 231 NC, and the decision of the Supreme Court in The Bangalore Water Supply and Sewerage Board Etc. v. A. Rajappa and Others, 1978 SC 481 which lays down the law of the land. Hence the judgment of the National Commission in the Director of Technical Education, Madras & Anr. v. A Siraj Basha (supra) in per-incuriam and does not have the sway of binding precedent, as pointed out by the Supreme Court in Mamleshwar Prasad and Another v. Kanahiya Lal, 1975 (SC) 653.

6. The State Commission then held in the impugned order that Education imparted by the Government, Universities and private institutions and the examination conducted by the Government or Universities are services rendered for consideration and the student who avails of these services is a consumer within the meaning of Section 2(l)(d)(ii) of the Act.

7. It is necessary first to recall the Doctrine of Stare Decises. The binding character of judicial decisions may flow either from a constitutional provision or from a statutory provision or from the conventions which the Courts observe in the administration of justice. Constitutional sanction is given to the binding nature of the judgments of the Supreme Court by Article 141 of the Constitution. A declaration of law by the Supreme Court has a binding effect on all Courts in India. The law initiated by the Supreme Court is binding and absolute. Its correctness cannot be doubted. Rules framed by several High Courts in the country require that Judges must follow the decisions of that Court and when a Judge or Division Bench does not agree with another Bench, he or it should have a reference made to the Full Bench or place the papers before the Chief Justice for constituting a larger Bench to resolve the conflict. Subordinate Courts must follow the decision of the High Courts to which they are judicially subordinate, whatever their own views may be. This is a principle based on judicial comity and requires Judges to follow precedents of Courts of Co-ordinate jurisdiction and of superior jurisdiction. In legal matters some degree of certainty is as valuable as part of justice as perfection. One reason for consistency is that people often regulate their conduct with reference to existing rules, which make it important for Judges to abide by them. Innovations can not be unsettling and lead to a loss of confidence. (Dias Jurisprudence). The Supreme Court has spoken on Stare Decises in several cases. In Krishan Kumar v. Union of India, (1990) 4 SCC 207, it was ruled :

“Stare decises at non quieta movere. To adhere to precedent and not to unsettle things which are settled. But it applies to litigated facts and necessarily decided questions. Apart from Article 14 of the Constitution of India, the policy of Courts is to stand by precedent and not to disturb settled point. When Court has once laid down a principle of law as applicable to certain state of facts, it will adhere to that principle, and apply it to all future cases where facts are substantially the same. A deliberate and solemn decision of Court made after argument on question of law fairly arising in the case, and necessary to its determination, is an authority, or binding precedent in the same Court, or in other Courts of equal or lower rank in subsequent cases where the point is again in controversy unless there are occasions when departure is rendered necessary to vindicate plain, obvious principles of law and remedy continued injustice. It should be invariably applied and should not ordinarily be departed from where decisions of long standing and rights have been acquired under it, unless consideration of public policy demand it.”

8. The same principles apply to quasi-judicial Tribunals where there is a hierarchy of Tribunals. Each Tribunal must follow its own earlier decisions and the decisions of the Superior Tribunals to which they are subordinate. A decision of a Tribunal is binding not because of its conclusions but in regard to its ratio and the principles laid down therein.

This Commission has taken the view that the Consumer Disputes Redressal Forums are quasi judicial authorities and are thus governed by the well-established principles of the binding nature of its own earlier decisions. The State Commissions and the District Forums are subordinate to this Commission and are bound to follow the decisions of the superior forums. It is sufficient for invoking rule of Stare Decises that a certain decision was arrived at on a question irrespective of the grounds or reasons of its decision. The doctrine of precedent depends on uniformity in the decision on a question of law. That doctrine is not concerned with concrete issues of facts between the parties. Its effect is to declare law not the facts and to declare it so as to be binding upon all consumers or opposite parties as well as all Fora of inferior jurisdiction and in case of same jurisdiction. Were it to be otherwise, the situation in the well ordered field of a legal system governed by precedent would be rendered chaotic.

9. The State Commissions in several cases have noticed and applied the rule of precedent. The State Commission, Haryana in “S.D.O.A.E.E. City Division, Hisar v. M/s. Hotel Palki, Hisar”, I (1992) CPJ 127 and again in M/s. Wheel World of Ambala Cantt. v. S.P. Verma, 1992 (2) CPR 653. held that the State Commission is bound by its own earlier decisions on pure questions of law. In “Pawan Katial & Ors. v. Ansal Housing and Construction Ltd. 1993 (2) CPR 242=II (1992) CPJ 838. the State Commission, Haryana held that it is well settled on the larger theory of precedent that a judgment of a Court holds the field and is binding on the Court’s below till it is expressly reversed or over-ruled by larger Bench or a superior Court and the mere filing of an appeal or the admission of a Special Leave Petition by their Lordship of the Supreme Court does not ipso facto obliterate its reasoning, at the ratio thereof. In “Vijay Kumar Joshi & Ors. v. Chief Executive Officer-cum-Chief Engineer, Shimla Development Authority, 1994 (1) CPR 188=III (1993) CPJ 1662. the State Commission, Shimla came to the conclusion that the State Commission considers themselves bound by their own decision on pure questions of law.

10. A word about decision per incuriam. A decision is given per incuriam, when the Tribunal has acted in ignorance of a previous decision of its own or of any Tribunal of co-ordinate jurisdiction which covers the case before it or when it acted in ignorance of a decision of the superior Court and if it is a decision given per incuriam ignoring by inadvertence a decision of Supreme Court on the point it is obvious that the decision cannot be a binding precedent as the view taken by the Supreme Court on a question of law binds all Courts and Tribunals under Article 141 of the Constitution. But it must be remembered that it does not belong to the State Commissions or District Forums to disregard a decision of the National Commission by applying to it a label of per incuriam.

11. Section 2(d) of the Act defines “consumer” as meaning any person who (i) buys any goods for consideration etc.; and (ii) hires or avails of any services 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 services 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. Hiring any services for consideration is thus one of the essential preconditions before a person can be considered to be a consumer within the meaning of the Act. The word ?hire’ means to acquire the temporary use of a thing or the services of a person in exchange for payment, to engage the temporary use for a fixed sum, to procure the use of services of, at a price, to grant temporary use of for compensation. This is the ordinary, plain, grammatical meaning of the expression and has been so expressed by this Commission in several cases. The Consumer must be one who has hired services for consideration and to be a consumer the nexus of hiring of services for consideration must be established. The definition of Service, is contained in Section 2(l)(o) of the Act:

“Service means service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance transport, processing, supply of electrical or other energy, board or lodging or both, (housing construction) entertainment, amusement or the purveying news or other information, but does not include the rendering of any service free of charge or under a contract of personal service”.

12. The question whether a candidate of examination in the University of Rajasthan is a consumer intended to be covered under the provisions of the Act came up for consideration before the Rajasthan State Commission in “Kumari Seema Bhatia v. Registrar, Rajasthan University, II (1992) CPJ 899, Mr. Justice S.K.M. Lodha, President of the State Commission with the concurrence of other members referred to in detail to the establishment of the University of Rajasthan under the University of Rajasthan Act, 1946 and to the various provisions of statutes and ordinances for conducting the examinations and the detailed procedure for evaluation and re-evaluation of the answer books. It came to the conclusion that examination, evaluation of answer books, declaration of results and re-evaluation of answer books do not Constitute service within the meaning of Section 2(l)(o) of the Act. Payment of the re-evaluation of answer books does not mean that the candidate has hired the service of the opposite party. Reliance was placed by the State Commission on the decision of this Commission in ”Society for Civic Rights v. Union of India & Ors. I (1991) CPJ 199 (N.C) that consumer must be one who has hired the services for consideration and to be a consumer the nexus of hiring of service must be established. So payment of the examination fee by the candidate for re-evaluation of the answer books to the University does not mean that the candidate has hired the services of the opposite party. Hire means payment by contract for the use of thing or for personal service, the engagement on these terms. The complaint in that case was dismissed on this limited ground. This is the earliest decision on the question to which we have come across. An appeal was filed before this Commission against the said order dated 28.10.91 passed by the State Commission Rajasthan, being F.A. No. 133 of 1992 and disposed of by the Order dated 12.4.93 reading as follows :

“The appellant is not present either in person or through authorised representative. We have gone through the records and heard the Counsel for the respondent. We are in complete agreement with the view expressed by the State Commission that in conducting the re-valuation of the answer papers of a candidate who has appeared for an examination held by the respondent. University, the respondent was not rendering any service as defined in the Act for consideration nor there was any arrangement of hiring of service for consideration as contemplated by the Act. Hence the approach made by the complainant to the State Commission seeking relief under the Consumer Protection Act was totally misconceived. The dismissal of the complaint petition by the State Commission on the said ground was absolutely correct. We confirm the order of the State Commission and dismiss this appeal. No costs.”

In a recent decision of the Supreme Court in “S.P. Goel v. Collector of Stamps, Delhi, Civil Appeal No. 11603 of 1995 (SC)=I (1996) CPJ 11 (SC). the question arose whether there is any hiring of service for consideration by a person who pays registration charges and presents a document for registration under the Registration Act, 1908 by payment of stamp duty on documents under the provisions of Indian Stamp Act, 1989. After analyzing the provisions of the Registration Act as well as the Stamp Duty Act the Supreme Court ruled that the person who presents document for registration and pays the stamp duty on it or the registration fee, does not become consumer nor do the officers appointed to implement the provisions of the two acts render any service within the meaning of Consumer Protection Act.

The State Commission, Haryana in “Tilak Raj of Chandigarh v. Haryana School Education Board, Bhiwani, I (1992) CPJ 76 (Haryana), had taken a different view by holding that imparting of Education by the State is not one of its sovereign^ regal functions and is a service. The State Commission held that imparting of education by the State clearly comes within the concept of service under Clause (o) Sub-section (1) Section 2 of the Act and inevitably the conduct of the Matriculation and Primary examinations by the School Board for a prescribed fee is a ?service.? The State Commission upheld on 14.8.92 a similar view in “A.PJ. School v. K.L. Galhotra, II (1992) CPJ 807, Both these rulings were given by the Haryana State Commission prior to the decision of this Commission in F.A, No. 133 of 1992.

The question again came up for consideration before this Commission in “Joint Secretary, Gujarat Secondary Education Board v. Bharat Narottam Thakkar, I (1994) CPJ 187. When it was reiterated that in conducting the Secondary School Board Examinations, evaluating answer papers announcing the results thereof and thereafter conducting a re-checking of the marks of any candidate on application made by the concerned candidate, the Board is not performing any service for hire and there is no arrangement of hiring of service involved in such a situation as is contemplated by Section 2(l)(o) of the Act. The complainant in that case was not therefore a consumer and no relief should have been granted in his favour as against the Board of Secondary Education on the ground put forward by the candidate that there was delay in conducting the re-checking of the marks. The same view was reiterated in “Registrar, University of Bombay v. Mumbai Grahak Panchayat, Bombay, I (1994) CPJ 146. This view was followed by the Maharashtra State Commission in “Maharashtra State Board of Secondary Education v. Chairman, Grahak Jagruti Sangh, II (1994) CPJ 1, by Andhra Pradesh State Commission in the “Secretary, Board of Intermediate Education v. M. Suresh & Anr., II (1995) CPJ 167 (AP)” Kerala State Commission in “P.M. Noushand & Anr. v. University of Kerala & Ors., II (1995) CPJ 334 (Ker.) and by Delhi State Commission “Ruchika Bhartia v. C.B.S.E. & Anr., II (1995) CPJ 436 and in other cases.

The decision of this Commission in “Manisha Samal v. Sambalpur University, II (1992) CPJ 231 (NC), noticed in the impugned order cannot be regarded as an affirmance of the view taken by the Orissa State Commission in the order under appeal that the appellant there had hired the services of the University on payment of fees for appearing at the examination, but no relief was granted. When that appeal came up for hearing before this Commission, it was found on facts that the apprehension of the complainant that the marks she secured in her examination paper had been awarded to other two students who had been assigned the identical roll number in the examination and vice-versa is not true, as the other two students with the same Roll Numbers did not appear in the examination. The complaint was dismissed and there is a specific note that “it is unnecessary for us to go into other points raised,’. A decision is only an authority for what it actually decides on a question of law, not for what it implies or assumes or narrates. This Commission felt it unnecessary to go into other questions and this could not be construed as a tacit affirmance of the correctness of the view taken by the Orissa State Commission. Education does not find mention in express terms like other activities which have been specifically enumerated, but being inclusive definition the net is very wide. But the Supreme Court has not ruled that whenever Education is imparted for consideration there exists a quid pro quo for the provision of Education and monetary recompense, therefore, and included in the definition of service.

13. We must make it clear that in this case or in the earlier cases this Commission did not consider the general question whether the imparting of education for consideration would come or not within the ambit of the service under the Act. Whether a University or an institution affiliated to it imparting education is within the arena of consumer jurisdiction is a question which this Commission will consider and decide when it directly arises before it. What this Commission has decided in earlier casts is that a University or the Board in conducting public examination, evaluating answer papers, announcing the results thereof and thereafter conducting re-checking of the marks of any candidate on the application made by the concerned candidate is not performing any service for hire and there is no arrangement of hiring of any service involved in such a situation as contemplated by Section 2(l)(o) of the Act. A candidate who appears for the examination cannot be regarded as a person who had hired or availed of the services of the University or Board for consideration.

14. The impugned orders suffer from serious illegalities in the exercise of jurisdiction and are entitled to be set aside. The Revision Petition is accepted and the impugned orders dated 30.9.93 of the State Commission, Tamil Nadu and the orders dated 16.12.92 of the District Forum are hereby set aside and the complaint dismissed leaving the parties to bear their own costs throughout.

(Minority View)

Dr. (Mrs.) R. Thamarajakshi, Member.

15. Revision Petition No. 545 of 1994 has been filed by the Chairman, Board of Examinations, Department of Technical Education, Madras against the order dated 13th December, 1993 passed by the State Consumer Disputes Redressal Commission, Tamil Nadu in Appeal No. 23/93 wherein the Revision Petitioner herein had appealed against the order dated 10th December, 1992 of the Tirunelveli Kattabomman District Consumer Disputes Redressal Forum. Tamil Nadu. The respondent complainant before the State Commission is the respondent before us, while Chairman, Board of Examination, Department of Technical Education, Madras, Principal, S.A. Raja’s Polytechnic, Vadakkankulam and Correspondent, S.A. Raja’s Polytechnic, Vadakkankulam were respectively opposite party No. 1, opposite party No. 2 and opposite party No. 3 before the District Forum.

16. The facts of the case, as available from the records, are briefly as follows : When the complainant, a student of the Diploma course in Electrical Engineering in S.A. Raja’s Polytechnic went to the examination hall on 22nd October, 1991 to write his III Semester Examination in Production Technology-I, the Hall Supervisor told that the Code Number of that examination paper was 1 while the complainant’s shall ticket gave the number as 2 and that he was not eligible to write the examination. He could not, therefor, write the examination. On subsequent verification, however it was found that the Code Number for that paper was only 2 and it had been correctly entered in the hall ticket. It was the complainant’s case that the Invigilator had committed the mistake and the opposite parties were vicariously liable for the negligence; he claimed Rs. 25,000/- as compensation for the same. The contention of the opposite party was as follows:

The complainant was in a confused state of mind in regard to the subject code. Due to this confusion, he had tampered with the hall ticket and he was asked to get the initials of the Chief Superintendent who after warning him made necessary corrections and put his initials. However, when the complainant went to the examination hall, he told the Invigilator that he was going to write paper with Code No. 1 instead of paper with Code No. 2 and the Invigilator told him that there was no examination for paper with Code No. 2 on that day. The case of the opposite parties was that the mistake was due to the confusion on the part of the complainant and that, therefore, there was no deficiency of service and negligence on the part of the Invigilator. On the basis of oral and documentary evidence produced by the complainant and affidavits filed by the opposite parties, the District Forum found that there was deficiency of service and negligence on the part of the Invigilator in refusing to allow the complainant to write the examination on 22nd October, 1991 and granted compensation of Rs. 2,000/- and costs of Rs. 200/- against the opposite parties.

17. Separate appeals against this order of the District Forum were filed before the State Commission by opposite party No. 1 (AP 23/93) and opposite party Nos. 2 & 3 (XP. 52/93). On an examination of the case, the State Commission observed that as far as the corrections / tampering in the hall ticket were concerned, the Chief Superintendent had made the necessary corrections and initialled the same and hence nothing turned upon the corrections made thereon. The State Commission further held that whereas the complainant had examined himself as PW1 and another student who took the examination on that day as PW 2 to show that it was the Invigilator who told the complainant that the examination was paper with Code No. 1 and did not allow the complainant to write his examination because his hall ticket mentioned Code No. 2, the opposite party No. 1 had not chosen to examine the particular Invigilator to substantiate the contention that it was the complainant who was in a state of confusion regarding the code number nor had filed any affidavit from the Invigilator. The State Commission thus concluded that the testimony of PW1 and PW2 that it was the Invigilator who informed the complainant that the examination on that day was for paper bearing Code No. 1 and sent put the complainant stands unrebutted. The State Commission, therefore, confirmed the findings of the District Forum but held that the opposite parties 2 & 3 had absolutely nothing to do with the conducting of examination except placing the college premises at the disposal of the opposite party No. 1 for the conduct of examination and hence were not liable for the negligence on the part of Invigilator who was appointed by the opposite party No. 1. In the result, the State Commission held that there was gross deficiency on the part of opposite party No. 1 and confirmed the award of compensation of Rs. 2,000/- and costs of Rs. 200/- against the opposite party No. 1. While doing so, the State Commission considered in depth the larger issue of whether education is a service maintainable under the Consumer Protection Act, and answered the same in the affirmative.

18. In the Revision Petition before us also, the main contention are: (i) whether a candidate appearing at an examination could be said to hire the services of the examining body for holding an examination; (ii) whether holding an examination in discharge of statutory functions could be said to be rendering service for consideration; and (iii) whether matters relating to the holding of an examination are within the purview of the Consumer Redressal Forum.

19. In my view, these are specific issues and are integral components of the basic issue of whether imparting of education per se is within the purview of Consumer Protection Act; the specific issues and the basic issue are inseparable and, therefore, cannot be delinked. To be able to satisfactorily handle the aforesaid specific contentions in the Revision Petition, the basic issue whether imparting of education is covered under the Act, as a service has to be first dealt with. It is, therefore, proposed to consider the issues in an integrated way.

20. Education is imparted through schools, colleges, institutions and universities, and the educational institution may be private, Government or autonomous bodies. Imparting of education is a composite activity consisting of several components, namely admission to these institutions, teaching and instruction, conducting of examination, evaluation of performance of students in the courses they have under gone, issuance of certificates and diplomas of achievement and mark-sheets etc. Which require payment of prescribed fees (consideration) by the students /candidates to the educational authorities unless specified as “free/,

21. To examine whether imparting of education is a service under the Act, the definitions of “Consumer”, “Service” and “Deficiency” therein are relevant.

Section 2(1)(d) of the Act defines Consumer as meaning :

“(i) any person who buys any goods for a consideration etc; or

(ii) hires or avails of any services 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 services 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;”

Section 2(l)(o) of the Act, defines “Service” as meaning :

“Service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service.”

Section 2(l)(g) of the Act, defines ‘deficiency’ as meaning:

“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”.

The above definitions of “consumer”, “Service,, and “Deficiency” are seen to be intended to have wide scope of interpretation. The words “any services for a consideration” in the definition of “Consumer” points to the generally non-restrictive nature of the definition in relation to service. The scope of definition of service in the Act has been discussed in extensor by the Supreme Court in Lucknow Development Authority v. M.K. Gupta, 1986-95 Consumer 278 (NS)=III (1993) CPJ 7 (SC). and more recently in Indian Medical Association v. V.P. Shantha & Ors., 1986-95 (Supp. I) Consumer 1569 (NS)=III (1995) CPJ 1 (SC). After pointing out that the definition of ?service? in the Consumer Protection Act, is in three parts, the Supreme Court has observed in the former case :

“The main part is followed by inclusive clause and ends by exclusionary clause. The main clause itself is very wide. It applies to any service made available to potential users. The words ?any? and potential, are significant. Both are of wide amplitude. The word ?any’ dictionarily means “one or some or all”. In Black’s Law Dictionary it is explained this, word ?any’ has a diversity of meaning and may be employed to indicate all, or ?every? as well as ‘some’ or ?one’ and its meaning in a given statute depends upon the context and the subject matter of the statute. “The use of the word ‘any, in the context it has been used in Clause (o) indicates that it has been used in wider sense extending from one to all”.

Referring to the inclusive part of the definition, the Supreme Court in the above said case observed:

“The inclusive clause succeeded in widening its scope but not exhausting the services which could be covered in earlier part. So any service except when it is free of charge or under a contract of personal service is included in it”.

The Supreme Court also made observations in the same case on the larger issue whether the public authorities under different enactments are amenable to jurisdiction under the Act. Referring to the arguments placed before them in that case that the local authorities or Government bodies develop land and construct houses in the discharge of their statutory functions and that therefore, they could not be subjected to the provisions of Act, the Court observed :

“In fact the act, requires the provider of service to be more objective and care taking. It is still more in public services.

They further observed :

“Any attempt, therefore, to exclude services offered by statutory or official bodies to the common man would be against the provisions of the Act, and the spirit behind it.,.

The words “avails of, in Section 2(l)(d)(ii) as alternative to “hires” in the same section as also the words “has been undertaken to be performed in pursuance of a contract or otherwise in relation to any service” in Section 2(l)(g) have the effect of bringing under the purview of the consumer forum, services rendered by bodies like Universities which are established for rendering specified services and which services are availed of for a consideration, even in the absence of any arrangement or contract to hire such services.

22. I would also like to discuss the question of the Doctrine of Stare Decises vis-a-vis the instant case. The Doctrine of Stare Decises is defined in Black’s Law Dictionary as follows :

“To abide by, or adhere to decided cases. Policy of Courts to stand by precedent and riot to disturb settled point. Neff v. George, 364 III 306,4 N.E.: 2d 388,390,391. Doctrine that, when Court has once laid down a principle of law as applicable to certain state of facts, it will adhere to that principle, and apply it to all future cases, where facts are substantially the same; regardless of whether the parties and property are the same. Home V Moody, Tax. Civ. App. 146 S.W. 2d 505,509 and 510. Under doctrine a deliberate or solemn decision of Court made after argument on question of law fairly arising in the case, and necessary to its determination, is an authority, or binding precedent in the same Court, or in other Courts of equal or lower rank in subsequent cases where the very point is again in controversy. State v. Mallenberger, 163 or 233, 95 P2d, 709, 719, 720. Doctrine is one of policy, grounded on theory that security and certainty require that accepted and established legal principle, under which rights may accrue, be recognized and followed though later found to be not legally sound, but whether previous holding of Court shall be adhered to, modified or over-ruled is within Court’s discretion under circumstances of one before it. Ottar ail Power Co. v. Von Bank, 72N. D 497, 8N.W.2d 599, 607. Under doctrine when point of law has been settled by decision, it forms precedent which is not afterwards departed from, and, while it should ordinarily be strictly adhered to, there are occasions when departure is rendered necessary to vindicate plain, obvious principles of law and remedy continued injuries. The doctrine is not ordinarily departed from where decision is of longstanding and rights have been acquired under it, unless considerations of public policy demand it. Colonial Trust Co. v. Flanagan 344 Pa. 556,25A, 2d, 728,729. The doctrine is limited to actual determination in respect of litigated and necessarily decided questions and is not applicable to dicta or Obiter dicta”, (Black’s Law Dictionary, Sixth Edition, Centennial Edition 1891-1991 Page 1406).

23. The doctrine applies in regard to decided cases. In so far as the National Commission has not decided on the basic question of whether education is a service under the purview of the CPA (from which question the specific questions in the Revision Petition arise), the doctrine is not applicable to the case on hand. A careful reading of the above definition of the doctrine shows that flexibility is given to the adjudicating bodies in dealing with different cases. This is clear from the following relevant extracts from the definition; i.e. “whether previous holding of Court shall be adhered to, modified, or overruled is within Court’s discretion under circumstances of case before it,’. “While it should ordinarily be strictly adhered to, there are occasions when departure is rendered necessary to vindicate plain, obvious principles of law and remedy continued injustice”.

24. It may be mentioned that in the recent decision of Supreme Court in Civil Appeal No. 11603/95 S.P. Goel v. Collector of Stamps, Delhi, (supra) the Supreme Court has specifically considered the scope, object and purpose of the Registration Act, 1908 and the Indian Stamps Act, 1899 vis-a-vis the Consumer Protection Act and have held that the former two Acts deal with State Revenue and pointed out that:. 1st

“The Registration Act as also the Stamp Act are meant primarily to augment the State revenue by prescribing the stamp duty on various categories of instruments or documents and the procedure for collection of stamp duty through distress or other means including criminal prosecution as non-payment of stamp duty has been constituted as an offence. Payment of registration fee or registration charges including charges for issuing certified copies of the registered documents or fee for the inspection of various registers or documents kept in the Registrars or sub-Registrars office etc. constitute another component of State revenue.

It this situation, therefore, the person who presents a documents for registration and pays the stamp duty on it or the registration fee, does not become a consumer nor do the officers appointed to implement the provisions of the two Acts render any service within the meaning of Consumer Protection Act. They only perform their statutory duties (some of which, as earlier indicated, are judicial or, at least, quasi-judicial in nature) to raise and collect the State revenue which is a part of the sovereign power of the State.”

The Supreme Court has further observed as under:

“We have already indicated above that under the Registration Act, as also under the Stamp Act, the officers, apart from performing administrative duties, also, at times, perform quasi-judicial functions. The Courts are also involved at some stage in the matter of determination of stamp duty. The Court and the officers are thus component of one and the same set up under these Acts. The Presiding Officers of the Courts are protected under the Judicial Officers (Protection) Act, 1850, read with the Judges (Protection) Act, 1985. But, so far as the officers are concerned the position is a little different.”

Since ‘Collector, has been specifically mentioned along with judges, Magistrates and Justices of Peace in the Judicial Officers (Protection) Act, 1850, it is obvious that immunity from legal action contemplated by this Act, will also be available to him.

25. From the aforesaid, it is obvious that since the fee collected in respect of educational institutions is not in the nature of State revenue and the officers of these institutions cannot, therefore, be equated to the Collector/Registrar under the respective Acts, the decision of the Supreme Court in S.P. Goel v. Collector of Stamps, Delhi. (Supra) is not applicable to the matter on hand.

26. The Consumer Protection Act, (1986) is an important social welfare legislation aiming to provide for the better protection of the interests of consumers, consumer legislation in India is in an evolutionary stage and it is only in November, 1995 that the Supreme Court has said the final word on the applicability of the Act to consumers of medical services. A positive approach is needed in interpreting the provisions of the Act, to capture to a maximum extent the spirit underlying the enactment to render natural justice to consumers and also to make those rendering these services accountable.

27. In the light of the aforesaid discussion, the answer to the basic question whether imparting of education is a service under the purview of the Act, is in the affirmative and therefore the answers to the specific issues in the Revision Petition which are operational aspects of the basic question?are also in the affirmative. It has been seen above that this conclusion based on the integrated examination of the basic and specific issues does not upset the doctrine of Stares Decises. I am, therefore, of the opinion that the order of the State Commission, Tamil Nadu does not suffer from any error of jurisdiction or material irregularity and that it does not call for any interference in the hands of this Commission Revision Petition is accordingly dismissed. No costs.

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1. AMBRISH KUMAR SHUKLA & 21 ORS.
H. No. 412, 1st Floor, Sector -6, Bahadurgarh Jhajjar, Haryana – 124 507        ………..Complainant(s)
Versus
1. Ferrous Infrastructure Pvt. Ltd.
Seth Farms, Khasra No. 41,42,44,45, Mehrauli, Gurgaon Road, Ghitorni, New Delhi-110030      ………..opp.party(S)

BEFORE:
Hon’ble Mr. Justice D.K. Jain, President
Hon’ble Dr. B.C. Gupta, Member
Hon’ble Mr. Justice V.K. Jain, Member

For the Complainant :
Mr. Uttam Datt, Advocate
Mr. Tarun Sharma, Advocate

For the Opp.Party : Mr. K.V. Girish Chowdary, Advocate

Dated : 07 Oct 2016

ORDER

Justice V.K. Jain, Member

Vide order dated 24.05.2016, passed in CC No. 97 of 2016, the following issues relating to the interpretation of Section 12(1)(c) of the Consumer Protection Act were referred, by a two members Bench of this Commission, to a larger Bench for its decision:

(i) Whether a complaint under Section 12(1)(c) of the Consumer Protection Act filed on behalf of or for the benefit of only some of the numerous consumers having a common interest or a common grievance is maintainable or it must necessarily be filed on behalf of or for the benefit of all the consumers having a common interest or a common grievance against same person (s);

(ii) Whether a complaint under Section 12(1)(c) of the Consumer Protection Act is maintainable, before this Commission, where the value of the goods or services and compensation, if any, claimed in respect of none of the allottees / purchasers exceeds Rupees one crore.

(iii) Whether a complaint under Section 12(1)(c) of the Consumer Protection Act is maintainable before this Commission, where the value of the goods or services and the compensation claimed in respect of an individual allottee exceeds Rupees one crore in the case of one or more allottees but does not exceed Rupees one crore in respect of other allottees;

(iv) Whether a complaint under Section 12(1)(c) of the Consumer Protection Act is maintainable, in a case of allotment of several flats in a project / building, where the allotments / bookings / purchases are made on different dates and or the agreed cost of the flat and / or the area of the flat is not identical in all the bookings / allotments / purchases.

2. Vide order dated 11.08.2016, passed in First Appeal No. 166 of 2016, First Appeal No. 504 of 2016 and First Appeal No. 505 of 2016, the following issues were referred, by a single Member Bench of this Commission to the larger Bench:

(i) In a situation, where the possession of a housing unit has already been delivered to the complainants and may be, sale deeds etc. also executed, but some deficiencies are pointed out in the construction/ development of the property, whether the pecuniary jurisdiction is to be determined, taking the value of such property as a whole, OR the extent of deficiency alleged is to be considered for the purpose of determining such pecuniary jurisdiction.

(ii) Whether the interest claimed on such value by way of compensation or otherwise, is to be taken into account for determining the pecuniary jurisdiction of a particular consumer forum.

(iii) Whether “the value of the goods or services and compensation, if any, claimed” is to be taken as per the original value of such goods, or service at the time of purchase of such goods or hiring or availing of such service, OR such value is to be taken at the time of filing the claim, in question.

(iv) In complaints proposed to be filed under section 12(1)(c) of the Act with the permission of Consumer Forum, whether the pecuniary jurisdiction is to be determined taking the value of goods or service for individual consumer, OR the aggregate value of the properties of all consumers getting together to file the consumer complaint is to be taken into consideration.

(v) For filing the consumer complaints u/s 12(1)(c), whether a group of cooperative societies could join hands to file a joint complaint?

(vi) Whether the term ‘consumer’ given in section 12(1)(c) includes the term ‘Person’ as defined in section 2(m) of the Act, meaning thereby that groups of firms, societies, association, etc. could join hands to file the joint complaints, u/s 12(1)(c) of the Act.

(vii) Many a time, it is seen that more than one joint complaint are already pending in respect of one particular housing project. There is a view that while applying section 12(1)(c) of the Act, only one of these complaints should be allowed to continue as a lead case, and all other complaints should be dismissed and the parties in these dismissed complaints should be directed to become parties in the lead case. Whether the above view is correct, OR in such cases, all complaints should be clubbed and heard together.

3. In First Appeal No. 644 of 2015, the complainant booked an apartment with respondent no. 1. The allotment was cancelled by the respondent on account of non-payment of the balance sale consideration. Being aggrieved, the complainant approached the concerned District Forum by way of a complaint, seeking restoration of the flat with possession and compensation. The respondent contested the complaint and took a preliminary objection that the District Forum did not possess the requisite pecuniary jurisdiction to entertain the complaint. The District Forum vide its order dated 22.01.2013, noticing that the price of the apartment was Rs.46,02,653/-, held that the said Forum had no pecuniary jurisdiction to entertain the complaint. The appellant then approached the concerned State Commission by way of a fresh Consumer Complaint. The State Commission however, took the view that if the grievance pertains to a deficiency in service, the complainant has to assess the deficiency in the service availed by him and the value of the flat is not to be taken into consideration while deciding whether the said Commission had pecuniary jurisdiction to hear the complaint or not. Noticing that the complainant had claimed Rs.10,00,000/- as compensation, the complaint was dismissed. Being aggrieved, the complainant has approached this Commission by way of the aforesaid appeal.

Vide order dated 11.03.2016, passed in the aforesaid appeal, Bench No.1 of this Commission, noticing a divergence of opinion amongst various Benches of this Commission, on the issue of pecuniary jurisdiction, referred the said issue raised in the aforesaid appeal, to a larger Bench. The aforesaid issue however, is subsumed in issue no. 1 referred to the larger Bench in First Appeal No. 166 of 2016.

4. Section 12(1) of the Consumer Protection Act reads as under:

(1) A complaint in relation to any goods sold or delivered or agreed to be sold or delivered or any service provided or agreed to be provided may be filed with a District Forum by-

(a) the consumer to whom such goods are sold or delivered or agreed to be sold or delivered or such service provided or agreed to be provided;

(b) any recognized consumer association whether the consumer to whom the goods sold or delivered or agreed to be sold or delivered or service provided or agreed to be provided is a member of such association or not;

(c) one or more consumers, where there are numerous consumers having the same interest, with the permission of the District Forum, on behalf of, or for the benefit of, all consumers so interested; or

(d) the Central or the State Government, as the case may be, either in its individual capacity or as a representative of interests of the consumers in general.

5. Section 13(6) of the Consumer Protection Act reads as under:

(6) Where the complainant is a consumer referred to in sub-clause (iv) of clause (b) of sub-section (1) of section 2, the provisions of rule 8 of Order I of the First Schedule to the Code of Civil Procedure, 1908 (5 of 1908) shall apply subject to the modification that every reference therein to a suit or decree shall be construed as a reference to a complaint or the order of the District Forum thereon.

Section 2(1)(b) of the Consumer Protection Act reads as under:

(b) “complainant” means—

(i) a consumer; or

(ii) any voluntary consumer association registered under the Companies Act, 1956 (1 of 1956) or under any other law for the time being in force; or

(iii) the Central Government or any State Government; or

(iv) one or more consumers, where there are numerous consumers having the same interest;

(v) in case of death of a consumer, his legal heir or representative;] who or which makes a complaint;

6. Order I of Rule 8 of the Code of Civil Procedure which finds reference in Section 13(6) of the Consumer Protection Act, reads as under:

8. One person may sue or defend on behalf of all in same interest.- (1) Where there are numerous persons having the same interest in one suit,—

(a) one or more of such persons may, with the permission of the court, sue or be sued, or may defend such suit, on behalf of, or for the benefit of, all persons so interested;

(b) the court may direct that one or more of such persons may sue or be sued, or may defend such suit, on behalf of, or for the benefit of, all persons so interested.

(2) The court shall, in every case where a permission or direction is given under sub-rule (1), at the plaintiff’s expense, give notice of the institution of the suit to all persons so interested, either by personal service, or, where, by reason of the number of persons or any other cause, such service is not reasonably practicable, by public advertisement, as the court in each case may direct.

(3) Any person on whose behalf, or for whose benefit, a suit is instituted, or defended, under sub-rule (1), may apply to the court to be made a party to such suit.

(4) No part of the claim in any such suit shall be abandoned under sub-rule (1), and no such suit shall be withdrawn under sub-rule (3) of rule 1 of Order XXIII, and no agreement, compromise or satisfaction shall be recorded in any such suit under rule 3 of that Order, unless the court has given, at the plaintiff’s expenses notice to all persons so interested in the manner specified in sub-rule (2).

(5) Where any person suing or defending in any such suit does not proceed with due diligence in the suit or defence, the court may substitute in his place any other person having the same interest in the suit.

(6) A decree passed in a suit under this rule shall be binding on all persons on whose behalf, or for whose benefit, the suit is instituted, or defended, as the case may be.

7. Section 12(1) (c) of the Consumer Protection Act when read with Order I Rule 8 of the Code of the Civil Procedure will apply if (i) the consumers are numerous (ii) They have the same interest (iii) the necessary permission of the Consumer Forum is obtained and (iv) notice in terms of Sub-rule (2) of Rule 8 of Order I is given. It however, is not necessary that the cause of action available to all the consumers should also be the same. What is required is sameness of the interest and not the same cause of action.

8. The scope and object of the principle embodied in Rule 8 of Order I of Code of Civil Procedure was stated as under by a Four-Members Bench of this Commission in Anil Textorium Pvt. Ltd. Vs. Rajiv Niranjanbhai Mehta, III (1997) CPJ 31 (NC):

“6. …The principle admitted in all Courts / Tribunals/Quasi-Judicial Authorities upon questions affecting the suitor’s person and his liberty and his property is that the rights of no man shall be decided unless he himself is present. Therefore, all persons having an interest in the subject-matter are to be made parties in a suit or other proceedings but the provisions of Order I Rule 8 of the Code of Civil Procedure has carved out an exception. It provides that where a number of persons are similarly interested in a suit one or more of them can with the permission of the Court or on a direction given by the Court, sue or be sued on behalf of themselves and others. The provisions of this rule have been included in the Code in public interest to avoid multiplicity of litigation and to facilitate the decision on questions; in which a large number of persons are interested, without recourse to the ordinary procedure. These provisions are meant for the benefit and protection of the persons who have the same interest as one who has filed the suit. The exception is adopted by the Courts to avoid inconvenience, because if all persons interested are made parties, there would be considerable delay and justice would be hampered.

……It is the existence of a sufficient community of interest among the persons on whose behalf or against whom the suit is instituted that should be the governing factor in deciding as to whether the procedure provided in the representative suit should be adopted or not”.

8. The complainants can be one or more consumers, where there are numerous consumers having the same interest. The interest must be common to them all or they must have a common grievance which they seek to get redressed.

……Where all the consumers jointly interested are made parties to the complaint, it is not a representative complaint in the strict sense of the provisions of Order I Rule 8 and no permission is necessary”.

9. The obtaining of a quasi-judicial permission is an essential condition for binding those consumers other than those actually parities to the complaint. The Consumer FORA have to exercise a judicial discretion in granting permission to a complainant to sue in a representative capacity having regard to the nature of the complaint and the reliefs sought”.

9. In The Chairman, Tamil Nadu Housing Board, Madras Vs. T.N. Ganapathy, Civil Appeal No. 3002 of 1983 decided on 07.02.1990, a number of persons, including the respondent before the Hon’ble Supreme Court, were allotted residential plots by Tamil Nadu Housing Board at a tentative price. After more than ten years, fresh demands were made by the Board, threatening dispossession of the allottees in case of non-payment of the said demand. A suit was then filed by the respondent, who claimed to be representing all the allottees, on the ground that the cases of all of them were identical. The suit was contested, inter-alia on the ground that a suit in a representative capacity under Order 1 Rule 8 of the Code of Civil Procedure was not maintainable. The Trial Court and First Appellate Court upheld the maintainability of the suit but dismissed the same on merit. The High Court however, reversed the said decisions and decreed the suit. Being aggrieved, the Board approached the Hon’ble Supreme Court by way of a Special Leave Petition. On the maintainability of the Suit, it was contended on behalf of the appellant that since the injury complained was in respect of separate demand of money against each of the allottees, giving rise to different causes of action, the said provision was not applicable. It was emphasized that those, who had been served with the additional demand were interested in defeating only the demand individually referable to each of them. It was also contended that each one of the allottees was not interested in what happens to the others and therefore, the allottees should file separate suits. The contention however, did not find favour with the Hon’ble Supreme Court, which inter-alia observed and held as under:

“We do not find any merit in the argument. The provisions of Order 1 of Rule 8 have been included in the Code in the public interest so as to avoid multiplicity of litigation. The condition necessary for application of the provisions is that the persons on whose behalf the suit is being brought must have the same interest. In other words either the interest must be common or they must have a common grievance which they seek to get redressed. In Kodia Goundar vs. Velandi Goundar, ILR 1955 Mad. 339, a Full Bench of the Madras High Court observed that on the plain language of Order 1, Rule 8, the principal requirement to bring a suit within that Rule is the sameness of interest of the numerous person on whose behalf or for whose benefit the suit is instituted. The Court, while considering whether leave under the Rule should be granted or not, should examine whether there is sufficient community of interest to justify the adoption of the procedure provided under the Rule. The object for which this provision is enacted is really to facilitate the decision of questions, in which a large number of persons are interested, without recourse to the ordinary procedure. The provision must, therefore, receive an interpretation which will subserve the object for its enactment. There is no words in the Rule to limit its scope to any particular category of suits or to exclude a suit in regard to a claim for money or for injunction as the present one”.

“It is true that each of the allottees is interested individually in fighting out the demand separately made or going to be made on him and, thus, separate causes of action arise in the case, but, that does not make Order 1, Rule 8 inapplicable. Earlier there was some doubt about the Rule covering such a case which now stands clarified by the Explanation introduced by the CPC (Amendment) Act, 1976, which reads as follows:

Explanation – For the purpose of determining whether the persons who sue or are sued, or defend, have the same interest in one suit, it is not necessary to establish that such persons have the same cause of action as the persons on whose behalf, or for whose benefit, they sue or are sued, or defend the suit, as the case may be.

The objects and reasons for the amendment were stated below:

OBJECTS AND REASONS: Clause 55; Sub-Clause (iv), – Rule 8 of Order 1 deals with representative suits. Under this rule, where there are numerous persons having the same interest in one suit, one or more of them may, with permission of the Court, sue or be sued, on behalf of all of them. The rule has created a doubt as to whether the party representing others should have the same cause of action as the persons represented by him. The rule is being substituted by a new rule and an explanation is being added to clarify that such persons need not have the same cause of action.

There is, therefore, no doubt that the persons who may be represented in a suit under Order 1, Rule 8 need not have the same cause of action. The trial court in the present case was right in permitting the respondent to sue on behalf of all the allottees of Ashok Nagar”.

10. Since by virtue of Section 13(6) of the Consumer Protection Act, the provisions of the Order 1 Rule 8 of CPC apply to the consumer complaints filed by one or more consumers where there are numerous consumers having the same interest, the decision of the Hon’ble Supreme Court in Tamil Nadu Housing Board (supra) would squarely apply, while answering the reference. The purpose of giving a statutory recognition to such a complaint being to avoid the multiplicity of litigation, the effort should be to give an interpretation which would sub serve the said objective, by reducing the increasing inflow of the consumer complaints to the Consumer Forums. The reduction in the number of consumer complaints will be cost effective not only for the consumers but also for the service provider.

11. Reference dated 24.5.2016

Issue No. (i)

As held by the Hon’ble Supreme Court in Tamil Nadu Housing Board (supra), the interest of the persons on whose behalf the claim is brought must be common or they must have a common grievance which they seek to get addressed. The defect or deficiency in the goods purchased, or the services hired or availed of by them should be the same for all the consumers on whose behalf or for whose benefit the complaint is filed. Therefore, the oneness of the interest is akin to a common grievance against the same person. If, for instance, a number of flats or plots in a project are sold by a builder / developer to a number of persons, he fails to deliver possession of the said flats/plots within the time frame promised by him, and a complaint is filed by one or more such persons, either seeking delivery of possession of flats / plots purchased by them and other purchasers in the said project, or refund of the money paid by them and the other purchasers to the developer / builder is sought, the grievance of such persons being common i.e. the failure of the builder / developer to deliver timely possession of the flats/plots sold to them, they would have same interest in the subject matter of the complaint and sufficient community of interest to justify the adoption of the procedure prescribed in Order 1 Rule 8 of the Code of Civil Procedure, provided that the complaint is filed on behalf of or for the benefit of all the persons having a common grievance against the same developer / builder, and identical relief is sought for all such consumers.

The primary object behind permitting a class action such as a complaint under Section 12(1)(c) of the Consumer Protection Act being to facilitate the decision of a consumer dispute in which a large number of consumers are interested, without recourse to each of them filing an individual complaint, it is necessary that such a complaint is filed on behalf of or for the benefit of all the persons having such a community of interest. A complaint on behalf of only some of them therefore will not be maintainable. If for instance, 100 flat buyers / plot buyers in a project have a common grievance against the Builder / Developer and a complaint under Section 12(1)(c) of the Consumer Protection Act is filed on behalf of or for the benefit of say 10 of them, the primary purpose behind permitting a class action will not be achieved, since the remaining 90 aggrieved persons will be compelled either to file individual complaints or to file complaints on behalf of or for the benefit of the different group of purchasers in the same project. This, in our view, could not have been the Legislative intent. The term ‘persons so interested’ and ‘persons having the same interest’ used in Section 12(1)(c) mean, the persons having a common grievance against the same service provider. The use of the words “all consumers so interested’ and “on behalf of or for the benefit of all consumers so interested”, in Section 12(1)(c) leaves no doubt that such a complaint must necessarily be filed on behalf of or for the benefit of all the persons having a common grievance, seeking a common relief and consequently having a community of interest against the same service provider.

Sub rule (2) of Rule 8 of Order I of the Code of Civil Procedure mandates the Court to give notice of the institution of the suit /complaint to all the persons “so interested”, meaning thereby to the persons having the same interest, i.e. a common grievance, on whose behalf or for whose benefit the complaint is instituted. Notice can be either by way of personal service or where personal service is not reasonably practicable, by way of a public advertisement. The aforesaid provision clearly envisages institution of a suit / complaint on behalf or for the benefit of not only those who approach the Court/Forum but also on behalf of or for the benefit of the persons other than the plaintiffs / complainants, but having the same grievance. Had the Legislative intent been to permit such a complaint only on behalf of the persons deciding to approach the Court/ Forum, there could be no occasion for requiring the service of notice in the aforesaid manner, since there can be no question of serving any notice on those who are already before the Court/Forum.

Sub Rule (5) of Rule 8 of Order I enables the Court to substitute the name of any person having same interest in the suit as plaintiff where it finds that the person suing the suit is not proceeding with due diligence in the suit. The aforesaid power given to the Court also indicates that a suit in terms of order 1 Rule 8 of the Code of Civil Procedure commonly termed as a class suit is intended on behalf or for the benefit of all the persons having a common grievance against the same party and seeking the same relief not on behalf of or for the benefit of only some of them.

12. Issue No. (ii) and (iii)

Section 21 of the Consumer Protection Act, to the extent it is relevant provides that this Commission shall have jurisdiction to entertain complaints where the value of the goods or services and compensation, if any, claimed exceeds Rs.1.00 crore. Therefore, what has to be seen, for the purpose of determining the pecuniary jurisdiction, is the value of the goods or services and the amount of the compensation claimed in the complaint. If the aggregate of (i) the value of the goods or services and (ii) the compensation claimed in the complaint exceeds Rs.1.00 crore, this Commission would have pecuniary jurisdiction to entertain the complaint. Similarly, if the aggregate of the value of (i) the goods or services and (ii) compensation, if any, claimed in the complaint exceeds Rs.20.00 lacs but does not exceed Rs.1.00 Crore, the State Commission would have the pecuniary jurisdiction to entertain the complaint. Since a complaint under Section 12(1)(c) of the Consumer Protection Act can be filed only where there are numerous consumers having the same interest and it has to be filed on behalf of or for the benefit of all the consumers so interested i.e. all of the numerous consumers having the same interest, it is the aggregate of the value of the goods purchased or services hired or availed of, by all those numerous consumers and the total compensation, if any, claimed for all those numerous consumers, which would determine the pecuniary jurisdiction of this Commission. If the aggregate of the value of the goods purchased or the services hired or availed of by all the consumers having the same interest and the total compensation, if any, claimed for all of them comes to more than Rs.1.00 crore, the pecuniary jurisdiction would rest with this Commission alone. The value of the goods purchased or the services hired or availed of and the quantum of compensation, if any, claimed in respect of the one individual consumer therefore, would be absolutely irrelevant for the purpose of determining the pecuniary jurisdiction in such a complaint. In fact, this issue is no more res Integra in view of the decision of a Four-Members Bench of this Commission in Public Health Engineering Department Vs. Upbhokta Sanrakshan Samiti I (1992) CPJ 182 (NC). In the above referred case, a complaint was preferred, seeking to recover compensation for alleged negligence on the part of the petitioner which had resulted in a large number of persons getting infected by Jaundice. The names of 46 such persons were mentioned in the complaint but it was alleged that there were thousands of other sufferers who were similarly placed and that complaint was filed on behalf of all of them. The complainant had sought compensation of Rs.20,000/- for every student victim, Rs.10,000/- for every general victim and Rs.1,00,000/- for the legal representatives of those who had died due to Jaundice. The District Forum held that it had no pecuniary jurisdiction to adjudicate upon the complaint. The State Commission took the view that the District Forum has to go by the value as specified for each consumer. Rejecting the view taken by the State Commission, this Commission inter-alia held as under:

“5. In our opinion this proposition is clearly wrong since under the terms of Section 11 of the Act the pecuniary jurisdiction of the District Forum would depend upon the quantum of compensation claimed in the petition. The view expressed by the State Commission is not based on a correct understanding or interpretation of Section 11. On the plain words used in Section 11 of the Act, the aggregate quantum of compensation claimed in the petition will determine the question of jurisdiction and when the complaint is filed in a representative capacity on behalf of several persons, as in the present case, the total amount of compensation claimed by the representative body on behalf of all the persons whom it represents will govern the valuation of the complaint petition for purposes of jurisdiction”.

6. The quantum of compensation claimed in the petition being far in excess of Rs.1.00 lac the District Forum was perfectly right in holding that it had no jurisdiction to adjudicate upon the complaint. The reversal of the said order by the State Commission was contrary to law”.

Therefore, irrespective of the value of the goods purchased or the service hired and availed of by an individual purchaser / allottee and the compensation claimed in respect of an individual purchaser / allottee, this Commission would have the pecuniary jurisdiction to entertain the complaint if the aggregate of the value of the goods purchased or the services hired or availed of by the numerous consumers on whose behalf or for whose benefit the complaint is filed and the total compensation claimed for all of them exceeds Rs.1.00 crore.

Issue No. (iv)

13. As noted earlier, what is required for the applicability of Section 12(1)(c) of the Consumer Protection Act read with Order I Rule 8 of the Code of Civil Procedure is the sameness of the interest i.e. a common grievance of numerous persons which is sought to get redressed through a representative action. Therefore, so long as the grievance of the consumers is common and identical relief is claimed for all of them, the cost, size, area of the flat / plot and the date of booking / allotment / purchase, would be wholly immaterial. For instance, if a builder / developer has sold 100 flats in a project out of which 25 are three-bed room flats, 25 are two-bed room flats and 50 are one-bed room flats and he has failed to deliver timely possession of those flats, all the allottees irrespective of size of their respective flats / plots, the date of their respective purchase and the cost agreed to be paid by them have a common grievance i.e. the failure of the builder/ developer to deliver possession of the flat / plot sold to them and a complaint filed for the benefit of or on behalf of all such consumers and claiming same relief for all of them, would be maintainable under Section 12(1)(c) of the Consumer Protection Act. The relief claimed will be the same / identical if for instance, in a case of failure of the builder to deliver timely possession, refund, or possession or in the alternative refund with or without compensation is claimed for all of them. Different reliefs for one or more of the consumers on whose behalf or for whose benefit the complaint is filed cannot be claimed in such a complaint.

14. Reference order dated 11.8.2016

Issue No. (i)

It is evident from a bare perusal of Sections 21, 17 and 11 of the Consumer Protection Act that it’s the value of the goods or services and the compensation, if any, claimed which determines the pecuniary jurisdiction of the Consumer Forum. The Act does not envisage determination of the pecuniary jurisdiction based upon the cost of removing the deficiencies in the goods purchased or the services to be rendered to the consumer. Therefore, the cost of removing the defects or deficiencies in the goods or the services would have no bearing on the determination of the pecuniary jurisdiction. If the aggregate of the value of the goods purchased or the services hired or availed of by a consumer, when added to the compensation, if any, claimed in the complaint by him, exceeds Rs. 1.00 crore, it is this Commission alone which would have the pecuniary jurisdiction to entertain the complaint. For instance if a person purchases a machine for more than Rs.1.00 crore, a manufacturing defect is found in the machine and the cost of removing the said defect is Rs.10.00 lacs, it is the aggregate of the sale consideration paid by the consumer for the machine and compensation, if any, claimed in the complaint which would determine the pecuniary jurisdiction of the Consumer Forum. Similarly, if for instance, a house is sold for more than Rs.1.00 crore, certain defects are found in the house, and the cost of removing those defects is Rs.5.00 lacs, the complaint would have to be filed before this Commission, the value of the services itself being more than Rs.1.00 crore.

Issue No. (ii)

In Ghaziabad Development Authority Vs. Balbir Singh (2004) 5 SCC 65, the Hon’ble Supreme Court inter-alia observed and held as under:

“However the power to and duty to award compensation does not mean that irrespective of facts of the case compensation can be awarded in all matters at a uniform rate of 18% per annum. As seen above what is being awarded is compensation i.e. recompense for the loss or injury.

…Along with recompensing the loss the Commission / Forum may also compensate for harassment / injury both mental and physical. Similarly, compensation can be given if after allotment is made there has been cancellation of scheme without any justifiable cause.

That compensation cannot be uniform and can best of illustrated by considering case where possession is being directed to be delivered and cases where only monies are directed to be returned. In cases where possession is being directed to be delivered the compensation for harassment will necessarily have to be less because in a way that party is being compensated by increase in the value of the property he is getting. But in cases where monies are being simply returned then the party is suffering a loss inasmuch as he had deposited the money in the hope of getting a flat / plot. He is being deprived of that flat / plot. He has been deprived of the benefit of escalation of the price of that flat / plot. Therefore, the compensation in such cases would necessarily have to be higher”.

The Hon’ble Supreme Court thus recognized that the interest to the flat buyers is paid by way of compensation. In fact, though the Consumer Protection Act, authorises the Consumer Forum to award compensation, no specific powers to award interest has been conferred upon it. Therefore, in view of the provisions contained in Sections 21, 17 and 11 of the Consumer Protection Act, the amount of the interest, which can be paid as compensation, must necessarily be taken into account for determining the pecuniary jurisdiction.

Issue No. (iii)

Conflicting orders have been passed by the Benches of this Commission as to cut off date for determining the value of the goods or the services, as the case may be, in terms of Section 21, 17 and 11 of the Consumer Protection Act. One view is that the value of the goods or services means the consideration agreed to be paid by the consumer for the goods purchased or the services hired and availed of, whereas the other view is that the value of the goods or services as the case may be, for the purpose of determining the pecuniary jurisdiction of the Consumer Forum should be the market value of the goods or services on the date of institution of the consumer complaint. Though, the use of the word “value” in the above referred Sections, tends to suggest that it is the market price of the goods or the services, as the case may be, which when added to the amount of compensation, if any, claimed in the complaint, should determine the pecuniary jurisdiction of the Consumer Forum, on a deeper consideration we are of the view that it is the price of the goods or the services as the case may be agreed to be paid by the consumer which would be relevant for the purpose of determining the pecuniary jurisdiction. If the market price of the goods or the services as the case may be, on the date of institution of the complaint is to determine the pecuniary jurisdiction, the market price being dynamic and ever fluctuating, this would create an unending uncertainty with respect to the Consumer Forum before which the complaint is to be instituted. For instance, if there are 10 flat buyers in the same project, identical consideration is agreed to be paid by them to the service provider, one of them decides to approach the Consumer Forum at a time when the prevailing market value of the flat is more than Rs.1.00 crore, the complaint will have to be instituted before this Commission. If the prevailing market value of the flat at the time when another flat buyer who agreed to pay the same consideration to the service provider decides to approach the Consumer Forum is less than Rs.1.00 crore, he will have to approach the concerned State Commission. Therefore, there will be two separate Forums dealing with the complaints of these two consumers who agreed to pay same price for the flat purchased by them. In one case, the order passed in the consumer complaint would be challenged before the Hon’ble Supreme Court whereas in the other case, it would be challenged before this Commission. Creating such an anomalous situation, in our view, could not have been the legislative intent.

Moreover, if the pecuniary jurisdiction of the Consumer Forum varies with the market price of the goods or services at the time the complaint is instituted; there is a likelihood of the valuation given by the complainant, being seriously challenged by the opposite party. If this happens, the Consumer Forum will first have to determine the market price of the goods or services as the case may be, at the time of institution of the complaint. Such a determination is likely to be a time consuming process, besides being incapable of determination by way of a summary procedure, which the Consumer Forums are adopting. Such an interpretation therefore, is likely to be counterproductive and result in an inordinate delay in the disposal of the consumer complaint. On the other hand, no such difficulty is likely to arise if the sale consideration agreed to be paid by the consumer is taken as the value of the goods or services. In that case, the amount of compensation as claimed in the complaint needs to be added to the agreed consideration and the aggregate of the consideration and the compensation claimed in the complaint would determine the pecuniary jurisdiction of the Consumer Forum.

Issue No. (iv)

In view of the answer to the issues No. (ii) and (iii) of the reference order dated 24.5.2016, it is the aggregate value of the goods purchased or the services hired or availed of by all the consumers on whose behalf or for whose benefit the complaint is filed which, added to the total amount of compensation, if any, claimed for all such consumers determines the pecuniary jurisdiction of the Consumer Forum. The value of the goods purchased or the services hired or availed of by an individual consumer and the compensation claimed in respect of an individual consumer would have no bearing on such determination.

Issue No. (v) and (vi)

It is evident from a bare perusal of Section 12(1)(c) of the Consumer Protection Act that a complaint under the aforesaid provision can be filed only by one or more consumers. The term ‘consumer’ has been defined in Section 2(1)(d) of the Consumer Protection Act to mean any person who buys any goods for a consideration or who hires or avails of any services for a consideration and includes the user other than the purchaser of the goods and beneficiary other than the person hiring or availing of the services for consideration, with the permission of the person purchasing the goods or hiring or availing of the services, as the case may be. Therefore, a Cooperative Society or a group of Cooperative Societies is not entitled to file a complaint under Section 12(1)(c) of the Consumer Protection Act unless the cooperative society itself is a consumer as defined in Section 2(1)(d) of the Consumer Protection Act. Similarly, no group of Firms, Society or Association can file such a complaint unless such group of Firms, Society or Association itself is a consumer as defined in Section 2(1)(d) of the Consumer Protection Act. No person who does not qualify as a consumer in terms of Section 2(1)(d) of the Consumer Protection Act, can be party to a complaint under Section 12(1)(c) of the Act nor can he be amongst the persons on whose behalf or for whose benefit such a complaint is filed. In fact, a person who is not a consumer, as defined in Section 2(1)(d) of the Act, can invoke the jurisdiction of a Consumer Forum, by way of a consumer complaint.

Issue No. (vii)

As noted earlier, a complaint under Section 2(1)(c) of the Consumer Protection Act read with Order I Rule 8 of the Code of Civil Procedure can be filed where there are numerous consumers having the same interest i.e. a common grievance against the same person and the complaint is filed on behalf of or for the benefit of all such numerous consumers, and seeking same relief for all of them. Therefore, the Act does not envisage more than one complaints on behalf of such consumers, in a representative character. The decision in one complaint filed in a representative capacity will bind all the consumers on whose behalf or for whose benefit the complaint is filed, as provided in Order I Rule 8 (6) of the Code of Civil Procedure. Therefore, once a complaint, in a representative capacity is filed under Section 12(1)(c) of the Consumer Protection Act, and the requisite permission for filing such a complaint is given by the Consumer Forum, a second complaint, in a representative capacity under Section 12(1)(c) of the Consumer Protection Act would not be maintainable by or on behalf of consumers having the same interest and seeking the same relief and if filed, is liable to be dismissed with liberty to seek impleadment in the complaint already instituted in a representative capacity with the requisite permission of the Consumer Forum. Since a complaint in a representative capacity can be filed only on behalf of all the consumers having the same interest i.e. a common grievance and seeking the same relief against the same person, an individual complaint expressing such a grievance will not be maintainable and the only recourse available to a consumer having the same grievance is to seek impleadment in the complaint filed in the representative capacity. If such individual complaints are allowed even after the requisite permission in terms of Section 12(1)(c) is granted, that would be in contradiction of Order I Rule 8 (6) of the Code of Civil Procedure which makes an order passed in a suit / complaint filed in a representative capacity binding on all the persons on whose behalf or for whose benefit the suit / complaint is filed.

However, as far as the individual complaints instituted prior to grant of the requisite permission under Section 12(1)(c) of the Consumer Protection Act is concerned, they having been validly instituted, such complainants cannot be compelled to withdraw their individual complaint and become a party to the subsequently instituted complaint filed in a representative capacity. They having already taken recourse to the legal proceedings, the complaint instituted in a representative capacity, will not be deemed to have been instituted on behalf of or for the benefit of such complainants even if their grievance is identical to the grievance expressed in the complaint instituted in a representative character. They having already approached the Consumer Forum for the redressal of their grievance, it would be difficult to say that the complaint filed in a representative character was intended on their behalf or for their benefit as well. In fact, there may be a consumer having an identical grievance, who has already approached the Consumer Forum by way of an individual complaint and whose complaint has already been adjudicated before the requisite permission under Section 12(1)(c) of the Consumer Protection Act is accorded in a complaint filed in a representative capacity. Since, there cannot be more than one adjudication in respect of the same grievance of the same person, it cannot be said that the complaint instituted in a representative capacity was filed on his behalf or for his benefit as well. Therefore, the consumers, who are already before the Consumer Forum when the requisite permission, in terms of Section 12(1)(c) of the Consumer Protection Act is accorded, will be out of the purview of the said complaint. Since it cannot be said that the complaint in the representative capacity was filed on their behalf or for their benefit as well, the order passed in such a complaint will not be binding on them. If however, such persons want to withdraw their pending complaints and join the complaint instituted in the representative capacity, there is no bar on their adopting such a course of action. The decision, of course, would rest with them whether to continue with the individual complaint already instituted by them or to withdraw the said complaint and become party to the complaint filed in a representative capacity.

In one of the written submissions, it is contended that since a complaint in a representative capacity can be filed only on behalf of all the consumer having the same interest, such a complaint will not be maintainable where one or more individual complaints, expressing such a grievance are already pending. We however, are unable to accept the contention. No such restriction finds place in Section 12(1)(c) of the Consumer Protection Act or in Order I Rule 8 of the Code of Civil Procedure. Accepting such a contention would defeat the very purpose of allowing such a suit/complaint since every consumer would be compelled to file an individual complaint leading to multiplicity of proceedings. Such an interpretation would not serve the cause either of the consumer or of the service provider.

15. For the reasons stated hereinabove, the references are answered as under:

Reference dated 24.5.2016

Issue No. (i)

A complaint under Section 12 (1)(c) of the Consumer Protection Act can be filed only on behalf of or for the benefit of all the consumers, having a common interest or a common grievance and seeking the same / identical relief against the same person. Such a complaint however, shall not be deemed to have been filed on behalf of or for the benefit of the consumers who have already filed individual complaints before the requisite permission in terms of Section 12(1)(c) of the Consumer Protection Act is accorded.

Issue No. (ii), (iii) and (iv)

A complaint under Section 12 (1)(c) of the Consumer Protection Act is maintainable before this Commission where the aggregate of the value of the goods purchased or the services hired or availed of by all the consumers on whose behalf or for whose benefit the complaint is instituted and the total compensation, if any, claimed in respect of all such consumers exceeds Rs.1.00 crore. The value of the goods purchased or the services hired and availed of by an individual consumer or the size, or date of booking / allotment / purchase of the flat would be wholly irrelevant in such a complaint where the complaint relates to the sale / allotment of several flats / plots in the same project / building.

Reference dated 11.8.2016

Issue No. (i)

It is the value of the goods or services, as the case may be, and not the value or cost of removing the deficiency in the service which is to be considered for the purpose of determining the pecuniary jurisdiction.

Issue No. (ii)

The interest has to be taken into account for the purpose of determining the pecuniary jurisdiction of a Consumer Forum.

Issue No. (iii)

The consideration paid or agreed to be paid by the consumer at the time of purchasing the goods or hiring or availing of the services, as the case may be, is to be considered, along with the compensation, if any, claimed in the complaint, to determine the pecuniary jurisdiction of a Consumer Forum.

Issue No. (iv)

In a complaint instituted under Section 12(1)(c) of the Consumer Protection Act, the pecuniary jurisdiction is to be determined on the basis of aggregate of the value of the goods purchased or the services hired or availed by all the consumers on whose behalf or for whose benefit the complaint is instituted and the total compensation claimed in respect of such consumers.

Issue No. (v) & (vi)

A complaint under Section 12(1)(c) of the Consumer Protection Act can be instituted only by one or more consumers, as defined in Section 2(1)(d) of the Consumer Protection Act. Therefore, a group of Cooperative societies, Firms, Association or other Society cannot file such a complaint unless such society etc. itself is a consumer as defined in the aforesaid provision.

Issue No. (vii)

More than one complaints under Section 12(1)(c) of the Consumer Protection Act are not maintainable on behalf of or for the benefit of consumers having the same interest i.e. a common grievance and seeking the same / identical against the same person. In case more than one such complaints have been instituted, it is only the complaint instituted first under Section 12(1)(c) of the Consumer Protection Act, with the requisite permission of the Consumer Forum, which can continue and the remaining complaints filed under Section 12(1)(c) of the Consumer Protection Act are liable to be dismissed with liberty to join in the complaint instituted first with the requisite permission of the Consumer Forum.

The individual complaints instituted before grant of the requisite permission under Section 12(1)(c) of the Consumer Protection Act can continue despite grant of the said permission but it would be open to such complainants to withdraw their individual complaints and join as parties to the complaint instituted in a representative character. However, once the requisite permission under Section 12(1)(c) of the Consumer Protection Act is granted, an individual complaint, expressing the same grievance will not be maintainable and the only remedy open to a consumer having the same grievance is to join as a party to the complaint instituted in a representative character.

16. Before parting with the references, we would like to emphasise that considering the binding effect of a decision rendered in a complaint under Section 12(1)(c) of the Consumer Protection Act, on all the consumers, on whose behalf or for whose benefit such a complaint is filed, even if they chose not to join as a party to the complaint, it is necessary to exercise due care and caution while considering such a complaint even at the initial stage and to grant the requisite permission, only where the complaint fulfils all the requisite conditions in terms of Section 12(1)(c) of the Consumer Protection Act read with Order I Rule 8 of the Code of Civil Procedure; as interpreted in this reference. It would also be necessary for the Bench to either give individual notices or an adequate public notice of the institution of the complaint to all the persons on whose behalf or for whose benefit the complaint is instituted. Such a notice should disclose inter-alia (i) the subject matter of the complaint including the particulars of the project if the complaint relates to a housing project / scheme, (ii) the class of persons on whose behalf or for whose benefit the complaint is filed, (iii) the common grievance sought to get redressed through the class action, (iv) the alleged deficiency in the services and (v) the reliefs claimed in the complaint.

It will also be necessary to hear the opposite party, before taking a final view on the grant or otherwise of the permission required in terms of Section 12(1)(c) of the Consumer Protection Act.

17. The Complaint and the Appeals, in which references were made, be listed before the appropriate Benches, for further proceedings, in the light of the answer to the reference.

………………….J
D.K. JAIN
PRESIDENT

………………….
DR. B.C. GUPTA
MEMBER

………………….J
V.K. JAIN
MEMBER

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