18 July 2020 4:37 AM GMT
Determination of compensation for the loss or injury suffered by a consumer on account of deficiency in service: In the matter of: Charan Singh V/s Healing Touch Hospital & Ors, (2000) 7 SCC 668, it was held that: "… While quantifying damages, Consumer Forums are required to make an attempt to serve the ends of justice so that compensation awarded, in an...
In the matter of: Charan Singh V/s Healing Touch Hospital & Ors, (2000) 7 SCC 668, it was held that:
"… While quantifying damages, Consumer Forums are required to make an attempt to serve the ends of justice so that compensation awarded, in an established case, which not only serves the purpose of recompensing the individual, but which also at the same time, aims to bring about a qualitative change in the attitude of the service provider. Indeed, calculation of damages depends on the facts and circumstances of each case. No hard and fast rule can be laid down for universal application. While awarding compensation, a Consumer Forum has to take into account all relevant factors and assess compensation on the basis of accepted legal principles, on moderation. It is for the Consumer Forum to grant compensation to the extent it finds it reasonable, fair and proper in the facts and circumstances of a given case according to the established judicial standards where the claimant is able to establish his charge."
Similarly, the Hon'ble NCDRC in the matter of: Air France V/s O.P. Srivastava & Ors, First Appeal No. 310/ 2008 (Date of Decision: 22.03.2018) observed that:
"… It is trite that in considering the quantification of compensation, a precise calculation is difficult, as no clear or straitjacketed principles can be designed for the said purpose. Hence, the exercise would invariably involve discretion and consideration of a plethora of variables, depending on the facts and circumstances of the case. Some broad factors that may be considered while scrutinizing claims for compensation/ damages include:
Needless to add that the above parameters are only illustrative and not exhaustive."
In the matter of: New India Assurance Co. Ltd. V/s Hilli Multipurpose Cold Storage (P) Ltd., 2020 SCC Online SC 287, it was held that:
In the matter of: Lucknow Development Authority V/s M.K. Gupta, (1994) 1 SCC 243, it was held that:
"… 4. What is the meaning of the word 'service'? Does it extend to deficiency in the building of a house or flat? Can a complaint be filed under the Act against the statutory authority or a builder or contractor for any deficiency in respect of such property.
It is in three parts. 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 thus, "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.
The legislative intention is thus clear to protect a consumer against services rendered even by statutory bodies. The test, therefore, is not if a person against whom complaint is made is a statutory body but whether the nature of the duty and function performed by it is service or even facility.
… 5. … Truly speaking it would be a service to the society if such bodies instead of claiming exclusion subject themselves to the Act and let their acts and omissions be scrutinized as public accountability is necessary for healthy growth of society.
… 6. … So any service except when it is free of charge or under a constraint of personal service is included in it [Section 2 (o) of the Consumer Protection Act, 1986]. …"
That following the ratio in the matter of Lucknow Development Authority (Supra), the Hon'ble Supreme Court of India, recently, in the matter of: Punjab Urban Planning & Development Authority V/s Vidya Chetal, SLP (C) No. 4272/ 2015 (Date of Decision: 16.09.2019) observed that:
That in the matter of: Ambrish Kumar Shukla & Ors V/s Ferrous Infrastructure (P) Ltd, CC No. 97/ 2016, NCDRC (Date of Decision: 07.10.2016) it was held as follows:
"… 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 [NCDRC] 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 [NCDRC], the value of the services itself being more than Rs. 1.00 crore."
In the matter of: Munish Sahgal V/s DLF Home Developers Ltd., First Appeal No. 425/ 2010, NCDRC (Date of Decision: 09.02.2011), it was held that:
Moreover, in the matter of: M/s. Sonic Surgical V/s National Insurance Co. Ltd., (2010) 1 SCC 135, while observing that "cause of action" determines the territorial jurisdiction as regards the place where consumer complaint is to be filed or preferred, to avoid the malice of "bench hunting", it was held that:
"… Learned counsel for the appellant submitted that the respondent-insurance company has a branch office at Chandigarh and hence under the amended Section 17(2) the complaint could have been filed in Chandigarh. We regret, we cannot agree with the learned counsel for the appellant. In our opinion, an interpretation has to be given to the amended Section 17(2) (b) of the Act, which does not lead to an absurd consequence. If the contention of the learned counsel for the appellant is accepted, it will mean that even if a cause of action has arisen in Ambala, then too the complainant can file a claim petition even in Tamil Nadu or Gauhati or anywhere in India where a branch office of the insurance company is situated. We cannot agree with this contention. It will lead to absurd consequences and lead to bench hunting. In our opinion, the expression 'branch office' in the amended Section 17(2)would mean the branch office where the cause of action has arisen. No doubt this would be departing from the plain and literal words of Section 17(2)(b) of the Act but such departure is sometimes necessary (as it is in this case) to avoid absurdity. [vide G.P. Singh's Principles of Statutory Interpretation, Ninth Edition, 2004 P. 79] In the present case, since the cause of action arose at Ambala, the State Consumer Redressal Commission, Haryana alone will have jurisdiction to entertain the complaint."
Recently, in the matter of: M/s. Emaar MGF Land Ltd V/s Aftab Singh, Review Petition (C) No. 2629-2630/ 2018 in Civil Appeal No. 23512- 23513/ 2017, Supreme Court of India (Date of Decision: 10.12.2018), it was held that:
"Even if there exists an arbitration clause in an agreement and a complaint is made by the consumer, in relation to a certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal Agency, constituted under the Consumer Protection Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force."
Ratio in the matter of Skypak Couriers Ltd (Supra) was upheld in the matter of M/s. Emaar MGF Land Ltd (Supra).
"… 25. This Court in the series of judgments as noticed above considered the provisions of Consumer Protection Act, 1986 as well as Arbitration Act, 1996 and laid down that complaint under Consumer Protection Act being a special remedy, despite there being an arbitration agreement the proceedings before Consumer Forum have to go on and no error committed by Consumer Forum on rejecting the application [under Section 8 of the A&C Act]. There is reason for not interjecting proceedings under Consumer Protection Act on the strength [of] an arbitration agreement by Act, 1996. The remedy under Consumer Protection Act is a remedy provided to a consumer when there is a defect in any goods or services. The complaint means any allegation in writing made by a complainant has also been explained in Section 2(c) [Section 2 (1) (c)] of the Act. The remedy under the Consumer Protection Act is confined to complaint by consumer as defined under the Act for defect or deficiencies caused by a service provider, the cheap and a quick remedy has been provided to the consumer which is the object and purpose of the Act as noticed above."
In the matter of: Yashwant Rama Jadhav V/s Shaukat Hussain Shaikh & Anr, First Appeal No. 1229/ 2017, NCDRC (Date of Decision: 10.11.2017), it was held that:
In the matter of: Manu Solanki & Ors V/s Vinayaka Mission University, Consumer Case No. 261/ 2012, NCDRC (Date of Decision: 20.01.2020), it was held that:
"… Another relevant issue which was raised during the course of arguments was with respect to any defect or deficiency in the transportation which is provided by the schools/ colleges. School buses are vehicles hired by the Institutions and in most schools is made compulsory with, the prescribed fees including the cost of transportation. Children come in their own vehicles also and we are of the view that any defect or deficiency in transporting the children to the school does fall within the definition of 'imparting knowledge' and, therefore, the Consumer Fora has no jurisdiction to entertain such Complaints arising out of these issues."
"… As laid down by this Court in Laxmi Engineering Works, the explanation to Section 2(1)(d) of the Act clarifies that "in certain situations, purchase of goods for "commercial purpose" would not yet take the purchaser out of the definition of expression 'consumer'. If the commercial use is by the purchaser himself for the purpose of earning his livelihood by means of self- employment, such purchaser of goods is yet a 'consumer'". This Court went on to observe that what is "Commercial Purpose" is a question of fact to be decided in the facts of each case."
In the matter of: Pratibha Pratisthan & Ors. V/s Manager, Canara Bank & Ors., Civil Appeal No. 3560/ 2008, Supreme Court of India (Date of Decision: 07.03.2017), it was held that:
In the matter of: Pioneer Urban Land and Infrastructure Ltd & Anr V/s Union of India & Ors, 2019 SCC Online SC 1005, it was held that:
The Hon'ble NCDRC in the matter of: East India Construction Co. V/s Modern Consultancy Services, (2006) CPJ 289 (NC), observed as follows:
"… That the first issue has been answered by the Commission in the catena of judgments wherein it has been held that even though the machine/ equipment is used for commercial/ industrial purposes if any manufacturing defect occurs during the warranty period then, the issue is covered under the Act [The Consumer Protection Act, 1986] and for that purpose purchaser of the equipment is entitled to file a complaint under the Act…"
In the matter of: Ravneet Singh Bagga V/s KLM Royal Dutch Airlines & Anr, (2000) 1 SCC 66, it was held that:
"… The deficiency in service cannot be alleged without attributing fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be performed by a person in pursuance of a contract or otherwise in relation to any service. The burden of proving the deficiency in service is upon the person who alleges it. The complainant has on facts, been found to have not established any wilful fault, imperfection, shortcoming or inadequacy in the service of the respondent. The deficiency in service has to be distinguished from the tortious acts of the respondent. In the absence of deficiency in service the aggrieved person may have a remedy under the common law to file a suit for damages but cannot insist for grant of relief under the Act for the alleged acts of commission and omission attributable to the respondent which otherwise do not amount to deficiency in service. In case of bona fide disputes no wilful fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance in the service can be informed (sic). If on facts it is found that the person or authority rendering service had taken all precautions and considered all relevant facts and circumstances in the course of the transaction and that their action or the final decision was in good faith, it cannot be said that there had been any deficiency in service. If the action of the respondent is found to be in good faith, there is no deficiency of service entitling the aggrieved person to claim relief under the Act. The rendering of deficient service has to be considered and decided in each case according to the facts of that case for which no hard and fast rule can be laid down. Inefficiency, lack of due care, absence of bona fides, rashness, haste or omission and the like may be the factors to ascertain the deficiency in rendering the service." (emphasis supplied)
In the matter of: M/s. Kranti Associates (P) Ltd & Anr V/s Sh. Masood Ahmed Khan & Ors, (2010) 9 SCC 496, it was held that:
In the matter of: Anjum Hussain V/s Intellicity Business Park (P) Ltd., Civil Appeal No. 1676/ 2019 (Date of Decision: 10.05.2019), the Hon'ble Supreme Court of India, upheld the observations made in the matter of: Ambrish Kumar Shukla & Ors (Supra), where by it was observed that:
"… 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." (emphasis supplied)
That in the matter of Anjum Hussain (Supra) it was categorically observed that:
 Ghaziabad Development Authority V/s Balbir Singh, (2004) 5 SCC 65
 Standard Chartered Bank Ltd. V/s Dr. B.N. Raman, (2006) 5 SCC 727