Ludhiana Commission Orders Volvo’s Dealers To Refund 86k To Car Owner With 10k Compensation For Charging Repair Costs Despite Warranty

Brief Facts:

Dr. Amarbir Singh (“Complainant”) purchased a brand-new Volvo XC-5 vehicle (“Manufacturer”) from M/s. Auto Kashyap (India) Private Limited (“Dealer”), an authorized dealer of the manufacturer. The purchase was made on 07.03.2015 for a sum of Rs. 45,82,716. The manufacturer offered a warranty for three years or 60,000 miles on its cars, covering component failures due to faulty materials or workmanship during manufacturing. An extended warranty was also obtained by the complainant for the vehicle, extending coverage until 06.03.2019. In August 2016, a malfunction occurred in the vehicle's door lock/unlock button, which was attributed to poor craftsmanship. The complainant approached M/s. Krishna Auto Sales (“Service Provider”), an authorized dealer of the manufacturer, for replacement. Despite initial resistance, the switch was eventually replaced.

On 02.09.2018, during a journey, the car's air conditioner stopped working. The complainant took the vehicle to the service provider, which diagnosed a leakage in the car's evaporator. Despite the vehicle being within warranty and having run only 45,805 km, the service provider refused to provide free service for the issue, leading the complainant to pay Rs. 85,992 to have the problem fixed. Aggrieved, the complainant filed a consumer complaint in the Ludhiana District Consumer Disputes Redressal Commission (“District Commission”).

The complainant contended that the air conditioner issue was due to a manufacturing defect, as there were no marks or scratches indicating external damage. He claimed that he had suffered mental agony, harassment, and financial loss due to the unfair practices of the dealers.

The manufacturer contended that the complaint lacked cause of action and was not maintainable under section 26 of the Consumer Protection Act. They argued that the vehicle had covered nearly 46,000 km before the alleged defect arose, and thus, any claims of manufacturing defects were baseless. They denied any deficiency in service on their part.

Despite being served notice, neither the dealer nor the service provider appeared before the commission to defend their case. Consequently, the complaints against them were proceeded against ex-parte.

Observations by the District Commission:

The District Commission dismissed the complaint against the manufacturer. It held that the complainant's contention regarding a manufacturing defect lacked merit and substance. The District Commission pointed out that the vehicle had already covered a significant distance of approximately 46,000 km before the alleged defect emerged. In this regard, the District Commission referred to Honda Cars India Limited Vs Sudesh Berry & Others (Civil Appeal No.6802 of 2021) where the Supreme Cort held that a manufacturer cannot be held liable for defects that arise due to an accident or extensive usage.

Further, the District Commission assessed the complainant's argument that the air conditioner malfunction was a result of a manufacturing defect. However, the District Commission noted that the vehicle had already covered a significant distance before the alleged defect emerged. The District Commission emphasized the dealer’s and the service provider’s responsibility to uphold the warranty agreements and provide service without undue charges during the warranty period. It pointed out that the dealer’s and the service provider’s insistence on payment for repairs was against the terms and conditions of the warranty agreement, causing the complainant mental agony and financial loss.

While the District Commission dismissed the complaint against the manufacturer, it held the dealer and the service provider responsible for the undue charges and mental agony faced by the complainant. As a result, the District Commission ordered M/s Auto Kashyap (India) Private Limited (dealer) and Krishna Auto Sales (service provider) to refund the amount of Rs. 85,992/- to Dr. Amarbir Singh (complainant) with an interest rate of 8% per annum from the date of the order until the actual payment. Additionally, the dealers were directed to pay a composite cost of Rs. 10,000 as compensation to the complainant.

Case: Dr. Amarbir Singh vs Volvo Auto India Pvt. Ltd

Case No.: CC/19/195

Advocate for the Complainant: Rajat Malhotra

Advocate for the Respondent: Ankush Choundhary

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