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Consumer Protection Act, 1986 – ss.2(1)(d),(g) & (o) and 12 – Consumer – Deficiency in service – Claim for damages – Truck purchased in auction sale – Respondents authorities delayed delivery of the truck to appellant- auction purchaser and also, despite efforts made by him, did not hand over necessary papers of the truck to him for long number of years – Appellant could not ply the truck for such long number of years – Petition by appellant u/s.12 claiming damages – Held: Buyers of goods/commodities for “self consumption” in economic activities in which they are engaged would be consumers as defined in the Act – Appellant was ‘consumer’ within meaning of s.2(1)(d) as he purchased the truck for earning his livelihood by means of self-employment – Conduct, behaviour and attitude of respondents was highly reprehensible – There was deficiency in services on their part – Rs.1 lakh with 6% interest p.a. directed to be paid by respondents jointly or severally to the appellant. A truck was put in auction sale, on account of default in payment of instalments by its previous owner towards the loan taken by him from bank. Bid of the appellant was the highest. In 1999, the auction was confirmed and treated to be a final sale in favour of the appellant. Appellant deposited the requisite money consideration, however, the respondents authorities handed over the truck in question to the appellant only after six months from the date of auction. Even after getting delivery of the truck, the appellant could not start plying the same as he was not delivered the relevant papers thereof for long number of years despite efforts made by him. The relevant papers of the truck were handed over to the appellant six years after the date of auction. Meanwhile, the appellant filed petition Section 12 of the Consumer Protection Act, 1986 claiming damages. The appellant claimed damages @ Rs.500/- per day and interest at 5% on the amount of Rs.70,000/- deposited by him for the price of the truck and in addition, further claimed damages for mental and social injuries to the tune of Rs.50,000/- plus litigation expenses. The questions which arise for consideration in the present appeals were (i) whether the appellant was a ‘consumer’ within the definition of Section 2(1)(d) of the Act; and (ii) whether there was deficiency in services committed by respondents as contemplated under Section 2(1)(g) of the Act. Disposing of the appeals, the Court HELD:1. Appellant would be deemed to be a consumer within the definition as contained in Section 2(1)(d) of the Consumer Protection Act, 1986. A plain reading of Section 2(1) (d) of the Act makes it abundantly clear that appellant would fall in the category of a ‘consumer’ as he had bought the truck for a consideration which was paid by him. It was bought to be used exclusively for the purpose of earning his livelihood by means of self- employment. A further reading of the aforesaid definition of ‘consumer’ makes it clear that Parliament wanted to exclude from the scope of the definition the persons, who obtain goods for resale and also those who purchase goods with a view to use such goods for carrying on any activity for earning. The immediate purpose as distinct from the ultimate purpose of purchase, sale in the same form or after conversion and a direct nexus with profit or loss would be the determinants of the character of a transaction- whether it is for a “commercial purpose” or not. Thus, buyers of goods or commodities for “self consumption” in economic activities in which they are engaged would be consumers as defined in the Act. The purchase of the truck by the appellant would also be covered under explanation to Section 2(1)(d) of the Act. The appellant had mentioned categorically that he had bought the said truck to be used exclusively by him for the purpose of earning his livelihood, by means of self-employment. Even if he was to employ a driver for running the truck aforesaid, it would not have changed the matter in any case, as even then appellant would have continued to earn his livelihood from it and of course, by means of self-employment. Furthermore, there is nothing on record to show that he wanted to use the truck for any commercial purpose. [Paras 23, 24, 25 and 26] [1195-H; 1196-H; 1196-A-G] 2. There is nothing on record to show that any stay was granted in favour of any party, restraining the respondents not to deliver the papers of the truck to the appellant. It would go to show that respondents were unlawfully holding back the papers with them, for which, otherwise they were not entitled to do so. The truck in question was actually handed over to the appellant almost after six months from the date of auction in his favour. Even after getting delivery of the truck he could not have started plying the same unless he was delivered the relevant papers thereof. There is no dispute, which even otherwise stands proved from the voluminous material available on record that despite best efforts made by the appellant, the relevant papers of the truck were handed over to him only after six years from the date of the auction. No plausible or convincing reasons have been assigned by the respondents for not doing so. From the narration of the aforesaid facts, it is clearly made out that respondents were at fault in performance of the services which was otherwise required to be performed by them. What more could be the deficiency in service cannot be described. The respondents were certainly imperfect and the same would amount to shortcoming in quality in providing the service to the appellant. Thus, all the ingredients, to enable the appellant to claim damages under the Act were made out. This has in fact been found by the National Commission also, that is why it proceeded to award compensation of Rs. 25,000/- to the appellant. [Paras 21, 28, 29 and 30] [1194-H; 1195-A; 1197-F-H; 1198-A-C] 3.1. The appellant suffered loss of earning firstly due to non-delivery of vehicle and then due to highly belated supply of requisite documents. Moreover, the value of the truck also depreciated resulting in further loss to him. Thus, the amount awarded by National Commission is too meagre and deserves to be enhanced. [Para 32] [1198-E-F] 3.2. The conduct, behaviour and attitude of the respondents, throughout, has been highly reprehensible. When the bank had issued a Fard Nilami and respondents were entrusted with the job of auction then the said auction should have been implemented fully in letter and spirit. Once the highest bid of the appellant was knocked down in his favour, pursuant thereto, he had deposited the requisite amounts, then as a necessary consequence thereof he should have been delivered the truck immediately along with the necessary documents. For the reasons best known to the respondents they had not only delayed delivery of the truck but had also, despite the efforts made by the appellant, not handed over the papers of the truck to him for long number of years. Any explanation offered during the course of the arguments is not acceptable, which certainly shows their malafide intentions. [Para 34] [1199-B-D] 3.3. Even assuming for a moment that bank had not delivered the papers of the truck to the respondents then it was the duty of the respondents to have insisted the bank for delivery of the papers which they had failed to do. Thus, in any case, there cannot be any escape of the respondents from shaking off the liability fastened on them by the National Commission. [Para 35] [1199-E] 3.4. Taking the totality of the situation as it exists, a total amount of Rs. 1,00,000/- payable by respondents jointly or severally to the appellant would subserve the justice. [Para 36] [1199-F] 4. Even though the Act specifically does not authorise to grant interest but in appropriate cases, grant of interest on the facts and circumstances of the case is permissible. In this case also, keeping the circumstances under which appellant was made to run from pillar to post, to get the documents of the truck from the respondents, ends of justice would be met if interest at the rate of 6% p.a. from the date of the original application till actual payment of the aforesaid enhanced awarded amount is made by the respondents. [Paras 37 and 38] [1199-G-H; 1200-A-B] CIVIL APPELLATE JURISDICTION : Civil Appeal Nos. 5165 of 2009. From the Judgment & Order dated 18.5.2005 of the National Consumer Disputes Redressal Commission, New Delhi in Revision Petition No. 929 of 2003. WITH C.A. No. 5166 of 2009. R.K. Kapoor, Gunjan Sinha, H. Pant, Anis Ahmed Khan for the Appellants. R.K. Gupta, Manoj Dwivedi, Gunnam Venkateswara Rao for the Respondents.

The supreme court of india. Taken about 170 m ...

The supreme court of india. Taken about 170 m from the main building outside the perimeter wall (Photo credit: Wikipedia)

REPORTABLE
IN THE SUPREME COURT OF INDIA

CIVIL APPELLATE JURISDICTION

CIVIL APPEAL NO. 5165 OF 2009
[Arising out of S.L.P.(C)No.20515 of 2005]
Madan Kumar Singh (D) Thr. LR. ….Appellant

Versus

Distt. Magistrate, Sultanpur & Ors. …Respondents

WITH

CIVIL APPEAL NO. 5166 OF 2009
[Arising out of S.L.P.(C)No.11210 of 2006]
J U D G M E N T
Deepak Verma, J.

1.Leave granted.

2.For the sake of convenience, facts have been

taken from the appeal arising out of

S.L.P.(C)No.20515 of 2005.

3.Appellant was an auction purchaser of a truck

bearing registration No. UP I-4775, put to an

auction sale, on account of default in payment of

instalments committed by its previous owner Iqbal,

having taken loan from Union Bank of India under

“Self Employment Scheme”. Recovery Certificate was

issued to the Collector, Sultanpur (U.P.) by the

said bank. The auction was held in the Tehsil
Compound, Sultanpur, on 19.8.1999. The appellant’s

bid for a sum of Rs. 70,000/- being the highest,

was knocked down in his favour and accepted by

respondent No. 1.

4.As per the terms and conditions of the auction,

appellant deposited a sum of Rs. 20,000/-, as soon

as the bid was knocked down in his favour. Since no

objection was received against the said auction

sale, the appellant deposited balance amount of

Rs. 50,000/- on 20.8.1999.

5.On 19.9.1999, the said auction was confirmed,

since no objections were received much less, from

the previous owner Iqbal. Thus, it was treated to

be a final sale in favour of the appellant.

6.Obviously, after the sale having been confirmed

in favour of the appellant, he was entitled to

receive possession of the truck, which was not

delivered to him by the respondents. Thus he made

a representation on 30.11.1999 for delivery

thereof. He continued to make several

representations with the respondents for delivery

of the truck purchased in the auction and also to

hand over to him the documents so that the vehicle

could be transferred in the name of the appellant

so as to enable him to ply the same. It appears
that truck was delivered to the appellant after

about six months from the date of auction sale, for

which no plausible reasons were assigned by the

respondents.

7.Despite handing over possession of the truck at a

belated stage, respondents did not deliver

necessary documents of the truck to the appellant

so as to enable him to get the vehicle transferred

in his name, thereby depriving him of its

commercial use, the purpose for which he had

purchased.

8.He was therefore, constrained to file a petition

under Section 12 of the Consumer Protection Act,

1986 (for brevity, ‘the Act’) claiming damages.

9.Appellant was ultimately delivered the possession

of the truck on 14.3.2000, during the pendency of

the complaint before the District Forum. The

relevant papers thereof were not handed over to

him for a long time but on persistent requests, the

same were handed over to him some time in the month

of January, 2005. Thus after a lapse of more than

five years from the date, the auction was confirmed

in favour of the appellant.

10.The District Consumer Forum dismissed the

complaint of the appellant holding therein that
appellant is not a “consumer” within the definition

of the Act.

11.Feeling aggrieved, appellant filed an appeal

before the State Consumer Disputes Redressal

Commission, Uttar Pradesh, Lucknow which was

registered as Appeal No. 2327 of 2000. The State

Commission dismissed the appeal with certain

observations reproduced herein below:

 

“The District Consumer Forum Sultanpur
has dismissed the complaint on the finding
that such matters are not cognizable by it
under COPRA. No error at all can be found
in the aforesaid finding. It is open to
the appellant to file copy of this order
before District Magistrate Sultanpur with
such prayer relating to the documents of
the vehicle as advised. The District
Magistrate will deal with such
representation in accordance with law and
pass necessary orders within two months.”
12.Pursuant thereto, appellant submitted

representation to the District Magistrate on

17.2.2003 and continued to remind them that they

have to deliver the necessary documents to the

appellant so as to enable him to get the vehicle

transferred in his name, which would further enable

him to use the same for commercial purposes.

13.Against the order of the State Commission,

appellant filed Revision Petition No. 929 of 2003
before the National Consumer Disputes Redressal

Commission, New Delhi. The same came to be

disposed of vide impugned order on 18.5.2005 and

the complaint filed by appellant has partly been

allowed with the following directions:

“In view of the long delay, we are inclined
to grant damages to the extent of Rs.
25,000/- along with cost of Rs.5000/-
payable by the respondents to the Petitioner
jointly and severally. In view of the facts
and circumstances of the case, we direct the
District Magistrate, Sultanpur, U.P. to
conduct an inquiry into the matter and fix
the responsibility including the recovery of
this awarded amount from the officers who
are found guilty of deficiency/negligence in
this case.”

14. Feeling aggrieved thereby the auction

purchaser Madan Kumar Singh (since dead) preferred

a Special Leave Petition whereas respondents have

also preferred Special Leave Petition against

Madan Kumar Singh (since dead).

15. The original appellant having died during the

pendency of the appeal, his legal representative

was brought on record.

16. We have, accordingly, heard the learned

counsel for the appellant Mr. R.K. Kapoor and

learned counsel for the respondents Mr. R.K. Gupta

at length. Perused the record.

17. The questions which arise for consideration in

the aforesaid appeals are (i) whether the appellant
can be said to be ‘consumer’ within the definition

of Section 2(1)(d) of the Act; and (ii) whether it

can be said that there has been deficiency in the

services committed by respondents as contemplated

under Section 2(1)(g) of the Act.

18. It is pertinent to mention here that even

though respondents were parties before the District

Consumer Forum, State Commission, as also before

the National Commission but they neither preferred

to file any objections nor participated in the

proceedings. Thus were proceeded ex-parte

throughout.

19. Even though there has been long and chequered

history of various litigations in the High Court of

Allahabad and a civil suit which were either at the

instance of previous owner of the truck Iqbal Ahmed

or by Maqsood Ahmed, apparently set up by Iqbal

Ahmed but we are not concerned with the same, in

the aforesaid appeal. Needless to say that in

none of the proceedings either initiated by Iqbal

Ahmed or his stooge Maqsood Ahmed there was any

order of stay granted by any court that appellant

herein should not be delivered the relevant

documents of the truck, so as to enable him to

start plying the same.
20. It is trite to say that mere filing of a

Petition, Appeal or Suit, would by itself not

operate as stay until specific prayer in this

regard is made and orders thereon are passed.

21. There is nothing on record to show that any

stay was granted in favour of any party,

restraining the respondents not to deliver the

papers of the truck to the appellant. It would go

to show that respondents were unlawfully holding

back the papers with them, for which, otherwise

they were not entitled to do so.

22. To deal with the question projected

hereinabove in the aforesaid appeal, it is

necessary to go through the definition of

‘Consumer’ as contained in Section 2(1)(d) of the

Act.

“2(d) “Consumer” means any person who –

(i) Buys any goods 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
user of such goods other than the
person who buys such goods for consideration
paid or promised or partly paid or partly
promised, or under any system of deferred
payment when such use is made with the
approval of such person, but does not
include a person who obtains such goods for
resale or for any commercial purpose;
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 [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.

[Explanation- For the purposes of sub-
clause (i), “commercial purpose” does not
include use by a consumer of goods bought
and used by him exclusively for the purpose
of earning his livelihood, by means of self-
employment;]”.
23. Plain reading of the same makes it abundantly

clear that appellant herein would fall in the

category of a ‘consumer’ as he had bought the

truck for a consideration which was paid by him.

It was bought to be used exclusively for the

purpose of earning his livelihood by means of self-

employment. The said pleading by way of amendment

was incorporated by the appellant in his

application filed under Section 12 of the Act,

before the District Consumer Forum but proper

cognizance thereof has not been taken.

24. A further reading of the aforesaid definition

of ‘consumer’ makes it clear that Parliament wanted

to exclude from the scope of the definition the

persons, who obtain goods for resale and also those

who purchase goods with a view to use such goods
for carrying on any activity for earning. The

immediate purpose as distinct from the ultimate

purpose of purchase, sale in the same form or

after conversion and a direct nexus with profit or

loss would be the determinants of the character of

a transaction-whether it is for a “commercial

purpose” or not. Thus, buyers of goods or

commodities for “self consumption” in economic

activities in which they are engaged would be

consumers as defined in the Act.

25. Apart from the above, it may also be seen that

the purchase of the truck by the appellant would

also be covered under explanation to

Section 2(1)(d) of the Act. The appellant had

mentioned categorically that he had bought the said

truck to be used exclusively by him for the purpose

of earning his livelihood, by means of self-

employment. Even if he was to employ a driver for

running the truck aforesaid, it would not have

changed the matter in any case, as even then

appellant would have continued to earn his

livelihood from it and of course, by means of self-

employment. Furthermore, there is nothing on

record to show that he wanted to use the truck for

any commercial purpose.
26. Thus, the question No.1 is answered in favour

of the appellant that he would be deemed to be a

consumer within the definition as contained in

Section 2(1)(d) of the Act.

27. Coming to question No.2 whether there has been

a deficiency in the services committed by

respondents as contained in Section 2(1)(g) and (o)

of the Act or not, “deficiency” and “services” have

been defined as under:

“2(1)(g) “deficiency” means 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.

2(1)(o) “service” means service of any
description which is made available to
potential users and includes 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.”
28. The facts mentioned hereinabove would go to

show that appellant having been declared as highest

bidder had deposited the initial money and next day

deposited the balance of the consideration. The
truck in question was actually handed over to him

almost after six months from the date of auction in

his favour. Even after getting delivery of the

truck he could not have started plying the same

unless he was delivered the relevant papers

thereof. There is no dispute, which even otherwise

stands proved from the voluminous material

available on record that despite best efforts made

by the appellant, the relevant papers of the truck

were handed over to him only after six years from

the date of the auction. No plausible or

convincing reasons have been assigned by the

respondents for not doing so.

29. From the narration of the aforesaid facts, it

is clearly made out that respondents were at fault

in performance of the services which was otherwise

required to be performed by them. What more could

be the deficiency in service cannot be described.

According to us, respondents were certainly

imperfect and the same would amount to shortcoming

in quality in providing the service to the

appellant.

30. Thus, in our considered opinion, all the

ingredients, to enable the appellant to claim

damages under the Act were made out. This has in
fact been found by the National Commission also,

that is why it proceeded to award compensation of

Rs. 25,000/- to the appellant.

31. Now, the question that arises for

consideration before us is whether the amount of

compensation awarded to the appellant is just and

proper or deserves to be enhanced.

32. Even though the appellant claimed damages @

Rs.500/- per day and interest at 5% on the amount

of Rs.70,000/- deposited by him for the price of

the truck in addition, he further claimed damages

for mental and social injuries to the tune of

Rs.50,000/- + litigation expenses but in absence of

any cogent and valid evidence available on record,

it is not proper to consider the reliefs as claimed

by the appellant. However, there is no doubt that

the appellant suffered loss of earning firstly due

to non-delivery of vehicle and then due to highly

belated supply of requisite documents. Moreover,

the value of the truck also depreciated resulting

in further loss to him. Thus, in our opinion, the

amount awarded by National Commission is too meagre

and deserves to be enhanced.

33. During the course of arguments, Sh. R.K.

Gupta, learned counsel for the respondents also
made submissions that since the documents

pertaining to the truck were received late from the

bank, therefore, the same could not be delivered to

the appellant herein. However, this plea had not

been taken by the respondents nor it is reflected

from any of the documents filed by respondents in

their own appeal. It is, therefore, clearly an

afterthought and has been taken so as to shield the

unwarranted action of the respondents.

34. The conduct, behaviour and attitude of the

respondents, throughout, has been highly

reprehensible. When the bank had issued a Fard

Nilami and respondents were entrusted with the job

of auction then the said auction should have been

implemented fully in letter and spirit. Once the

highest bid of the appellant was knocked down in

his favour, pursuant thereto, he had deposited the

requisite amounts, then as a necessary consequence

thereof he should have been delivered the truck

immediately along with the necessary documents.

For the reasons best known to the respondents they

had not only delayed delivery of the truck but had

also, despite the efforts made by the appellant,

not handed over the papers of the truck to him for

long number of years. Any explanation offered
during the course of the arguments is not

acceptable to us, which certainly shows their

malafide intentions.

35. Even assuming for a moment that bank had not

delivered the papers of the truck to the

respondents then it was the duty of the respondents

to have insisted the bank for delivery of the

papers which they had failed to do. Thus, in any

case, there cannot be any escape of the respondents

from shaking off the liability fastened on them by

the National Commission.

36. Taking the totality of the situation as it

exists, we are of the opinion that a total amount

of Rs. 1,00,000/- payable by respondents jointly or

severally to the appellant would subserve the

justice.

37. Even though the Act specifically does not

authorise to grant interest but in appropriate

cases, grant of interest on the facts and

circumstances of the case is permissible. The same

has been done by this Court in long catena of

cases.

38. In this case also, keeping the circumstances

under which appellant was made to run from pillar

to post, to get the documents of the truck from the
respondents, we are of the opinion that ends of

justice would be met if interest at the rate of 6%

p.a. from the date of the original application till

actual payment of the aforesaid enhanced awarded

amount is made by the respondents. We accordingly

do so. The appeal arising out of SLP(C) No.20515

of 2005 is allowed with costs and Appeal arising

out of SLP (C) No.11210 of 2006 is dismissed with

costs. Counsel fee assessed at Rs.10,000/- each.

…………………
…J.
[S.B. SINHA]
…………………..J.
[DEEPAK VERMA]
New Delhi.
August 07, 2009.

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