Vs. Asstt. Engineer  INSC 234 (12 April 1994)
N.P. (J) Singh N.P. (J) Kuldip Singh (J) Hansaria B.L. (J)
1994 SCC (3) 504 JT 1994 (3) 623 1994 SCALE (2)530
Judgment of the Court was delivered by N.P. SINGH, J.-This appeal has been
filed, against an order passed by the 'National Commission', established under
the Consumer Protection Act, 1986 . setting aside the orders passed by the
State Commission and the 506 District Forum, and dismissing the petition of
complaint filed on behalf of the appellant against Respondent 1 (hereinafter
referred to as 'the respondent').
appellant booked a tractor with the respondent and deposited an amount of Rs
2500 as an advance on 12-12-1990.
price of the tractor was quoted at Rs 1,86,975. The appellant was first to
receive the tractor from the said respondent according to the list of booking.
On an application made on behalf of the appellant, Allahabad Bank, Shahpur,
sanctioned loan to the appellant, which decision was communicated by a letter
dated 5-2-199 1.
Although in the list of the persons to whom the tractors were to be supplied,
the position of the appellant was against Serial No. 1, the said respondent,
according to the appellant, went on supplying tractors to others, who were
below the appellant in the said list. In the meantime, there was a rise in the
price of the tractor and ultimately when the tractor was supplied to the
appellant on 21-9-1991, the appellant had to pay Rs 2,27,664.
In this process, the appellant suffered a loss of Rs 40,690 for no fault of his
and due to the conduct and practice adopted by the respondent.
complaint under the Consumer Protection Act was filed on behalf of the
appellant, before the District Forum. The District Forum, on consideration of
the materials produced on behalf of the parties, came to the conclusion that
the respondent intentionally did not deliver the tractor to the appellant,
although the appellant was prepared to purchase the same. It was also held that
the respondent supplied the tractors to others who were below the appellant in
the list of booking and because of the delay, the appellant had to pay an extra
amount of Rs 40,690. A direction was given to the respondent to refund Rs
40,690 along with the interest at the rate of 18% per annum with effect from 21-9-1991. A compensation of Rs 2000 was also directed to be
paid to the appellant for the harassment and mental agony caused to him due to
the unfair trade practice indulged by the respondent.
appeal filed on behalf of the respondent before the State Commission was
dismissed, affirming the finding that because of the unfair trade practice
adopted by the respondent, by delaying the delivery of the tractor to the
appellant, the appellant had to pay an extra amount of Rs 40,690.
National Commission, however, held that the mere fact "that there has been
delay in the delivery of the tractor, will not constitute 'unfair trade
practice' under the definition of the said expression contained in the Consumer
Protection Act". The petition of complaint filed on behalf of the
appellant was dismissed. The National Commission did not point out in its
order, as to why in the facts and circumstances of the case it shall not
constitute 'unfair trade practice'.
laws intended to protect consumers, as opposed to traders, are comparatively of
recent development. Because of general lack of information on the part of
consumers, many trade practices may result in causing loss or damage to the
consumers. It is well known that many of the traders having advance
information, or on speculation regarding the rise in the price of 507 different
articles, in order to avail the increase in the price, withhold the supply of
different goods or articles to the consumers. In this process they cause loss
or damage to consumers by making them to pay the excess price which they would
not have been compelled to pay, if the goods or articles had been supplied in
time. The object and purpose of the Consumer Protection Act is to save the
consumer from such unfair conduct and practice of the traders also. On the
materials produced, the District Forum, the State Commission and the National
Commission have to examine the grievance of a consumer that by adopting an
unfair conduct or practice, a trader has wronged him and has compelled him to
pay an excess amount. But, at the same time, it need not be impressed that any
intervention, by such Consumer Forums, should be only when they are satisfied
that the loss or damage has been caused to the consumer by the unfair conduct
or practice, adopted by the trader.
From the Statement of Objects and Reasons of the Act, it appears that the
purpose of the Act is to protect the interest of the consumer and to provide
'the right, to seek redressal against unfair trade practices or unscrupulous
exploitation of consumers'. Section 2(1)(c)(i) defines the 'complaint' to mean
any allegation in writing made by a complainant that "as a result of any
unfair trade practice adopted by any trader, the complainant has suffered loss
or damage". Section 2(r) says the expression 'unfair trade practice' shall
have the same meaning as 'in Section 36-A of the Monopolies and Restrictive
Trade Practices Act, 1969 (54 of 1969)......
the Monopolies and Restrictive Trade Practices Act, 1969 (hereinafter referred
to as 'the MRTP Act'), several amendments have been introduced in Chapter V of
the said Act, including Part B which contains Section 36-A, by Act No. 30 of
1984 with effect from 1-8-1984. Section 36-A purported to define 'unfair trade
practice' and in different sub-clauses of the said section, many 'unfair trade
practices' have been specified. However, by Act No. 58 of 1991, amendment was
introduced in Section 36-A, to make it more comprehensive, so as to cover
within the definition of ,unfair trade practice' even unfair method or unfair
or deceptive practice adopted while promoting sales and supplying goods. The
relevant part of Section 36-A is as follows:
Definition of unfair trade practice.- In this Part, unless the context
otherwise requires, 'unfair trade practice' means a trade practice which, for
the purpose of promoting the sale, use or supply of any goods or for the
provisions of any services, [adopts any unfair method or unfair or deceptive
practice including any of the following practices], namely:
Permits the hoarding or destruction of goods, or refuses to sell the goods or
to make them available for sale, or to provide any service, if such hoarding or
destruction or refusal raises or tends to 508 raise or is intended to raise,
the cost of those or other similar goods or services." (emphasis supplied)
words "adopts any unfair method or unfair or deceptive practice including
any of the following practices" were introduced in Section 36-A by
aforesaid Act No. 58 of 1991 with effect from 27-9-1991. It appears that before the words "adopts any unfair
method or unfair or deceptive practice" were introduced in Section 36-A,
prima facie none of the practices specified in sub-section (1) to sub-section
(5) of Section 36-A, would have covered a case with which we are concerned i.e.
intentionally delaying the supply of articles or goods booked by the consumer,
according to the turn fixed, because of which the consumer suffers loss or damage.
Sub-section (5) was there, but it shall not apply to a case where the trader
delays the supply of the goods or the articles to a consumer, because of which
the consumer suffers an injury by rise of the price in the meantime.
(5) of Section 36-A will be attracted where the trader permits the hoarding or
destruction of goods, or refuses to sell the goods or to make them available
for sale, and because of such hoarding or destruction or refusal to sell,
raises or tends to raise the cost of those goods.
it is not the case of the appellant that the respondent was hoarding the
tractors or was refusing to sell them to anyone, and by this process was
tending to raise the price of the said tractor. The case of the appellant is
that the respondent was making delivery of the tractors on pick and choose
basis, ignoring the appellant whose turn was first on the list of persons, who
had booked the tractors with the respondent. The rise in the price of the
tractor is not connected with any hoarding or refusal to sell the tractors on
the part of the respondent. As such the conduct and the practice adopted by the
respondent in respect of the sale of the tractor to the appellant, shall not
fall under sub- section (5) of Section 36-A of the MRTP Act.
But after the introduction of the aforesaid amendment, which provides that the
'unfair trade practice', shall cover any unfair method or unfair or deceptive
practice adopted by a trader vis-a-vis the consumer, the conduct and practice
intentionally adopted by the respondent, in not making delivery of the tractor
to the appellant, shall certainly be deemed to be an ` unfair trade practice'
within the meaning of Section 36-A. It cannot be disputed that if a trader
intentionally delays the delivery of any goods to the consumer, because of
which the consumer suffers, it shall amount to an unfair method or unfair
practice adopted by the trader. As such after the introduction of the amendment
by the Act No. 58 of 1991 in Section 36-A, there should not be any difficulty
in holding that because of the unfair trade practice adopted by the respondent,
the appellant has suffered a loss and damage, within the meaning of Section 2(1)(c)(i)
of the Consumer Protection Act, in respect of which he can file a complaint. The
National Commission has pointed out that in the agreement, it had been
stipulated that appellant shall pay the price prevailing at the time of the
delivery. According to us, it is not of much consequence, once it is
established that respondent 509 intentionally postponed the delivery of the
tractor to the appellant, although he was not only entitled to the delivery
much earlier but, according to the findings of the District Forum and the State
Commission, he was throughout willing to take delivery of the tractor according
to the list of booking.
But there is another aspect of the dispute. The appellant booked with the
respondent for the supply of the tractor on 12-12-1990 and deposited an advance of Rs 2500.
respondent supplied the said tractor on 21-9-1991. But till 21-9-1991 i.e. the date of the supply of the tractor by the
respondent, the expression "adopts any unfair method or unfair or
deceptive practice" had not been introduced in Section 36-A. The Amending
Act 58 of 1991 introducing "unfair method or unfair or deceptive
practice" in the definition of 'unfair trade practice', came into force
with effect from 27-9-1991 i.e. after the tractor had been
supplied by the respondent. As Section 2(r) of the Consumer Protection Act
defines 'unfair trade practice' to mean the definition given in Section 36-A of
the MRTP Act, it is not open to this Court to interpret the said expression
without reference to Section 36-A of the MRTP Act. As such it has to be held
that the unfair method or unfair practice adopted by the respondent between
12-12-1990 and 21-9-1991, shall not be deemed to be 'unfair trade practice'
within the meaning of Section 36-A of the MRTP Act read with Section 2(r) of
the Consumer Protection Act. If the amendment introduced by Act No. 58 of 1991
in Section 36-A of the MRTP Act had come into force on any date prior to the
date of the delivery of the tractor, then there would have been no difficulty
in holding that by intentionally delaying the delivery of the tractor to the
appellant, the respondent had adopted an 'unfair trade practice'.
However, in view of Section 2(1)(c)(iii), 'complaint' will include any
allegation in writing made by a complainant that "the services mentioned
in the complaint suffer from deficiency in any respect". As such, even if
the complaint regarding the delayed supply of tractor, in the facts and
circumstances of the present case, may not be covered by Section 2(1)(c)(i)
aforesaid, it shall amount to deficiency in service by the respondent. The
definitions of 'deficiency' and 'service' given under Section 2(1)(g) and (o),
will cover the action of the respondent, in intentionally delaying the supply
of the tractor. In the facts and circumstances of the case, there should not be
any difficulty in holding that the service which was made available to the
appellant by the respondent, suffered from deficiency.
Accordingly, the appeal is allowed. The order of the National Commission is set
aside and that of State Commission is restored. However, in the facts and circumstances
of the case, there shall be no order as to costs.