State Consumer Disputes Redressal Commission
Lok Raj Saini vs M/S Chinnamman Marketer Pvt. Ltd. on 1 August, 2006
H H.P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION SHIMLA O. Complaint No. 03/2003. Filed On 2.7.2003. Date of Decision 1.8.2006. Lok Raj Saini S/o Sh. Inder Dev, Village Sihan, P.O. Gagal, Tehsil Sadar, District Mandi, H.P., at present A Class Govt. Contractor, 197, Indira Market, Mandi, H.P. 175 001. .. Complainant. Versus. M/s Chinnamman Marketer Private Limited, through its Managing Director, Chinnamman Complex, 678, Chhennimalai Road, Perundurai-638052, Tamilnadu. . .. Opposite party (OP) _____________________________________________________________________ Honble Mr. Justice Arun Kumar Goel (Retd.), President. Honble Mr. Narinder Singh Thakur, Member. Honble Mrs. Saroj Sharma, Member. Whether Approved for reporting ? No. For the Complainant. Mr. Ratish Sharma Advocate, Vice Counsel for complainant. For the Opposite party. Mr. R.Ganesh Advocate and Mrs. Shilpa Sood, Advocates O R D E R :
Justice Arun Kumar Goel (Retd.) President.
Parties to this case entered into an agreement Annexure A-1 19.9.2002. As per this agreement OP was to supply certain machinery as detailed in it at a total cost of Rs. 65,48,000/-. Complainant was to make the payment as per schedule contained in it. Amongst other terms and conditions it was agreed between the parties, that the engineers of the OP were to do erect and commission the machinery at complainants site. He was to bear boarding and lodging expenses of this staff. In addition to this he was also to provide tools and equipments like crane, welding machine, diesel, oil, grease etc. for smooth erection work. Complainant was to do the civil work for Central Drum type Hot Mix Plant erection site as per OPs civil drawing before erecting the machinery. Machinery were to be erected upto 5.11.2002.
2. In addition to this OP was to execute a return registered agreement for guarantee for servicing upto 2 years in the Government registered office at Perundurai, Tamilnadu at the time of dispatch of the last machine. In the agreement details of the machines to be supplied alongwith cost, sales tax, CST, erection and commissioning charges were specified besides terms of payment and place of delivery. Machinery was to be delivered by the OP to the complainant at Mandi in Himachal Pradesh.
3. At the time of hearing of hearing, it was not disputed that except for the payment of Rs. 10,48,000/-, OP has received sum of Rs. 55 lacs, though not as per payment schedule contained in Annexure A-1. It is also clearly established from Annexure A-11 dated 20.12.2002, that the machinery was not erected upto 5.11.2002 and delay in this behalf was on the part of OP as is evident from Annexure A-11 which is extracted hereinbelow:-
December 20, 2002 To Mr. Lok Raj Saini, A Class Govt. Contractor, 197 Indira Market, Mundy Himachal Pradesh.
Dear Sir, Sub: Despatch - CHINNAMMAN CHP 939 Hydro Static Sensor Paver-Reg:-
We wish to inform you that we are going to dispatch CHINNAMMAN CHP-939 Hydrostatic Sensor Paver Finisher and CHINNAMMAN Model Bitumen Sprayer 1000 Liters capacity on 24th December, 2002 from our factory at Jugur, Perundurai, Erode. Our Managing Director Mr. S.D. Ramasamy will visit Mundi on 10th January 2003 for commissioning the machine.
We feel sorry for not dispatching the machines as per our earlier terms. This delay is mainly due to the delay in supply of Leyland Engine by the Ashok Leyland Company and delay in getting the Sensor Unit from Germony. We request you to kindly bear will us.
Regarding the LETTER OF CREDIT against the supply of this machine is time barred and we request you to make necessary amendment regarding the expiry date for dispatch and for negotiation in your bank and it would be helpful if you arrange to send your L.C. before the date of dispatch so as to submit to our bankers. Kindly treat this matter as most urgent. Sorry for the inconvenience caused in this regard. We assure you of our best service always.
Thanking you Ours Sincerely For CHINNAMMAN ROAD-TECH PRIVATE LIMITED Authorised Signatory.
4. It is also not in dispute that the sum of Rs. 15 lacs that was due and payable on 30.10.2002 was paid late by the complainant to the OP.
5. When there was delay in the delivery as well as erection and commissioning of machinery, the blame game started. According to complainant because of delay on the part of the OP, his work suffered, whereas according to the OP complainant did not get the letter of credit renewed and further stopped payment of the cheques which were due so far payment of Rs. 10,48,000/- was concerned. Per complainant he had agreed to purchase the machinery from the OP in terms of as well as in accordance with the schedule contained in Annexure A-I which the latter failed adhere to. Not only this, but he further pleaded that because of the plant in question not being erected/ commissioned on time, he had to hire two machines from other sources. With a view to support this plea he has placed on record Photostat copies of two agreements Annexure A-15 and A-16 to show that he paid hiring charges for these two machines i.e. Paver Bitalic Sensor at Rs. 2.5 lacs per month for two month and the Sensor Paver Appollo from another person also @ Rs. 2.5 per lacs month.
6. In this background the complainant has filed this complaint as according to him there was deficiency in service, therefore, he has prayed for refund of Rs. 55 lacs with 12% per annum till realization with future interest and Rs. 5 lac has been claimed by him as special and extraordinary cost on account of deficiency in service and unfair trade practice alongwith other monetary reliefs.
7. When put to notice stand of the OP is that the complaint is frivolous and unsustainable in law and it raised dispute beyond the scope and ambit of the Consumer Protection Act, 1986. Complainant was not a consumer as purchase of machinery was meant for commercial purposes, as such remedy under Consumer Protection Act, was not open to him. In addition to this disputes raised involved complicated questions of fact and law, only to be decided by the Civil Court. Machines were not purchased for self employment by the complainant. Parties had agreed that the disputes were only to decided by the courts at Perundurai and Erode who only have the jurisdiction, therefore Mandi Court has no jurisdiction. Delayed payments was raised as a ground for rejection of the complaint and cheques were got dishonored in the sum of Rs. 10,48,000/- which complainant is liable to pay to the OP. Execution of agreement A-I was admitted and also the receipt Rs. 55 lacs. Whole thrust of the reply of the OP was that delay was on the part of the complainant and Foras under the Consumer Protection Act, 1986 have no jurisdiction. In this background prayer was made for dismissal of the complaint.
8. Complainant filed his own affidavit by way of evidence, wherein amongst other things he stated that he is a Government Contractor and was earning his livelihood on Govt. contracts. He is a self employed person and for Govt. works undertaken by him he had to arrange for the machinery and other equipments so that the work is completed in a proper manner within the stipulated time span. Other facts set out in the complaint were reiterated by him. On the other hand there is no evidence placed on record by the OP, and even the reply to the complainant has also not supported with affidavit as per rules.
9. In the aforesaid background Mr. Ratish Sharma urged, that from Annexure A-11 extracted above it is clear that delay in supply of machinery is admitted by the OP. Per him all machines finally reached at Mandi on 11.2.2003 but erection/commissioning was not undertaken by the OP. Further according to him erection work was not completed and engineers deputed by the OP left the work mid-way, therefore machinery could not be operated. Agreement for service for two years was also not executed by the OP in terms of Annexure A-1. As such this is a clear cut case of deficiency in service and unfair trade practice adopted by the OP who after receipt of more than 80% payment did not fulfill the terms of Annexure A-I. Thus he prayed for refund of the amount besides interest and Rs. 5 lac for harassment and other monetary reliefs in view of Annexure A-15 and A-16. According to him there is enough material to allow this complaint on record to establish that deficiency was on the part of OP.
10. All these pleas were contested as well as controverted by learned counsel appearing for the OP who submitted that terms of agreement A-1 could not be fulfilled because of delayed payments being not made as per schedule contained in it. Payment that was due on 30.10.2002 was made on 13.6.2003 and the balance payment of Rs. 10,48,000/- was never made because the complainant had got the payments of the cheques for this sum stopped. As such delay cannot at all be attributed to his client. Further according to him there was no justification any whatsoever by stopping payment of cheques even in case of delayed delivery of the machines at Mandi, because admittedly the entire agreed machinery is in the custody of the complainant.
His client has been forced to initiate action for recovery of this amount. Non payment has further resulted in ruination of the OP. Regarding non erection/commissioning of the plant etc. he submitted that staff was deputed for doing the needful but for lack of providing electricity etc. and due to non completion of civil works by the complainant needful could not be done. Complainant was not a Consumer under Section 2 (1) (d) of the Consumer Protection Act, 1986 and there is not a murmur in the complaint to suggest that the machinery was purchased by the him for his self employment as well as for earning his livelihood and evidence produced in this behalf also does not spell out anything in this behalf. Disputed and complicated facts being involved in this case, therefore unless detailed enquiry was made after recording evidence, the dispute if any cannot be resolved. As such ordinary suit is the appropriate remedy. The fault being on the part of complainant and in this behalf he referred to the letters written by his client as detailed in the list of documents at the end of the reply to the complainant.
11. In the alternative and without in any manner either conceding the claim of the complainant or giving up the defences raised by his client, he submitted that complainant himself has admitted in paragraph 8 of the complaint that the Hotmix plant and Vibrator compressor were there to 50% capacity only and bitumen sprayer and the hydraulic sensor paver are not working at all which caused huge financial loss and mental harassment to the complainant. Thus according to him stand to the contrary of complainant is not correct as per own showing of the complainant.
12. We shall first deal with the plea of the OP that Courts at Perundurai and Erode only have the jurisdiction. A perusal of Annexure A-1, the agreement in terms of whereof machinery was to be supplied and payments were to be made there is no such condition contained in it. Its perusal further shows that it was executed at Mandi (H.P.), and was attested by the Notory Public at Mandi. Machinery was to be supplied at Mandi in the State of Himachal Pradesh. Return registered agreement for guarantee of service upto two years in Government Registered Office at Perundurai, Tamilnadu, was to be executed by the OP at the time of dispatch of the last machine as such how and what on basis jurisdiction of the Foras in the State of Himachal Pradesh is ousted is not spelt out from the agreement Annexure A-1. Nor could the learned counsel for OP point out anything for ouster of jurisdiction of Foras in H.P. Thus this plea is hereby rejected.
13. Complainant is not a consumer, therefore, this complaint was not maintainable. Reliance in this behalf was placed on a decision of the National Commission on behalf of OP in M/s Sakthi Engineering Works and Anr Versus M/s Sri Krishna Coir Rope Industry rep. by its Proprietor P. Krishnaiah, 2000 (3) CPR 33 (NC).
14 After having gone through this judgment we find that there is no material placed on record by the OP to controvert the evidence of the complainant that the machinery was intended to be purchased for earning his livelihood by him(i.e. the complainant), who was the self employed contractor and for carrying out the works he had to purchase the machinery. On an overall examination of the material before us, we are satisfied that the complainant is a consumer within the meaning of Section of 2 (1) (d) of the Consumer Protection Act, 1986 and decision of the National Commission relied upon to the contrary has no applicability to the facts of the present case. For taking this view we are supported by the decision in Dr. Vijay Parkash Goyal Versus The Network Limited, IV (2005) CPJ 206 NC. Complainant is thus held to be a consumer within the meaning of the Act of 1986, (Supra).
15. Next coming to the plea, that the complaint raises disputed and complicated questions of fact which can only be adjudicated by elaborate enquiry and evidence, therefore parties should go to Civil Court. In our considered view this plea does not hold good. Reason being that in terms of agreement Annexure A-I machinery was to be supplied and erected/commissioned at Mandi. Besides being erected and commissioned as per conditions contained in Annexure A-1. Entire machinery as per A-1 has admittedly reached Mandi but not in time.
16. Only plea raised by the OP is that complainant did not provide the necessary material in terms of Annexure A-I, nor did he complete the civil work for the erection of the plant. OP further claims that the staff was sent for doing the needful but for lapses on the part of the complainant they had to return without doing the needful. Staff of OP having come to Mandi for doing the needful is also established from record but could do the needful for non fulfillment of his part by the complainant, as per the OP.
17. After having considered the respective submissions urged on behalf of the parties we find that there is no complicated question of law and/or fact involved in this case. Entire machinery had reached though belatedly and reasons are given therefore by the OP. For the non payment of Rs. 10,48,000/- it was stated on behalf of the OP action has been initiated as per law before the appropriate Court in the State of Tamilnadu.
In these circumstances after receipt of more than 80% payment that too despite belated supply of the machinery it could not be commissioned, in these circumstances at best OP can make a grievance regarding the amount of Rs. 10,48,000/- for which admittedly action is pending in the Court. So we say nothing in this behalf. We may also mentions here that evidence produced by the complainant has remained un-rebutted.
18. Alternate plea urged on behalf of the OP in this case needs to be dealt with now. As already noted part of the machinery was operating at 50% and part of it did not operate at all. In these circumstances to say that the complainant is entitled for the refund of Rs. 55 lacs is not at all correct. When part of the machinery was operational at its 50% capacity and part was not operational, fact remains that the machinery is in possession of the complainant, question of refund of the entire amount of Rs. 55 lacs does not arise at all. Claim made in this behalf by the complainant is therefore rejected.
19. Another reason to take this view is that the complainant had admittedly withheld Rs. 10,48,000/- for non erection and commissioning of the machinery by respondent as is being claimed by him, after intimation to the OP he could have got it erected/commissioned at the cost and expense of the latter though the latter has contested this stand of the complainant as according to it erection and commissioning could not be done because of lapses on the part of the complainant. Moreover, the complainant still owed Rs. 10,48,000/- to the OP why this not done could not be explained on his behalf.
20. Stand of the complainant that he had to hire machinery from other sources vide Annexure A-15 and A-16 is supported from his evidence and there is no rebuttal to it. Annexures A-15 and A-16 only speak of agreements of hiring and receipt of Rs. 2.5 lac each to both these parties. Thus in these circumstances of this case it is felt that the complainant is only entitled for the refund of this amount i.e. Rs. 5 lacs only. Because receipt of this amount is admitted in Annexures P-15 and P-16. Whether there was any other payment made, there is no authentic evidence on record. There is no evidence of loss if any suffered by the complainant as alleged in the complaint. OP will also pay cost of this litigation quantified at Rs. 10,000/-. In addition to this if the payment is not made within 60 days of the receipt of this order, then the complainant will also be entitled to interest @ 6% per annum from the date of complaint i.e. 2.7.2003 till the date of deposit/payment whichever is earlier. Mr. Ratish Sharma and Mrs. Shilpa Sood Advocates be informed of this decision by the office.
Office will make available a copy of this order to the parties free of costs as per rules.
Shimla.
Ist August, 2006. (Justice Arun Kumar Goel )Retd.
President.
(Narinder Singh Thakur), Member.
(Saroj Sharma), Karan* Member.