National Consumer Disputes Redressal
Bull Machines Pvt. Ltd. vs Shri Mohanlal Patidar on 12 May, 2009
FA7212003 NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI FIRST APPEAL No. 721 OF 2003 (From the Order dated 13.08.2003 in CC No.73 of 2001 of the Madhya Pradesh State Consumer Disputes Redressal Commission, Bhopal) Bull Machines Pvt. Ltd. Rep. by its Manager (Marketing) S. F. No.663, Trichy Road Appellant Coimbatore 641 103 Tamil Nadu versus 1. Shri Mohanlal Patidar S/o Dayaramji Patidar Village Chhadawad Post Chhadawad Tehsil Tarana District Ujjain 456 665 Madhya Pradesh Respondents 2. The Proprietor New Holland Tractor 139, Chimanganj Mandi, Near Marketing Society, Ujjain, Madhya Pradesh 3. The Senior Manager (Service) New Holland Tractors Pvt. Ltd. 210, Okhla Industrial Area, Phase III New Delhi - 110020 FIRST APPEAL No.726 of 2003 (From the Order dated 13.08.2003 in CC No.73 of 2001 of the Madhya Pradesh State Consumer Disputes Redressal Commission, Bhopal) 1. New Holland Tractor India Pvt. Ltd. Appellant 52, Okhla Industrial Area, Phase III New Delhi 110020 versus 1. Shri Mohanlal Patidar S/o Dayaramji Patidar Village Chharavad Post Chharavad Tehsil Tarana District Ujjain 456 665 Madhya Pradesh 2. Manager (Marketing) Bull Machine Pvt. Ltd. Administrative Office S. F. No.663, Trichy Road Respondents Coimbatore 681103 Tamil Nadu 3. Proprietor, Shiv Om Tractors Authorised Dealer, New Holland Tractors 139, Chimanganj Mandi Near Marketing Society Ujjain, Madhya Pradesh BEFORE: HONBLE MR JUSTICE R. C. JAIN PRESIDING MEMBER HONBLE MR ANUPAM DASGUPTA MEMBER For the Appellant (F. A. No. 726 /2003) Ms Astha Tyagi and Ms Shuchi and Respondent No.2 (F. A. No. 721 /2003) Singh, Advocates For the Appellant (F. A. No. 721 /2003) Mr. S. Naidu Kumar, Advocate with Mr. Parivesh Singh, Advocate For the Respondent No.1 Ms. Bharati Arora, Advocate with Mr. Vikas Pai, Advocate Dated the 12th May 2009 ORDER
ANUPAM DASGUPTA These two appeals have been filed by the original opposite parties (OPs) 1 and 3 respectively against the order dated 13.08.2003 of the Madhya Pradesh State Consumer Disputes Redressal Commission (hereafter, the State Commission) in complaint case no 73/2001. By this order, the State Commission directed OP 1 (Bull Machine Private Limited appellant in F.A. no. 721 of 2003) to refund to the complainant (respondent no. 1 in both the appeals) the cost Rs. 4,40,220/- of the tractor-operated back-hoe and dozer supplied through its authorised dealer (OP 2 in the complaint before the State Commission) along with interest @ 12% per annum from the date of filing the complaint until payment. On the same lines, the State Commission directed OP 3 (New Holland Tractor India Private Limited) to refund to the complainant the cost of Rs. 6,10,850/- of the Ford 5630 tractor manufactured and supplied by OP 3 through OP 2, also authorised dealer of the said tractors, to the complainant with similar terms of interest. There was no order against OP 2, the common authorised dealer of both OP 1 and 3. For the sake of convenience, we refer hereafter to the parties according to their position before the State Commission.
2. The undisputed facts are that the complainant bought a Ford 5630 tractor of 70 HP manufactured and distributed by OP 3, through OP 2, at the cost of Rs. 6,10,850/-. The tractor was delivered to the complainant on 15.12.2000. He simultaneously bought the back-hoe and dozer (hereafter, the BHD) manufactured and distributed by OP 1, once again through OP 2, for Rs. 4,40,220/-. The BHD was delivered to the complainant a few days after the tractor. OP 2 informed the complainant that in addition to price paid as per the invoice the latter had to bear the cost of transportation of the BHD because, by an inadvertent error the invoice did not include that cost. The complainant took a loan from the Bank of India (BoI) for these purchases. The loan remained unpaid and the BoI consequently repossessed the tractor as well as the BHD and obtained (2005) a decree form the competent Debt Recovery Tribunal (DRT) for recovery of the entire outstanding loan and overdue interest along with interest pendente lite.
3. The complainants case before the State Commission was that OP 2 persuaded him, an agriculturist, to buy both the tractor and the BHD by explicitly and repeatedly representing that the said tractor and the BHD were fully compatible. The combination would make for a multipurpose machine capable of various agricultural and associated functions and thus enhance the returns from his investment. However, within 100 hours of operation with the BHD, the tractor developed several problems and could not be operated. There was leakage of oil from the trumpet housing of the tractor that, on complaint, was attended to by a mechanic of OP 2 but the problem continued. Even after subsequent repairs at the service centre of OP 2, the combination could work only for three hours. It became clear (and was admitted by OP 2) that the tractor was unable to take the load of the BHD. Despite promise to replace the tractor and the BHD within 15 days, the OP 2 did not do so. This led to loss of income @ Rs. 1000/- per day to the complainant. When pressed, after quite some time the OP 2 gave a standby set of tractor and BHD to the complainant to use for 2 months, assuring to have the machines replaced within that period. This was also not done. The complainant took up the matter with OP 1 directly but did not receive a satisfactory reply, as OP 1 contended that there was no manufacturing defect in the BHD and the defect appeared to be in the tractor housing. As a result, the complainant served a legal notice on the OPs and followed it up with a complaint before the State Commission. Apart from manufacturing defects in both the tractor and the BHD, he alleged unfair trade practices on the part of the OPs and sought refund of the price of the tractor and the BHD as well as compensation on various counts, amounting to Rs. 10.50 lakh, along with interest @ 2% per month on that amount. The complaint was contested by all the OPs on an array of grounds. As these grounds have been more or less repeated in their appeals, we take them up for discussion later. After considering the pleadings of the parties and the evidence brought on record (particularly the evidence affidavit of an insurance surveyor with mechanical engineering qualifications, produced by the complainant), the State Commission held the OPs 1 and 2 guilty on both the allegations and passed the order summarised above.
4. During the proceedings before this Commission, the BoI sought and was granted permission to intervene with the prayer that if any award was passed in favour of the complainant, the amount should not be released to him as he owed a large sum to the BoI. Considerable confusion was, however, created by the BoI and the complainant thereafter regarding the status of possession of the tractor and the BHD in the period after lodging of the complaint and the BoI issuing a notice to the complainant to seize the tractor and the BHD for failure to honour the debt service obligations. The BoI also took the matter to the DRT concerned, which decreed in its favour. Finally, after this Commission directed the District Consumer Disputes Redressal Forum, (in short, the District Forum), Ujjain to enquire into the matter that it became clear that the tractor and the BHD were in possession of the BoI and not OP 2 the dealer, as alleged all along by the complainant. By interim order of 30.07.2007 in writ petition no. 4112 of 2007 filed by the complainant, the High Court of Madhya Pradesh (Indore Bench) granted stay on the notice for auction of the complainants land for recovery of the outstanding loan, etc., of the BoI (flowing from order dated 27.10.2005 of the DRT, Indore) and also restrained the complainant from creating any third party charge on the said land, without permission of the High Court.
5. We have heard Mr. S. Naidu Kumar, learned counsel for OP 1; Ms. Astha Tyagi and Ms. Shuchi Singh, learned counsel for OP3; and Ms. Bharati Arora and Mr. Vikas Pai, learned counsel for the complainant and carefully considered the evidence and documents brought on record before the State Commission. During the final hearing, none was present for the BoI.
6. The learned counsel for both OP 1 and 3 have argued (as these OPs did before the State Commission) that the complainant was not a mere agriculturist and he had bought the tractorBHD combination for non-agricultural commercial purposes. He, therefore, did not fall within the definition of a consumer under the provisions of section 2(1) (d) of the Consumer Protection Act, 1986 and hence the complaint was not maintainable ab initio. On the other hand, it was the stand of the complainant before the State Commission that he was an agriculturist by profession and had bought the said combination of machines for his own agricultural purposes. Though the State Commission did not return a specific finding on this issue, the complainants stand is clearly vindicated by the DRTs order, which records, In the instant cases, taking stock of the circumstances and keeping in mind the drastic fall in the rate of interest all over and the loan being for agricultural purpose, [Emphasis supplied]. It is clear from the DRTs order that it took into account the complainants loan application a document much emphasised by the two OPs as proof of the complainant having applied to the BoI for a loan for commercial purpose.
7. The case of the OP 1 in its present appeal is almost the same as that before the State Commission. Mr. S. Naidu Kumar, learned counsel for OP 1 argued that OP 1 had no direct or indirect contact with the complainant until it received his order for the BHD through OP 2. Learned counsel took pains to point out that the problems faced by the complainant were due to defects in the tractor alone and not the BHD and it had accordingly advised the complainant to contact the tractor manufacturer. He further argued that the problem of leakage from the trumpet housing of the tractor experienced by the complainant was found by the internal staff of OP 2 to be on account of loosening of bolts. This, according to the learned counsel, was because of improper operation of the tractor by the complainant in not periodically tightening the bolts, as advised in the operating instructions of the tractor and also explained to the complainant by the maintenance staff of OP 2. He further challenged the validity of the technical opinion of one Sanjeev Srivastava (whose affidavit had been produced by the complainant before the State Commission as an expert opinion) - this was because the load of the BHD operation could not have been transferred to the tractor rear wheel assembly and differential housing because to operate the BHD on the power derived from the tractor, the rear wheels of the tractor had to be raised above the ground and rested on independent supports. The learned counsel also emphasised that though OP 2 was an agent of OP 1 in respect of BHD machines, the former had no authority under the agreement to make any representation on its own. Therefore, if OP 2, in any way, advised the complainant to buy the Ford 5630 tractor (manufactured by OP 3) and use the BHD in conjunction with that specific tractor for optimal performance, OP 2 exceeded its authority under the agreement with OP 1 and OP 1 could not be held responsible for such action of OP 2. In reply to a specific question, learned counsel Mr. Naidu Kumar reiterated that it was all along the stand of OP 1 that the BHD machine manufactured/marketed by OP 1 could be used with any tractor. Finally, he pointed out that though OP1 made a specific application to seek the opinion of an independent technically qualified commissioner on the issue of manufacturing defect in the BHD, the State Commission did not decide the application and instead went ahead with determination of the issue on its own. This was in violation of the provisions of section 13 of the Consumer Protection Act, 1986 (hereafter, the Act).
8. Ms. Tyagi, learned counsel for OP 3 argued that the complainant faced the alleged problems in operating the tractor (Ford 5630) because he operated the tractor in violation of the printed operating instructions supplied to the complainant by OP 2 at the time of sale of the tractor and also demonstrated to him by OP 2. She added that such loosening of bolts was a normal feature of operation of the tractor on agricultural fields and was required to be taken care of by the user through regular checking and tightening of the bolts after every 10 hours of continuous operation (vide instructions section 2 of the operating manual). She then referred to the job cards of the repairs carried out by OP 2 on receipt of complaints of the complainant about the tractors malfunctioning and pointed out that the jobs related mainly to loosening of bolts and consequent oil leakage from the tractor housing, which were carried out duly. According to her, the material on record clearly pointed to the alleged defects in the tractor being due to its improper operation by the complainant and not any manufacturing defect. She too pointed out the absence of any independent experts opinion on the question of manufacturing defect in the tractor.
9. On the other hand, Ms. Arora, learned counsel for the complainant argued that the stand of each of the three OPs was internally inconsistent and mutually contradictory. She pointed out that in its appeal memorandum itself, OP 1 stated, It has also been stated that appellants machine are running all over India without any problem, i.e., especially with New Holland Ford 5630 tractor. In addition, OP 1 enclosed some printed brochures of the operation of its BHD machine as annexure A-5 to the memorandum of appeal. These brochures clearly showed the BHD in operation with Ford tractor no.5630 as well as 3630. Notably, none of the brochures showed the said BHD in operation with any other tractor except John Deere 5310. Thirdly, though OP 1 had claimed that its BHD machines were running successfully all over India, it failed to produce before the State Commission even a short list of satisfied customers, leave alone an affidavit of any such customer in support of this contention. According to Ms. Arora, OP 2, being a common authorised dealer of both OP 1 and OP 3, made exaggerated representations, not on its own but on behalf of OP 1 and OP 3, to persuade the complainant to buy the combination of Ford 5630 tractor manufactured by OP 3 in conjunction with the BHD manufactured/marketed by OP 1. Neither OP 1 nor OP 3 furnished before the State Commission a copy of its respective agreement with OP 2 as an agent to prove that the relationship was not that of a principal and agent but that of principal and principal. In other words, if their common agent/dealer, OP 2 made certain specific representations about the performance of the BHD and the tractor in question, separately and in conjunction with each other, OP 1 and OP 3 were bound to meet those representations. The fact of persisting defects in the tractor and difficulties in operating the BHD in conjunction with the tractor (the tractor being unable to take the load of the BHD) would, according to Ms. Arora, show that there were manufacturing defects in both the machines and together they failed to perform as represented within just about 100 hours of operation. The fact of manufacturing defect in the tractor was further substantiated by the recurrence of the same problem despite the claims of OP 2 and the team of engineers of OP 3 of having specifically strengthened the bolts in early May 2001. Finally, according to the affidavit of Sanjeev Srivastava, a qualified mechanical engineer and insurance surveyor, operation of the BHD led to transference of load in excess of the designed capacity of the rear wheels and allied parts with differential housing of the tractor, because of which the housing got broken and this was a manufacturing defect, making the combination unworkable.
10. Before we proceed to consider the submissions of the learned counsel, we notice that one M. Natarajan, Manager, M/s Bull Machine Pvt. Ltd., Coimbatore filed an affidavit dated 15.11.2002 before the State Commission, in response to the evidence affidavit of Sanjeev Srivastava, whose affidavit was produced before the State Commission by the complainant. Natarajans affidavit averred that the BHD was manufactured only as an external fitting and designed to be attached any tractor. It added, As stated in my version, the housing is an integral part of the tractor and has nothing to do with the machines. Referring to the evidence of Sanjeev Srivastava, the affidavit also stated, The said deponent has totally erred in his opinion that due to load differential, the housing got broken which itself ipso facto proves that the defect is in the tractor and not with the machine supplied by M/s Bull Machines Pvt. Ltd. Finally, the affidavit stated, I submit that the combination of tractor and our machines is workable. It is noticed that this is more or less the essential case sought to be made out by the learned counsel for OP1.
11. The memorandum of appeal of OP 3, inter alia, claimed that the technical staff of the dealer, OP 2 attended to the tractor on 17.02.2001, 26.02 2001 and 03.05.2001. On 03.05.2001, improved grades of bolts along with lock plates, capable of withstanding heavy forces and impact were fitted in the tractor by the technical staff of OP 2. OP 3 claimed here that after these repairs, the bolts in the trumpet housing did not loosen up; they were actually pulled out. It is, however, doubtful if this last point was specifically averred before the State Commission at any stage. Secondly, though the appeal memorandum claimed that on 16.05.2001 the complainant wrote a letter to OP 2 expressing satisfaction that the tractor was running well, it went on to add that the tractor again came for tightening of bolts on 31.05.2001 whereupon a service team of OP 3 did a complete analysis and found that the problem was not on account of any manufacturing defect but operation of the tractor under severe conditions with loosened bolts. The appeal memorandum further claimed, the tractor could not bear the load on account of additional implement being the back hoe and that the problem of loosening of bolts may have developed due to the incompatibility of the additional machinery with the tractor. We further notice that according to its own admission, despite the vehemence of its claims of no manufacturing defect in the tractor and the problems being due entirely to the improper operation of the tractor by the complainant, OP 3 at one stage made efforts to amicably settle the matter.
12. It is thus clear that the above sets of claims of the OPs regarding absence of the alleged defects and deficiencies are not founded entirely on facts or their own averments. Both OP 1 and OP 3 had, in this case, a common authorised dealer, viz., OP 2. This would make sense only if the common objective of OP 1 and OP 3 was to sell the Ford 5630 tractor as well as the BHD in conjunction with each other. While OP 1 has taken pains to emphasise that the BHD manufactured/marketed by it in India is defect-free and fully compatible with any tractor, it refrains from clarifying the specifications of various compatible tractors, even the minimum power (HP) of such a tractor. The pre-printed publicity brochures on the BHD, produced by OP 1 itself, clearly point to its recommended use with Ford tractor 5630 or 3630 (of which the brochures show pictures). OP 1 further contends that the problem of leakage in the tractor housing due to loosening of the bolts was a problem with the tractor per se, in no way attributable to the BHD, which in any case was an external attachment to the tractor. On this ground, OP 1 also seeks to challenge the observations/opinion of Sanjeev Srivastava that the problem of leakage in tractor housing was due to the load of operating the BHD being higher than what the tractor was designed for. Yet, in its memorandum of appeal, OP 3 clearly states that the problem of repeated loosening of the bolts occurred not because of any manufacturing defects in the tractor but its operation under severe conditions, i.e., in conjunction with the additional machinery (BHD), which was incompatible with the tractor. In other words, this claim OP 3 supports the observations/opinion of Sanjeev Srivastava and completely negates the central stand of OP 1.
13. It is also clear from the proceedings before the State Commission that the complainant abandoned the tractor and the BHD at the premises/workshop/garage of OP 2 at some point of time before July 2001. According to the report of the District Forum, Ujjain (submitted under the directions of this Commission), the BoI was in possession of both the tractor and the BHD for long since it had them seized due to non-payment of the loan. These two pieces of equipment have thus not been in use since 2001. In the face of allegation of manufacturing defects in the tractor as well as the BHD and/or their incompatibility and specific applications of both OP 1 and OP 3 for independent expert opinion, it was indeed incumbent on the State Commission to seek an independent opinion on these allegations from a technically competent institution/organisation, in accordance with the provisions of section 13 (1) (c) of the Act. This should have been done at the earliest possible after filing of the complaint. However, the State Commission did not decide these applications and yet preferred to proceed with adjudication of the complaint merely on the strength of a short and somewhat inadequate opinion of a single person, viz., Sanjeev Srivastava whose affidavit was secured and produced by the complainant himself. Because of the long passage of time since the institution of the complaint, it is of no practical use to seek, at this stage, a fully competent, independent technical assessment of two pieces of equipment in respect of the allegations of manufacturing defects. Therefore, we are left with no alternative but to attempt a balance of equities in disposing of these appeals.
14. The question of manufacturing defect(s) in any of the two pieces of equipment, viz., Ford 5630 tractor and the back-hoe dozer, at the time of their sale to the complainant, cannot thus be re-determined conclusively in the present circumstances. However, the statements and averments of OP 1 and OP 2 on the issue of compatibility of these two machines in joint operation leave us in no doubt that the representations regarding compatibility of operation of the BHD with the tractor sold to the complainant is highly questionable. The complainant could not have, under any circumstances, bought both these pieces of equipment had it not been emphatically represented to him by OP 2, the common authorised dealer of OP 1 and OP 3. These two OPs would not have appointed a common authorised dealer if their common aim was not to sell these two machines in tandem. Moreover, we find it difficult to believe that this common dealer would have gone out of its way, despite no authority from OP 1 and OP 3, to make such strong recommendations to the complainant about compatibility of the two pieces of equipment. OP 1 and OP 3 seem to have fallen out after the State Commission passed the impugned order. This divergence in the stands of OP 1 and OP 3 becomes more pronounced in the averments/statements in their memoranda of appeal. In respect of the tractor, it has also been claimed that there was no manufacturing defect and the problem of repeated loosening of bolts and consequent leakage of oil had been resolved to the entire satisfaction of the complainant as early as on 03.05.2001. If that were so, there should have been no occasion for the tractor to be brought back for repairs again on 31.05.2001 according to the showing of OP 3 itself or for OP 3 to (admittedly) attempt an amicable settlement with the complainant after institution of the complaint. The conduct and stand of both OP 1 and OP 3 thus do not inspire confidence in the veracity of their respective submissions.
15. In conclusion, the impugned order cannot be sustained in its entirety because the finding regarding manufacturing defect in both the tractor and the back-hoe dozer sold to the complainant is not based on due appreciation of the evidence on record and is also not in accord with the mandatory provisions of the Act in respect of the procedure to be followed in determining such allegations. However, the facts and circumstances of the case, documents on record as well as the averments clearly point to both OP 1 and OP 3 having adopted unfair/deceptive trade practices, in terms of clause (r) section 2(1) of the Act. For this, the complainant would be entitled to a reasonable compensation. In our view, the ends of justice would be met adequately if OP 1 and OP3 were respectively directed to refund 50% of the cost of the back-hoe dozer machine and the tractor to the complainant. These two amounts add up to Rs. 5,25,535/-. On their respective shares out of this amount, both OP 1 and OP 3 shall also pay to the complainant interest @ 9% per annum from the date of institution of the complaint upto the date of actual payment. In addition, we direct OP 1 and OP 3 to each pay Rs.10,000/- to the complainant towards costs. These payments shall be made within four weeks from the date of this order, failing which the entire amount shall carry interest @ 12% per annum for the period of default.
...
[R. C. JAIN, J] .........................................
[ANUPAM DASGUPTA]