State Consumer Disputes Redressal Commission
Shah Apartments And Developers Pvt. ... vs Volkswagen India Pvt. Ltd. on 13 March, 2023
FA NO./07/2016 D.O.D. 13.03.2023
SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS
IN THE DELHI STATE CONSUMER DISPUTES REDRESSAL
COMMISSION
Date of Institution: 06.01.2016
Date of hearing: 28.10.2022
Date of Decision: 13.03.2023
FIRST APPEAL NO.- 07/2016
IN THE MATTER OF
SHAH APARTMENTS AND DEVELOPERS PVT. LTD.,
B-136 PREET VIHAR,
DELHI-1100092,
THROUGH ITS DIRECTOR,
MR. RISHI SHAH.
(Through: Mr. Rohit Singh, Advocate)
...Appellant
VERSUS
1. VOLKSWAGEN INDIA PVT LTD,
MAKER MAXITY LEVEL 4,
3, NORTH AVENUE, BANDRA KURLA COMPLEX,
BANDRA (EAST),
MUMBAI- 400051, THROUGH CEO.
(Through: Mrs. Ekta Bhasin, Advocate)
2. THE GENERAL MANAGER,
BHASIN MOTORS,
N- 12, SOUTH EXTENSION PART-I,
NEW DELHI.
3. THE GENERAL MANAGER,
DHINGRA MOTORS, VOLKSWAGEN GURGAON
MILLENNIUM, KHASRA, VILLAGE- NARSINGPUR,
NH-8, NEAR HALDIRAM,
GURGAON, 122001.
...Respondents
ALLOWED PAGE 1 OF 15
FA NO./07/2016 D.O.D. 13.03.2023
SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS
CORAM:
HON'BLE JUSTICE SANGITA DHINGRA SEHGAL
(PRESIDENT)
HON'BLE MS. PINKI, MEMBER (JUDICIAL)
Present: Mr.Ankit Goyal, proxy counsel for Mr. Rohit Kumar
Singh, Counsel for the Appellant.
Mr. Sanidhya Sonthalia, proxy counsel for Ms. Ekta Bhasin,
Counsel for the Respondent no.1.
None for Respondent No.2 & 3 (proceeded ex-parte vide
order dated 19.4.2018)
PER: HON'BLE JUSTICE SANGITA DHINGRA SEHGAL,
PRESIDENT
JUDGMENT
1. The facts of the case as per the District Commission record are:
"The complaint has been filed with the allegation that the complainant company purchased the Volkswagen Polo Diesel 1.2 Trend line, Red Colour on 25/08/2011 from respondent No.2, for a sale consideration of Rs.6,06,930/-. The car was registered as DL7CK 9973. TATA Capital has given a loan of Rs. 4,00,000/- for the purchase of this vehicle and installment of Rs.8,949/- was being paid by the complainant. The car in question suffers from the manufacturing defects since the time its purchase. On 31/08/2011, just after covering 198 Km, problem with the display panel was noticed the indication of the Hand Brake was never turn off. It was taken to the respondent work shop, the job card was issued and the car was delivered next day claiming to be defect free. The ALLOWED PAGE 2 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS complainant is facing one problem after another and felt harassed. On 10/03/2012, the AC of the car broke down. The malfunctioning of the AC is accepted to be manufacturing defect. The complainant is dissatisfied with the services provided. On 07/08/2012, when the complainant has gone to Alvar he heard the noise from the engine. The helpline number was called, one Mr. Yogesh attended the call and Engineer arrived and inspected the engine. The display panel of the car did not show any indication of any kind of fault. The vehicle was tow away to Dhingra Motors in Gurgaon. The next day complainant was informed that there was no engine oil in the car and the engine has damaged due to lack of engine oil. He informed the official that the car never shows any indication about the absence of engine oil. The official accepted this fact that even today it did not show any signal of fault. The malfunctioning of the display panel was accepted and the respondent never been able to rectify the defect in the display panel. The respondent no. 2 asked the complainant to apply insurance claim instead of rectifying this defect. They refused to issue job sheet. The respondent no.3 knowing fully well that the car was in warranty and they still asking for the cost of the repair to be Bourne by the complainant. The complainant is suffering hardship in the absence of the car and has to travel in an auto and hire a cab to go out of station. In the above circumstances the complainant has prayed for the new car with no defect, be provided or in alternative the total amount of Rs 6,06,930/- with 18% interest be refunded with Rs 10,00,000/- damages and Rs 1,00,000/- as cost of litigation"
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SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS
2. The District Commission after taking into consideration the material available on record passed the order dated 28.10.2015, whereby it held as under:
"The respondent at the very offset have challenged the maintainability of this petition by the complainant company. It is content that petition is not covered under the definition of the consumer as define u/s 2 (d) of the Consumer Protection Act. The car in question was registered in the name of the company "a commercial entity" as such the petition is barred by section 2 (d) of the Consumer Protection Act and it deserves to be dismissed. The respondent relied upon General Motors India Pvt. Ltd. Vs G.S. Fertilizers Pvt. Ltd, in first appeal No.736/2006 delivered by the Hon'ble National Commission on 07/02/2013. On careful scrutiny of the judgment, we find that the fact of the present case is very much similar to the case of General Motors (supra), the car was purchased by the company for the use of his General Manager. The Hon'ble National Commission held that since the car was purchased by the company for the private use of the Managing Director it will be deemed to be for commercial purpose.
In the judgment of Lakshmi Engineering Works Vs. P.S.G. Industrial Institute [1995 (3) SCC 583] it was held that the car was not purchased by the Managing Director or General Manager for the purpose of augmentation of their income or as employment to earn his livelihood. We have carefully gone through the complaint, in Para 2 it is specifically mentioned that it was the complainant who ALLOWED PAGE 4 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS has purchased this vehicle, there is not a single averment in the entire complaint that it was purchased by any executive of the company for purposes of earning the livelihood in each of the paragraph, the word complainant has been used. The complainant in this case is commercial entity which cannot be covered u/s 2 (d) of Consumer Protection Act. The judgement of Hon'ble National Commission in first appeal No.7/2013 Belmaks Solutions Pvt. Ltd. Vs Skoda Auto India Pvt. Ltd has also been relied upon by the respondent wherein the Hon'ble National Commission has dismissed, the complaint relying upon the judgment of F.A. No.723/06 General Motors India Pvt. Ltd. (supra), in view of the National Commission Judgment, complainant is not covered by the definition of consumer as provided u/s 2 (d) of the Consumer Protection Act. It is further contended by the respondent that the vehicle when it was brought to their work shop, the oil sump was found damaged and there was not engine oil in the engine and no any warning signal found on. Since it was a case of the accidental damage, the vehicle was not covered under the warranty. The contention of the complainant is that it is a case of the defect in the panel of this vehicle. The indication of engine oil is not expected to be reflected on panel when the vehicle has suffered damage due to accident and there is no oil in the engine. It is further submitted that in such case when there is no oil there will be no display on the screen. The main contention of the complainant is that it is because of the fault of no display on the panel regarding the engine oil, the damage has been ALLOWED PAGE 5 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS cause to the vehicle. It is for the complainant to prove that the vehicle has not suffered any accidental damage and it was purely a failure of display on the panel, there is no evidence placed on record by the complainant that it is a case of failure of display. On the contrary the E-mail filed along with affidavit shows that the complainant was well aware regarding the damage to the engine because of the accident. Since it is a case a case of accidental damage, no deficiency of service can be attributed to the respondents nor it can be accepted that it was a manufacturing defect. We don‟t find any merit in the complaint, it is dismissed accordingly. Copy be served to both the parties as per rule"
3. Aggrieved by the aforesaid order of the District Commission, the Appellant has preferred the present Appeal contending that the District Commission has erred in establishing that the Appellant does not fall within the definition of a „consumer‟ as defined under Section 2 (d) of the Consumer Protection Act, 1986, and reliance has been placed on Karnataka Power Transmission Coproration & Ors vs Ashok Iron Works Pvt Ltd 2009 (3) SCC 240. Further, the Appellant contended that the District Commission erred in not appreciating the fact that the said car was having manufacturing defects such as noise coming from the engine, faulty air conditioner, etc. Moreover, the Appellant informed the Respondents about the said defects in the car and had to repeatedly send the car for repairs in the service centre on the Respondent, which was not repaired by the Respondent till date. Pressing the aforesaid ALLOWED PAGE 6 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS contentions, the Appellant prayed for setting aside the impugned order of the District Commission.
4. On the other hand, the Respondent no. 1, has filed the reply to the present appeal wherein he has contended that the Appellant did not give his consent for dismantling of the engine as the cost of repair could only be ascertained after the engine is dismantled. It is further contended that despite repeated reminders through E-mail the Appellant did not give his consent (Annexure 3 with the reply). Whereas, the Respondents no.2 & 3 have failed to appear despite being given multiple opportunities therefore, was proceeded ex-parte vide order dated 19.04.2018.
5. We have perused the material available on record and heard the parties at length.
6. The first question for consideration before us is whether the Appellant
- a Private Limited Company falls within the definition of consumer as defined under Section 2(1)(d) of the Act .To resolve this issue, we deem it appropriate to refer to Section 2 (1) (d) of Consumer Protection Act, 1986:
"Section 2(1)(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 ALLOWED PAGE 7 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS 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 who [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 [but does not include a person who avails of such services for any commercial purpose] Explanation - For the purpose of this clause, "commercial purpose" does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self- employment;
7. We also deem it appropriate to refer to Section 2(1)(m) of the Consumer Protection Act, 1986:
"person" includes:
(i) a firm whether registered or not
(ii) a Hindu undivided family
iii) a co-operative society;
(iv)every other association of persons whether registered under the societies Registration Act, 1860 (21 of 1860) or not.
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SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS
8. In this regard we deem it appropriate to refer to the decision of the Hon‟ble Supreme Court in Karnataka Power Transmission Coproration & Ors vs Ashok Iron Works Pvt Ltd 2009 (3) SCC 240 wherein the issue before the Supreme Court pertained to whether a private company purchasing electricity for commercial purpose can be included within the ambit of term „consumer‟ under the Consumer Protection Act. The Apex Court while delivering the judgment in favour of Ashok Iron Works Limited held that company is a consumer within the definition of Section 2(1)(d)(i) of Consumer Protection Act 1986 as under -
"Section 2(1)(m) which enumerates four categories namely, (i) a firm whether registered or not; (ii) a Hindu undivided family; (iii) a co- operative society; and (iv) every other association of persons whether registered under the Societies Registration Act, 1860 (21 of 1860) or not while defining `person' cannot be held to be restrictive and confined to these four categories as it is not said in terms that `person' shall mean one or other of the things which are enumerated, but that it shall `include' them.
18. Section 2(1)(m), is beyond all questions, an interpretation clause, and must have been intended by the Legislature to be taken into account in construing the expression `person' as it occurs in Section 2(1)(d). While defining `person' in Section 2(1)(m), the Legislature never intended to exclude a juristic person like company. As a matter of fact, the four categories by way of enumeration mentioned therein is indicative, categories (i), (ii) & (iv) being unincorporate and category (iii) corporate, of its intention to include body corporate as well as body un-
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SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS incorporate. The definition of `person' in Section 2(1)(m) is inclusive and not exhaustive. It does not appear to us to admit of any doubt that company is a person within the meaning of Section 2(1)(d) read with Section 2(1)(m) and we hold accordingly"
9. Therefore, the Hon‟be Apex Court has not left any room for confusion by widening the definition of "consumer" and has included within its ambit corporate bodies. Thus, we are of the view that it is an established position of law that a company can be a consumer and we answer this point accordingly in favour of the Appellant.
10. Further, it is also appropriate to refer to "View Tech Imaging Equipment Private Limited Vs. CMC Limited" reported in 2008 (2) CPJ 240 (NC), wherein the Honble National Commission held that equipment/car even if purchased for commercial purpose, buyer would be a Consumer if defects noticed during warranty are not rectified, the buyer would continue to be Consumer and shall be entitled to relief for deficiency of service. In Super Computer Centre Vs. Globiz Investment Private Limited reported in 2006 (3) CPJ 256 (NC) and In Amtrex Ambience Limited Vs. M/s. Alpha Radios reported in (1996) CPJ 324 (NC), wherein the Honble National Commission held as follows :
" the purchaser of machinery will certainly be a Consumer in respect of defect in machinery during the period of warranty. Since defect in machine in question was brought to the notice of petitioner within three months period of purchase the respondent will be a Consumer even though the machine was purchased for commercial purpose."
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SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS Following the above decisions, we are of the opinion that as the defect was noticed during the warranty and not rectified, the buyer would continue to be consumer and entitled for relief, even though the product in question was purchased for commercial purpose. In the present case, the Respondent No.1has not filed any evidence to show whether the car was being used for commercial activity or for the purposes of the company for meeting its daily requirements. As there is no any such evidence on record, inference can be drawn that the car was being used for dealing in Appellant‟s day to day affairs only. The Respondent No.1/Opposite Party No.1 has merely made a statement that the Appellant/Complainant purchased the said car for commercial gains and on perusal of the record before us; we fail to find any material which shows that the Appellant/Complainant has purchased the said car for commercial purpose. Therefore, it is clear that the Appellant/Complainant had bought the said car for the purposes of catering to the day to day affairs of the company. Mere allegation, that the purchase of the car is for commercial purpose, cannot be the ground to reject the present consumer appeal.
11. The main question for consideration before us is whether the Respondents were actually deficient in providing its services to the Appellant.
12. On a perusal of the record it is clear that the Appellant/Complainant got delivery of the car on 25.8.2011. Thereafter, the first defect in the car relating to Handbrake indicator in the display was noticed by the Appellant on 31.8.2011 i.e. just after 5 days of the delivery, as is evident from the Job Card dated 31.8.2011 (Annexure A-4 with the present ALLOWED PAGE 11 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS appeal) issued by the Respondent. On 10.3.2012 another problem was encountered pertaining to the Air Conditioner of the car, as reflected in the Job Card dated 10.3.2012 (Annexure A-5 with the present appeal). It is to be noted that the Appellant was given assurances of defect removal time and again yet his car broke down again for the third time on 7.8.2012 and thereafter the Appellant came to know that the engine and oil sump defaulted. Again, the Appellant bought this default to the notice of the Respondents via e-mail dated 8.8.2012 and on 9.9.2012 went to the workshop where he was at first refused the Job Card by the officials of the Respondents. The defect on third occasion pertaining to noise in the engine on starting-up and engine oil leakage is reflected in the Job Card dated 8.8.2012 (Annexure A-7 with the present appeal). It is important to note that the Respondents asked for the consent of the Appellant to dismantle the engine as the fault could only be assessed after the engine could be dismantled, to which the Appellant withheld his consent since the car was only a couple of months old.
13. Firstly, we deem it appropriate to refer, Hyundai Motors India Ltd V's Affiliated East West Press I (2008) CRJ 19 NC wherein in similar circumstances the Hon'ble National Commission observed as under- The question which arises for consideration in this case is luxury car namely Accent Car CRD diesel model, gives trouble within if a one or two months of its purchase, would the consumer be satisfied with such a car? Whether the multi- national company such a car, Le justified in not replacing the ALLOWED PAGE 12 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS manufacturing car or refunding purchase price and instead engaging in protracted litigation.?
In our view, if a brand new car gives trouble within a few days of its purchase, the consumer would be dissatisfied. such cases, the manufacturing company Further, in not justified in protracting litigation merely because it has the money power. Further a person who purchases a vehicle may be a luxury accent car or a small car, would not be satisfied if it is a defective vehicle. That the defect may not be a major one but the consumer loses satisfaction of having a new car. That loss of satisfaction would be much more in a case when the person buys the vehicle with his hard-earned money. Unfortunately, we have not developed the tendency of accepting the defects or defaults, By some measure or means, the tendency to accept the defects or defaults is required to be encouraged. Otherwise, delay in disposal of such cases defeats the rights and the consumer geta frustrated. On occasions, litigation is dragged on for taking undue advantage of delay in disposal.
The commission held as under:-
Undisputedly. all the multi-national companies have adopted aggressive marketing for the sale of vehicles. Unfortunately, we have developed a practice/ tendency of not admitting the defects in the vehicle and not replacing the same without contest. In other countries even if there is aggressive marketing, defective vehicles are easily replaced. That practice is required to be adopted at ALLOWED PAGE 13 OF 15 FA NO./07/2016 D.O.D. 13.03.2023 SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS least, by the big companies like the petitioner herein. Instead of disputing the undisputed facts, the companies should resolve the matter by replacing the vehicles.
14. From the aforesaid pronouncement, it is clear that any consumer shall be dissatisfied in services from a multinational company if the car purchased, started giving problems or have defects in it within one or two months from the date of purchase of the said car.
15. It is pertinent to mention here that the said car of the Appellant had defects in it within the very first month from the date of purchase i.e. 25.08.2011 and is also evident from the Job Card dated 31.8.2011 (Annexure A-4) issued by the Respondent. Moreover, the Appellant faced issues in the car in just 198 kms of running which indicates towards the manufacturing defects in the car.
16. We are of the considered view that the Appellant/Complainant has suffered lot of inconvenience and misery due to improper functioning of the vehicle right from the month of purchase. No purchaser of a new vehicle would ever think that he would be going to garage/service station to get the vehicle repaired so often even if the repairs may be minor.
17. Therefore, we set aside the order dated 20.02.2017 passed by the District Consumer Dispute Redressal Forum-VII, Sheikh Sarai, New Delhi- 110017. Consequently the present appeal is allowed.
18. Keeping in view the facts of the present case and the extensive law as discussed above, we direct the Respondent No.1/Opposite Party No.1:
A. "To replace the vehicle of the Appellant with the new vehicle within two months from the date of present Judgment.
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SHAH APARTMENTS AND DEVELOPERS PVT LTD VS VOLKSWAGEN INDIA PVT LTD & ORS B. Pay to the Appellant/Complainant a sum of Rs.1,00,000/- as compensation for mental agony and harassment suffered by him.
C. Pay to the Appellant/Complainant a sum of Rs.50,000/- as cost of litigation."
19. Application(s) pending, if any, stand disposed of in terms of the aforesaid Judgment.
20. A copy of this judgment be provided to all the parties free of cost as mandated by the Consumer Protection Regulations, 2005. The judgment be uploaded forthwith on the website of the Commission for the perusal of the parties.
21. File be consigned to record room along with a copy of this Judgment.
(JUSTICE SANGITA DHINGRA SEHGAL) PRESIDENT (PINKI) MEMBER (JUDICIAL) Pronounced On:
13.03.2023 ALLOWED PAGE 15 OF 15