State Consumer Disputes Redressal Commission
Vihaan Direct Selling India Pvt. Ltd. vs Ravi Kumar And Another on 25 November, 2024
1
STATE CONSUMER DISPUTES REDRESSAL COMMISSION,
U.T., CHANDIGARH
(Additional Bench)
Appeal No. : 180 of 2024
Date of Institution : 02.05,2024
Date of Decision : 25.11.2024
Vihaan Direct Selling India Private Ltd., having its office at Ground Floor,
EI Block(Beech), Manyata Embassy Business Park, Outer Ring Road,
Bangalore-560045 (The present appeal is being filed through
Mr.Manjunath N, an authorized representative of Vihaan Direct Selling
India Pvt. Ltd.
... Appellant.
Versus
1. Ravi Kumar s/o Jagat Ram, R/o H.No.1022, Sector 35-B,
Chandigarh
2. Neeraj Mahajan s/o Sadhu Ram, R/o 1510/13, Deep Complex,
Hallo Majra, Chandigarh
..... Respondents
Appeal under Section 41 the Consumer Protection Act,2019
against order dated 23.01.2024 passed by District Consumer
Disputes Redressal Commission-I, U.T. Chandigarh in
Consumer Complaint No.640/2022.
For the appellant : Dr.Monika Thatai, Advocate
For respondent No.1 . Sh.Navneet Jindal, Advocate.
For respondent No.2 : Sh.Sunil Kumar Dahiya, Advocate.
__________________________________________________________
Appeal No. : 243 of 2024
Date of Institution : 20.06.2024
Date of Decision :
Neeraj Mahajan s/o Sadhu Ram having its address at 1510/13, Deep
Complex, Hallo Majra, Chandigarh
... Appellant.
Versus
1. Ravi Kumar s/o Jagat Ram, R/o H.No.1022, Sector 35-B,
Chandigarh
2. M/s QNET Ltd. C/o M/s Vihaan Direct Selling India Private Ltd.,
having its address/office at Ground Floor, EI Block(Beech),
Manyata Embassy Business Park, Outer Ring Road,
Bangalore-560045
..... Respondents
2
Appeal under Section 41 the Consumer Protection Act,2019
against order dated 23.01.2024 passed by District Consumer
Disputes Redressal Commission-I, U.T. Chandigarh in
Consumer Complaint No.640/2022.
For the appellant : Sh.Sunil Kumar Dahiya, Advocate.
For respondent No.1 . Sh.Navneet Jindal, Advocate.
For respondent No.2 : Dr.Monika Thatai, Advocate
BEFORE: MRS. PADMA PANDEY, PRESIDING MEMBER
Mr.PREETINDER SINGH,MEMBER PER PADMA PANDEY, PRESIDING MEMBER This order will dispose of aforementioned two appeals bearing Nos.180 of 2024 titled as Vihaan Direct Selling India Pvt. Ltd. Vs Ravi Kumar & another and A/243 of 2024 titled as Neeraj Mahajan Vs Ravi Kumar & another, both arising out of one and the common order dated 23.01.2024 passed by the District Consumer Disputes Redressal Forum-I, U.T.Chandigarh whereby complaint of the complainant Ravi Kumar was allowed partly in the following terms ;
"i) to refund an amount of Rs.6 lacs to the complainant alongwith interest @ 9% per annum from the date of filing of this complaint onwards.
ii. to pay an amount of Rs.30,000/- to the complainant as compensation for causing mental agony and harassment to her.
iii. to pay Rs.10,000/- to the complainant as costs of litigation.
This order be complied with by the OPs within 45 days from the date of receipt of its certified copy, failing which, they shall make the payment of the amounts mentioned at Sr.No.(i) & (ii) above, with interest @ 12% per annum from the date of this order, till realization, apart from compliance of direction at Sr.No.(iii) above 3
2. The facts are being taken from appeal No.180 of 2024 titled as Vihaan Direct Selling India Pvt. Ltd. Vs Ravi Kumar & another.
Briefly stated the facts of the case are that OP No.1(Neeraj Mahajan-respondent No.2) was the owner of M/s Sadhu Ram & Sons and was known to the complainant before the joining the QNET, due to some past business practices between the companies. It was averred that the complainant was contacted by OP No.1 telephonically and through zoom meeting several times, primarily for the commission based business, whose modus operandi as told was just through selling products-ecommerce called B2C Type Business and by showing a million potential outcome, to wrap up the thinking skills of the persons. The complainant, being a government employee refused to indulge in any such business practices but OP No.1 then being a trusted partner of the complainant, registered the same in the name of complainant's father-Sh.Jagat Ram. All the documents were sent to OP No.1 on whatsapp. The best amount suggested for investment was Rs.10.00 lakhs and upon opposing/restrictions, the amount was revised to Rs.6.00 lakhs as last amount. The complainant was told that the QNET in India is operating through Vihaan India Direct Selling Pvt. Ltd. The complainant took personal loan of Rs.6.00 lakhs from Punjab and Sind Bank and transferred Rs.4.00 lakhs in the account of OP NO.1 on 18.12.2021. Subsequently, he deposited another amount of Rs.2.00 lakhs in the account of OP No.1 on 19.12.2021. It was alleged that the biggest fraud was played in the form of breach of trust by OP No.1 by selecting the product from Global level and concealing the facts of 7 days refund period for global purchase. The purchase of products was made by OP NO.1 at his own level and no information was provided to 4 the complainant. The buyback period was shown to be 30 days and the same was also received from OP No.2/appellant through e-mail and laid in the policy and procedure of the company under Clause 4.08. However, the receipt was provided to the complainant for Rs.5.53 lakhs instead of Rs.6.00 lakhs. Subsequently, the complainant came to understand that the activities performed by the OPs were not fair in nature as serious irregularities were reported by the Department of Consumer Affairs against the Company-QNET. Whenever the complainant raised his query for the irregularities pointed out by various government departments, he was diverted from raising any such query. Being dissatisfied with the process and product, the complainant sought refund of the money as per 30 days buy back clause, but the same was rejected by OP No.2 on the ground that the period for refund was 7 days for global purchases. It was further averred that refund period of 7 days for the international purchases was never been told to the complainant. Alleging deficiency in service and unfair trade practice on the part of the OPs, the complainant filed a consumer complaint before the Ld. District Commission seeking directions to the OPs for refund of the deposited amount along with interest, compensation for mental agony and physical harassment as well as litigation expenses.
3. Pursuant to issuance of notice, the Opposite Parties appeared before the Ld. District Commission and contested the complaint. In their written statement, the Opposite Parties No.1 & 2 took certain preliminary objections inter alia stating therein that the complaint was not maintainable and the same was filed by concealing the material & true facts; the complaint was bad for non-joinder and mis-joinder of 5 necessary parties and that the complainant had not entered into any agreement with the OPs, instead, his father has entered into agreement with the OPs. It was stated that after a detailed discussion about the products i.e. QVI CLUB GOLD CLUB MEMBERSHIP, TRIPSAVR ADVANCE & VTUBE 12 MONTHS SUBSCRIPTION, the complainant agreed to purchase the same and also consented to the product purchase through email declaration. After his prior approval through email, the products were purchased. It was stated that all the documents were duly read over by the complainant before signing them using Adobe Fill & Sign application and sent the same to the company. It was further stated that since the complainant was a government employee, the product was sold in the name of the complainant's father, Sh.Jagat Ram, because he was unable to do the same in his own name. It was pleaded that the complainant was told that the QNET in India was operating through Vihaan India Direct Selling Pvt. Ltd. It was further stated that since it was a new portal to the complainant, he not being aware about the procedure to buy the products, requested OP No.1 to purchase on his behalf. It was further stated that the complainant was very well aware that since he was purchasing the products from Qnet World Estore, the refund policy was only for 7 days and not of 30 days. The complainant was also aware of the policies of the OPs. The OPs had a meeting with the complainant on 21.12.2021 in which there was a detailed discussion about the nature of the business, model of business, compensation plan, refund policy, details about the Company, its worldwide presence and affiliations. It was pleaded that there was no deficiency in service or unfair trade practice on the part of the Opposite Parties and a prayer was made for dismissal of the complaint. 6
4. On appraisal of the complaint, and the evidence adduced on record by the parties, Ld. Lower Commission allowed the complaint of the Complainant partly, as noted in the opening para of this order.
5. Aggrieved against the aforesaid order passed by the Ld. Lower Commission, Opposite Parties filed their respective appeals bearing No.180 of 2024 by Vihaan Direct Selling India Pvt. Ltd. and Appeal No.243/2024 by Sh.Neeraj Mahajan for setting aside the impugned order.
6. We have heard Counsel for the parties , and have gone through the evidence and record of the case with utmost care and circumspection.
7. It is case of the appellant/Vihaan Director Selling India Pvt. Ltd. that it is an e-commerce based direct selling company and it is a sub-franchisee of QNet Ltd., Hongkong, which is a one of the largest direct selling network groups in the world with a customer base of 60,00,000 in 150 countries and a portfolio of 80 products. The appellant sells various products in India such as water purifiers, nutritional products, jewellery , watches etc. 'Direct selling' refers to selling products and services directly to the end consumers without traditional retail shops and the products are sold through the appellant's salesmen or distributions namely Independent Representatives or IRs, who sell products to the customers and earn commissions on the conclusion of such sales. The Direct Selling business is conducted through direct personal presentations and demonstrations, usually in the homes or at offices or at mutually agreed places, as practiced worldwide. In the present case, respondent No.1/complainant had registered his father 7 Sh.Jagat Ram as an I.R., who is not a party to the complaint. On signing an agreement with the appellant in a format of a registration form, signed both electronically and physically, the appellant approves the application and an IR code is issued to the applicant which then becomes his identification of referral sales in the appellant's database, however, the Independent Representative acts in its individual capacity when selling the products and services. The only amount paid to an IR by the appellant is when a sale is transacted through him to a customer of his reference. All the policies and procedures of effecting a sale and the policies and principles that regulate the conduct of an IR are very clearly listed out and have to be adhered to by all the IRs. All the customers are also made aware by the appellant of these policies and principles including refund terms which any customer can exercise within 30 days of purchase and 7 days of purchase in case of international purchases. The appellant provides regular business training and conducts events for product training around the world to keep the IRs abreast about the latest product information and resources. In the present case, respondent No.1/complainant had registered his father Sh.Jagat Ram as an IR on 21.12.2021 on the basis of email sent by respondent inter-alia providing registration details of his father for the purpose of registering his father as a Distributor/I.R. of the appellant. Respondent No.1 also filled and executed a Distribution Application form and he was assigned a Distributor ID No.IN35001. The appellant's compensation structure is a sales-driven opportunity for additional income and is not driven or promoted for recruiting/membership or collecting money or equivalent. It is further case of the appellant that on 10.1.2022, the Global Support Team of Qnet Ltd. in pursuance of a query from respondent 8 No.1/complainant addressed an email to him inter-alia explaining that under the terms and conditions, expressly agreed upon by respondent No.1, the sale of the said Membership/Subscription was made. Through the said email, it was further explained that for a transaction made on 21.12.2022, a request for refund made by 8.1.2022, being the said purchase of Membership/subscription was international, could not be entertained. The only reason given by respondent No.1/complainant seeking refund was that the Membership/Subscription was purchased by respondent No.2 and not him and further in the email there was no allegation attributed about any imperfection, fault or discrepancy in the Membership/Subscription purchased. Thus, according to the appellant, the respondent No.1/complainant/his father falls within the definition of the term "Direct Seller" which means a person authorized by a direct selling entity through a legal enforceable written contract to undertake direct selling business on principal to principal basis, with ultimate objective of gaining profits out of their investment, which thus, excludes them from the definition of 'Consumer' under Section 2(7) of the Consumer Protection Act. In a way, it is a contractual dispute which can only be entertained by a civil court.
8. It is case of the appellant- Neeraj Mahajan in the second appeal that he was an Independent Representative of Vihaan Direct Selling India Pvt. Ltd. , which is a sub-franchisee of a company known as QNET Ltd. It was stated that he and respondent No.1/complainant were acquainted with each other. In November-December, 2021, discussions were held between them wherein respondent No.1 informed that he was actively exploring business investment opportunities but being government employee, he personally could not carry out any business. 9 After comprehensive discussion about the products offered by the appellant VDSIPL, complainant consented to purchase Qvi Club Goldclub Membership, Tripsavr Advance, and Vtube 12 months Subscription (Membership/Subscriptions) in the name of his father. It is further case of the appellant-Neeraj Mahajan that respondent No.1's father was a necessary party but the Ld. District Commission has not considered the said aspect as no General Power of Attorney or Authority letter was placed on record by respondent No.1 whilst filing the consumer complaint. It is further case of the appellant-Neeraj Mahajan that he purchased the Membership/Subscription on behalf of the father of respondent No.1/complainant and the Ld. District Commission did not consider that there was 7-day refund policy when purchasing products/services from Qnet World E-store. According to the appellant the Ld. District Commission failed to consider that respondent No.1/complainant has failed to prove any fault, imperfection, shortcoming, negligence or withholding of information attributable to the appellant.
9. The main controversy in this case is with regard to the period/time aspect for buy back the product/services of the appellant. According to respondent No.1/complainant as per point No.4.08 of Qnet Policies and procedure, the Buy Back period was mentioned 30 days. The date of purchase in this case was 21.12.2021 and date of request for return of the product and seeking refund was 8.1.2022. It is further case of respondent No.1 that on receipt of the product assuring travel packages, he read the terms and conditions available on the website and found that the same were very harsh as on each and every booking some fee was levied and there was heavy annual fee. As all 10 these charges were never told/disclosed to respondent No.1, he decided to return the said purchase. It is admitted case of the parties that the purchase was made on global platform. Respondent No.1 took up the plea in the consumer complaint before the Ld. District Commission in para-37 of his complaint that deadline of 7 days for applying refund was never told to him, which reads as under ;
"That respondent No.1( Respondent No.2 herein Neeraj Mahajan) told the complainant to focus on selection, afterwards everything will be looked by him. Upon his words, complainant kept on affirming all the facts. The faith of complainant on respondent No.1 made him to join QNET blindly, whose benefit all respondents took by concealing the correct facts and figures. The purchase was made on global platform and deadline of 7 days for applying refund was never told to the complainant nor the terms and conditions were in line with the guidelines of government of India. "
However, respondent No.1/complainant based his case on Clause 4.08Buy Back Policy of QNET Policies & Procures(Annexure A-
3) which reads as under;
"IRs are hereby notified that Products are subject to the Company's Buy back policy.
The Company shall be obliged to buy back any marketable products sold to the IR within (30) days from the date of delivery of the product/services by the Company, in accordance with its policies.
The Buy Back Policy is only applicable upon the return of physical products and shall only apply in conjunction with the IRs resignation requesrt, in accordance with Clause 8.01 below".11
"8.01-Resignation An IR may voluntarily resign from and/or terminate his/her IRship by tendering thirty(30) days written notice of such resignation or termination to the Company. Voluntary resignation and/or termination is effective upon the expiry of the thirty(30) day notice period."
Appendix-P-1 is copy of the printout of whatapp chat attached with the complaint by the complainant. On 21.12.2021, respondent No.1/complainant had a chat with Mr. Neeraj Mahajan, appellant, which is reproduced as under ;
"I have understood the plan and intend to enroll as a Distributor with Vihaan Direct Selling India Private Limited at my own will. I am enclosing herewith registration details of my father alongwith scanned copy of his PAN and AADHAAR card for ready reference.
------- I also want to purchase QVI CLUB-GOLD Club Membership, Tripsavr Advance & VTUBE 12 months Subscription. However, I am unable to make a transaction since my banker is not allowing me to do transactions due to limits on international transitions."
Hence, I am transferring Rs.6,00,000.00 (Rs.Six Lakhs only) to Mr.Neeraj Mahajan for the purpose of completing the process of purchase post registration on my own free will."
10. The product in question was purchased through Sh.Neeraj Mahajan, appellant, who clearly stated in his affidavit attached with the complaint that respondent No.1/complainant was made aware through detailed discussion that buy back period/refund policy was 7 days for purchasing the products from QNET World eStore. The Ld. District Commission has not considered the aspect that respondent 12 No.1/complainant purchased the product in question from Global platform for which buy back/refund period was 7 days.
11. In view of the above discussion, we find that the impugned order is not based on the correct appreciation of law and facts of the case and calls for interference of this Commission. Accordingly both the appeals are accepted and the impugned order is set aside. Resultantly, consumer complaint is dismissed.
12. All the pending applications in both the appeal also stand disposed off accordingly
13. Certified copies of this order be sent to the parties free of charge.
14. The file be consigned to Record Room, after completion.
Sd/-
(PADMA PANDEY) PRESIDING MEMBER Sd/-
(PREETINDER SINGH) MEMBER Pronounced 25th November,2024 Js 13 STATE CONSUMER DISPUTES REDRESSAL COMMISSION U.T. CHANDIGARH (Additional Bench) A/180/2024 Vihaan Direct Selling India Pvt. Ltd. Vs Ravi Kumar & another Argued by: For the appellant : Dr.Monika Thatai, Advocate For respondent No.1 . Sh.Navneet Jindal, Advocate. For respondent No.2 : Sh.Sunil Kumar Dahiya, Advocate. Dated, the 25th Novemdber,2024 ORDER Vide our detailed order of the even date, recorded separately, this Appeal alongwith appeal No.A/243/2024 titled Neeraj Mahajan Vs Ravi Kumar & another are accepted and consequently the impugned order of the Ld. Lower Commission is set aside. Resultantly, consumer complaint stands dismissed.
After compliance, file be consigned to record room.
(PADMA PANDEY) PRESIDING MEMBER (PREETINDER SINGH) MEMBER 14 STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T., CHANDIGARH (Additional Bench) Appeal No. : 243 of 2024 Date of Institution : 20.06.2024 Date of Decision : 25.11.2024 Neeraj Mahajan s/o Sadhu Ram having its address at 1510/13, Deep Complex, Hallo Majra, Chandigarh ... Appellant.
Versus
1. Ravi Kumar s/o Jagat Ram, R/o H.No.1022, Sector 35-B, Chandigarh
2. M/s QNET Ltd. C/o M/s Vihaan Direct Selling India Private Ltd., having its address/office at Ground Floor, EI Block(Beech), Manyata Embassy Business Park, Outer Ring Road, Bangalore-560045 ..... Respondents Appeal under Section 41 the Consumer Protection Act,2019 against order dated 23.01.2024 passed by District Consumer Disputes Redressal Commission-I, U.T. Chandigarh in Consumer Complaint No.640/2022.
For the appellant : Sh.Sunil Kumar Dahiya, Advocate. For respondent No.1 . Sh.Navneet Jindal, Advocate. For respondent No.2 : Dr.Monika Thatai, Advocate BEFORE: MRS. PADMA PANDEY, PRESIDING MEMBER Mr.PREETINDER SINGH,MEMBER PER PADMA PANDEY, PRESIDING MEMBER This appeal is accompanied by an application seeking condonation of delay of 103 days (as per office report 80 days) in filing the appeal. It is inter-alia stated therein that the appellant firstly filed Misc. Application seeking review of the impugned order before the Ld. District Commission and later on withdrew the same with liberty to file an appeal. The appellant then sought change in legal representation and as a result he had to search for a new advocate to represent him before this Commission and this entire process took time and hence, there was 15 delay in filing the appeal. The application is supported by an affidavit of the appellant.
2. Though the application seeking condonation of delay in filing the appeal was opposed by respondent No.1/complainant, yet in the interest of justice, keeping in view the contents of the application supported by duly sworn affidavit of the appellant, we allow the application and condone the delay in filing the appeal.
3. Vide our separate detailed order of the even date, recorded in Appeal bearing No.180 of 2024 titled as Vihaan Direct Selling India Pvt. Ltd. Vs Ravi Kumar & another, this appeal has been accepted and the impugned order has been set aside.
4. Certified copy of the order passed in Appeal bearing No. 180 of 2024, shall also be placed on this file.
5. Certified copies of this order, alongwith the main order passed in Appeal bearing No.180 of 2024, be sent to the parties, free of charge.
6. The file be consigned to Record Room, after completion.
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(PADMA PANDEY) PRESIDING MEMBER Sd/-
(PREETINDER SINGH) MEMBER