State Consumer Disputes Redressal Commission
M/S Access Equipments, Gandhi Nagar, ... vs M/S Cuddapah Co-Operative Sugars ... on 7 February, 2012
A. P. STATE CONSUMER DISPUTES REDRESSAL COMMISSION : AT HYDERABAD FA 874/2009 against CC 96/2008 on the file of the District Consumer Forum, Kadapa. Between : M/s Access Equipments, Rep. by its Managing Director, Plot No. B8 & 9-1, Kukatpalli, Gandhinagar, Hyderabad. ..Appellant/ Respondent. And M/s Cuddapah Co-operative Sugars Limited, Rep. by its Managing Director, G. Sudarshan Babu, S/o Ramaiah, aged 42 years, Dowlatapuram, Chennur Mandal, Kadapa District. Respondent/ Complainant. Counsel for the Appellant : M/s. V. Venkat Kumar Counsel for the Respondent : remained absent. Coram ; Sri R. Lakshminarasimha Rao Honble Member
And Sri T. Ashok Kumar .. Honble Member Tuesday, The Seventh Day of February Two Thousand Twelve Oral Order : ( As per Sri T. Ashok Kumar , Honble Member ) ****
1. This is an appeal preferred by the unsuccessful opposite party as against the order dated 22.07.2009 in CC 96/2008 on the file of the District Consumer Forum, Kadapa. For convenience sake, the parties as arrayed in the complaint are referred to as under :
2. The brief facts of the complaint are as under :
The complainant purchased 5 ton capacity Cane Unloader from the opposite party under invoice dt. 9-11-2006 for Rs.34,77,992/- a corporate guarantee up to a period 31-3-2008. In response to the letter dt.16.11.2007 that the said equipment is not working properly due to some defects, representatives of the respondent visited and promised to rectify the defects like lifting equipment grab motor / gear coupling gear box problems, grab wire, rope bottom pulley sides was observed more gap and due to the defect wire ropes were got damaged, long travel was not functioning due to drive gear box / motor coupling problem and further advised to take up civil foundation works for rectification to the defects, end supporters column foundation, end support would be supplied in due course for erecting to arrest ogling.
Some more defects were also noticed like 1) Long travel gear boxes 2 Nos. 2) C.T. drive wheel bearings 2 Nos. 3) Wire rope got damaged 3 times. Total wire rope was renewed one time. 4) L.T railing alignment was improper causing heavy sound while L.T. Operation. 5) Structure columns were not full welded causing vibrations. 6) End supports were not provided. 7) Centre bay cross arms / supports were not provided. 8) Grab wire pullies were to be replaced to correct size causing struck up of wire rope frequently. 9) Motor guards to be provided and 10) L.T and C.T electrical contacts were damaged due to over heating. They were to be replaced with suitable capacity and rating contacts.
The respondent failed to fulfill the terms of purchase order that the crane shall be complete with its accessories, gantry, columns, attendant platform along with length of the gantry on both sides with 2 numbers of stair cases, Whereas the respondent had provided only one side attendant platform instead of both sides attendant platform causing inconvenience in maintenance of L.T/C.T drives. One Stair case was provided instead of two stair cases.
The complainant faced much difficulty to feed the cane into the carrier in peak hours. The complainant was forced to engage manual labour on every shift throughout the crushing season. The complainant sent a letter dt. 01-3-2008. But there was no response. The respondent had agreed to pay Rs. 10,00,000/- against any loss or damage caused or suffered by the purchaser by reason of any breach of any of the terms and conditions of the order. The respondent agreed that the purchaser should be sole judge to deal whether or not the seller had committed any breach of terms and conditions of the order to an extent of loss damaged, cost and expenses suffered by the purchaser. The complainant estimated the loss at Rs. 19,90,000/- under various heads. The complainant at last got issued a notice dt. 18-3-2008 to the opposite party to replace the defective cane unloader. The respondent failed to give reply or rectify the problems.
On 23-4-2008 the complainant again sent a letter demanding to pay Rs.10,00,000/- towards cost of material and labour costs. There was no response. Thus the complaint was filed to direct the Op to pay Rs. 19,90,000/- towards rectification of the defects of the Cane Unloader and cost of the material and labour cost and Rs. 2,000/- towards costs of the complaint.
3. The opposite party filed counter denying the allegations made in the complaint and disputing the claim of the complainant. The brief facts of the counter are as under :
The complainant was not a consumer within the definition of section 2 ( 1 ) (d) & (e) of the C.P. Act because the machinery supplied was for commercial activity, as per purchase order, the invoice and tender schedule. Any breach of contract between the parties the complainant had to approach the Civil Court. Thus the forum had no jurisdiction. As per clause 10 of the agreement / purchase order vide order No. CCS/ Cane Unloader / 2006, dt.
4-9-2006 and clause 24 of tender schedule if any disputes arose in between parties it would be referred to the Commissioner and Director of Sugar and Cane Commissioner, Government of Andhra Pradesh for arbitration. As per section 8 of Arbitration and Conciliation Act when there was any arbitration clause in the agreement, it had to be referred to the Arbitrator. There was no deficiency of service at any point of time because cane unloader was erected, installed and commissioned as per specifications designed approved by the complainant by following standards, specifications of 2004. There was no problem during crushing period of 2006-07. As per Clause 5 of the purchase order the machinery had to be maintained by the opposite party and accordingly the opposite party engaged and deputed a skilled technical person during crushing season 2006-07 and the machinery worked without any obstruction. After completion of the warranty the problems were rectified as and when arose and training was also provided to one of the persons of the complainant. As per clause 11 (c) of the purchase order the entire payment was paid by the complainant on the satisfactory work of cane unloader.
The warranty period was ceased by 16-8-2007. The cane unloader might have given problems during subsequent crushing season on account of mismanagement handling by the unskilled persons. It was not maintained properly without using lubricants. The machinery was not covered from sunlight or rains. The complaint was filed without any expert opinion regarding nature of damage. The loss of assessment could be done through a qualified competent person. The cost of equipment was Rs. 34,77,992/-. On his own statement the complainant assessed Rs. 10,00,000/- as cost of the material and labour charges.
The complainants company was sick and hence, the complaint was foisted with exaggerating amount as claim. As per the invoice supplied to the complainant it was mentioned that only the Hyderabad Courts had jurisdiction to entertain any dispute. The forum had no jurisdiction. The Government officials or Directors of the company were necessary parties to the proceedings and for non-joinder of the parties, the complaint ought to have been dismissed. The complainant was a registered company under Cooperative Societies Act and hence, he ought to have filed before the Cooperative Tribunal and thus prayed to dismiss the complaint.
4. The complainant and the OP. filed their respective Evidence affidavits reiterating their pleadings and A1 to A9 and Ex. B1 to B5 were marked respectively and RW1. and RW.2 were examined on behalf of the OPs.
5. Having heard both sides and on considering the material available on record, the District Forum allowed the complaint and directed the opposite party to pay Rs.13,90,000/- towards rectification charges for rectifying the defects of the cane Unloader and cost of the material and labour cost and Rs.1000/- towards costs within 60 days.
6. Aggrieved with the said order the opposite party preferred this appeal and mainly contending that District Forum ought to have dismissed the complaint on the ground of non-joinder of necessary parties to the proceedings and that since the contract between the parties is civil in nature and as the dispute is a not a consumer dispute, the consumer Forum has no jurisdiction and that the complaint is barred by limitation and that in view of Arbitration clause also the Consumer Forum has no, , the District Forum did not appreciate the evidence of RW.1 and RW.2 in correct manner and that impugned order was passed without there being any legal and dependable evidence against the OP and thus prayed to allow the appeal and set aside the impugned order.
7. Heard counsel for appellant and no arguments were advanced on behalf of the respondents/complainants.
8. Now the point for consideration is, whether the appellant/complainant is entitled for any enhancement of amount ?
There is no dispute in between the parties to the proceedings that the complainant society purchased 5 tons capacity of cane unloader from the OP under invoice dt. 9.11.2006 for Rs. 34,77,992/-.
One of the important contentions of the OP is that the complainant is not a consumer within the definition of sec. 2(1)(d) & (e ) of the CP Act because the machinery supplied by it to the complainant was for commercial purpose or activity and that if there is any breach of contract between the parties the recourse is available in Civil Court but not in Consumer Forum and that in the circumstances of the case the Consumer Forum has no jurisdiction to entertain the complaint but the same was not appreciated by the District Forum. On the other hand, the plea of the complainant is that it faced several problems in operating and utilizing the equipment even during the warranty period and that the Unit had several defects which could not be rectified and that the lapses on the part of the OP amount to deficiency in service and hence certainly the Consumer Forum has jurisdiction to entertain the complaint. In paras 18 and 19 under orders under appeal while discussing the ruling cited by both side the District Forum held that it had jurisdiction to entertain the complaint. In a latest decision The Honble Supreme Court in Birla Technologies Ltd. Vs. Neutral Glass and Allied Industries Ltd, reported in CDJ 2010 SC 1177 held that goods and services hired for commercial purposes cannot be the subject matter of a consumer complaint under the Consumer Protection Act. It set aside the judgment of the National Consumer Commission in the above decision , Birla Technologies Ltd vs Neutral Glass and Allied Industries Ltd. Birla Technologies developed software for Neutral Glass and later there were complaints about the modules. Neutral Glass moved the consumer commission. It held that though the company was not a consumer under the definition, since the complaint was lodged within the warranty period, it could get relief. Birla Technologies appealed to the Supreme Court. It stated that since the complainant used the goods and services for commercial purposes, its complaint was not maintainable. It is not contended by the complainant that the said machinery was purchased and used by it exclusively for the purpose of earning its livelihood by means of self employment. Since the opposite party herein is a Sugar Factory run by society there is no possibility of contending that the said machinery was purchased by it exclusively for the purpose of earning its livelihood by means of self-employment. Since the transaction is purely a commercial transaction it was excluded from the purview of the Consumer Protection Act and therefore we have no hesitation to hold that the Consumer Forum and this Commission has no jurisdiction to entertain the complaint ands thus the said aspect cuts the case of the complainant at the root level and therefore the complaint is liable to be dismissed on the said score alone and in such circumstances the impugned order is liable to be set aside on such a technical point. Certainly the complainant is at liberty to approach Civil Court for redressal.
9. According to the complainant the said equipment was fixed at its place by the OP with a corporate guarantee up to a period of 31.3.2008 where as the contention of the OP is that the warrantee period was ceased by 16.8.2007 and as seen from the Orders there is no answer in the said context by the District Forum. It is true that the OP filed a petition in IA 76/2009 to appoint a qualified engineer to investigate into the alleged defects in the equipment i.e., Cane Unloader regarding structural design, access and also its working condition and that the said IA was allowed on 31.3.2009 appointing the Chief Engineer, the Andhra Sugars Limited, Venkatarayapuram, Tanuku, West Godavari District as Commissioner. Thereafter, correspondence was made with the said Commissioner regarding his fee etc. and then the warrant was returned. Later on, the OP filed a memo dt. 16.4.009 requesting the Forum to appoint the Chief Engineer, Sudulagunta Sugars Ltd, Bucchinayudukandriga, Chittoor District as Commissioner. The commissioner aforesaid issued notice to the OP informing that he would visit the spot and inspect the equipment in dispute on 29.4.2009 for which the OP addressed a letter to the said Commissioner while marking a copy thereof to the District Forum that it was not possible for it to attend at the time of inspection on 29.4.2009 on the ground that the OP had to gather the structural consultant, mechanical designer and the advocate. It appears that no time was given to the op in the said context by the Commissioner. Even though the OP was a Sugar Factory there was no possibility of procuring the said technical personnel and its advocate for the said purpose within a short span of time and without giving sufficient time visiting the said spot and submitting Ex B1 report by the Commissioner/RW.1, certainly, amounts to violation of principles of natural justice. Taking into consideration of the convenience of both parties, their counsel and the said Commissioner the Forum should have fixed a date but did not do so and even without receiving the commissioners fee the said Commissioner visited the spot and submitted his report which indicates enthusiasm to submit a report without giving reasonable opportunity to the opposite parties. Merely because OP did not declare the said commissioner as hostile it is in no way helpful for the complainant in the said context. It is difficult to say that the RW.1 has no necessity to verify the tender schedule, structural design, mechanical design, civil design and electrical design before execution of the warrant because to come to a conclusion as to the defects pointed out by the complainant it was necessary for the commissioner to verify the same but no such opportunity was given by the commissioner in the instant case to the OP. Probably to over come the evidence of the RW. 1 if any in favor of the complainant OP sought permission vide orders in IA 136/2009 from the Forum to examine an independent witness ie RW.2 Thouskeq Anwer and he was partly examined. Later on a memo dt. 9.7.2009 was filed with a letter named as return of summons from RW.2 and in view of the said letter his evidence was closed and such a step taken by the District Forum was also not correct. It should have compelled the presence of the witness to give his entire evidence to appreciate the controversies in question in an effective manner. It appears that since RW.2 marked a copy of the said letter to the Forum to furnish the documents so that he would give the evidence and file his report it was so closed. Since he was not a Commissioner appointed by the District Forum he should not have addressed the Forum to furnish documents and he should have asked the OP to furnish the same but on such score it was not desirable to close the evidence of said witness and in that view point also the OP was deprived of proving his aspects agitated in the written version. In view of the above discussion the orders under Appeal is not sustainable and hence the same are liable to be set aside
10. In the result, the Appeal is allowed and the order of the District Forum under Appeal is set aside further observing that the complainant Cooperative Sugars Limited is at liberty to approach Civil Court for redressal if it so chooses. No order as to costs in the Appeal.
MEMBER MEMBER DATED : 07.02.2012.
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