State Consumer Disputes Redressal Commission
Manjulakshmi,Proprietor,Sivakasi vs Rafa M.Amala, Kanyakumari Dist. on 16 September, 2020
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BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI
PRESENT: Hon'ble Dr. Justice S.TAMILVANAN PRESIDENT
Mr.K.BASKARAN JUDICIAL MEMBER
Mrs.Dr.S.M.LATHA MAHESWARI MEMBER F.A.NO. 79/2015 (Against the order made in C.C.No,35/2011, dated 21.07.2015 on the file of the District Consumer Disputes Redressal Forum, Virudhunagar @ Sriviliputtur, and in view of different orders passed by the Members of the Circuit Bench,Madurai, the appeal has been referred to the Hon'ble President of the State Commission under sec 16 (1B)iii of the Consumer Protection Act) WEDNESDAY, THE 16th DAY OF SEPTEMBER 2020 Mrs.Manjulakshmi, Proprietrix M/s. Maruthi Tech No.178-K, Thiruthangal Road, Karnesan, Sivakasi.
NO.220/244, Marishavori Shopping Complex, Sivakasi - 626 123. Appellant/Opposite party Vs. Mrs. Rafa M.Amala, W/o C. Kamala Kannan, No.4/116-2C, Colony, Valluvar Street, Gnanam Nagar, Nagarcoil Town, Agastheeswaram Taluk, Kanyakumari District. Respondent/Complainant Counsel for the Appellant/Oppoite party : M/s. K,K.Samy, Advocates. Counsel for Respondent/Complainant : M/s. G. Prakash Edmin Kumar Advocates.
This appeal, filed under sec.15 read with sec.17(1)(a)ii of the Consumer Protection Act, came up before the Principal Bench of the, Tamil Nadu State Consumer Disputes Redressal Commission, Chennai finally on 07.09.2020. As the members of the Circuit Bench, Madurai have taken different views, the matter has been referred to the Hon'ble President of the State Commission. Based on the memos filed by both the Learned Counsel, perusing the evidence on record, the impugned order and the other materials, the Full Bench constituted by the Hon'ble President of the State Commission, at Chennai passed the following, 2 ORDER.
Hon'ble Dr. Justice S. TAMILVANAN The appeal was decided earlier by Judicial Member Mr.N.Rajasekar and non Judicial Member Mr.S.M.Murugesshan and separate orders were passed by them on 27.12.2019 at the Circuit Bench, Madurai, whereby the Judicial Member Circuit Bench allowed the appeal and set aside the impugned order date 21.07.2015 made in CC.No.35/2011on the file of the District Forum Virudhunagar, @ Sriviliputhur, whereas the non-judicial member of the Circuit Bench, confirmed the impungned order passed by the District Forum and dismissed the appeal. In view of the different orders being passed by the members, of the Circuit Bench the matter is placed before the President of the State Commission at the Principal Bench, Chennai to decide the same as per sec.16(1B)iii of the Consumer Protection Act. In view of the same, the President of the State Commission, Constituted the Full Bench, consisting of the President, Judicial Member Mr.K.Baskaran and the Non-Judicial Member Mrs.Dr. Latha Maheswari of the Principal Bench at Chennai, to decide this appeal, accordingly the appeal is decided.
Due to the pandemic situation, both the advocates could not appear before the principal Bench at Chennai, hence the matter was posted for hearing further arguments, if any by Video Conferencing. However both the Learned Counsel have filed separate memos dated 3.09.2020, requesting, the State Commission, to pass the order based on the materials available on record. Accordingly on considering the materials on record, written arguments and the orders passed by the District Forum and also the separate 3 orders passed by both members at the Circuit Bench Madurai, the Full Bench of the State Commission at Chennai made this order.
(1) The factual matrix of the consumer complaint:
The factual matrix of the consumer complaint, which has given rise to the present appeal is as follows. The Respondent/Complainant had filed the complaint against the opposite party before the District Forum stating that the complainant, for the purpose of starting business as her self employment had approached the Appellant / opposite party in order to purchase an Automatic Paper Cup Making Machine. Accordingly the complainant had placed an order for purchasing an Automatic Paper Cup Making Machine, model No:MT 750 and made an advance payment of Rs.50,000/- on 25.05.2011 by cheque and that was encashed by the opposite party by 01.06.2011, then the complainant entered into an agreement with the opposite party on 15.06.2011 at Nagarkovil and on the very same date, the complainant paid the balance amount of Rs.5,40,000/- towards the purchase of the said Automatic Paper Cup Making Machine. Acknowledging the same the opposite party issued receipt for the payment in favour of the complainant, in the form of proforma invoice. The opposite party had assured that the machine would be delivered within 30 days from the date of payment. However the machine was not delivered by the opposite party to the complainant as promised. Subsequently, the opposite party promised to deliver the machine on or before 05.09.2011, otherwise to return the full amount received from the complainant with interest. The complainant sent a telegram to the opposite party demanding delivery of the machine on or before 05.09.2011 without further delay. As the opposite party did not deliver the machine as promised, the complainant issued a Pre- suit legal Notice on 07.09.2011 and the same was returned unserved with an 4 endorsement "No such door Number" in existence. The complainant has stated that the non delivery of the machine by the opposite party is only deficiency of service and the opposite party has also committed unfair trade practice as per the Consumer Protection Act. Therefore the complainant filed the complaint seeking direction against the opposite party, to return the money Rs.5,90,000/- paid by the complainant with interest and also to pay a sum of Rs.1,00,000 as compensation for mental agony and other sufferings, with subsequent interest at 12% p.a., in favour of the complainant. (2). The opposite party filed Written Version before the District Forum, stating that the complaint itself was not legally sustainable and according to the opposite party the transaction between the complainant and opposite party is commercial in nature and also raised a question relating to territorial Jurisdiction of the District Forum. The said plea was negatived by the District Forum as per order passed in CMP.No.26/2012 dated 07.03.2013, which has reached its finality. Having considered the same, both the learned members of the Circuit Bench have concurrently upheld the view of the District Forum holding that the District Forum has got Jurisdiction to decide the Consumer complaint. Therefore the appellant/opposite party, is not entitled to reopen and re-agitate the question of Jurisdiction of the District Forum in this appeal. Having considered the material papers, the impugned order passed by the District Forum and the separate orders passed by the members of the Circuit Bench Madurai, the following points are arising for our consideration.
5(3). Points for determination:
1. Whether the appellant/opposite party has committed deficiency in service and adopted unfair trade practice as decided by the District Forum and the non-Judicial Member of the Circuit Bench, Madurai, in his separate order?
2. Whether the order passed by the District Forum is not legally sustainable as decided by the Judicial Member of the Circuit Bench, Madurai?
3. What reliefs the parties are entitled to?
Both Learned Judicial and non Judicial Members have framed the aforesaid points for consideration and also discussed the points but with different conclusions.
For the sake of convenience and brevity, the parties are referred to in this appeal as they were arrayed in the Consumer complaint before the District Forum. (4). Point No.1 As per the impugned order dated 21.07.2015, the District Consumer Disputes Redressal Forum, Virudhunagar @ Sriviliputtur has held that there is deficiency of service as well as unfair trade practice on the part of the opposite party. The learned Non-Judicial member of the Circuit Bench, Madurai by his separate order dated 27.12.2019 has also discussed the points, and decided that there is deficiency of service and unfair trade practice committed by the appellant/Opposite party. On a perusal of the materials on record, we are of the view that it is a clear case to decide the points for determination based on the evidence available on record. As per Ex.A2, proforma invoice dated 15.06.2011, the cost of Automatic paper cup making machine is stated as Rs.5,90,000/- out 6 of which Rs.50,000/- was already paid by cheque and the same was encashed by the opposite party. On 15.06.2011 the complainant paid Rs.5,40,000/- and totally the entire cost of the Automatic paper cup making machine Rs.5,90,000/- was paid by the complainant to the opposite party as evidenced by Ex.A1 and Ex.A2, which are admitted documents of both the parties. It is further clear that as per the Ex.A1 and A2 the complainant had to pay only VAT @ 4% which is calculated at Rs.23,600/- and service tax at 10.3% i.e., Rs.515/-. Further, it can not be disputed that VAT and Service Tax are payable only to the Government, on the date of sale, by the purchaser namely the complainant herein, through the seller, the opposite party. The amounts towards VAT and service tax need not be paid well in advance to the seller, so as to enable the seller to keep the money by herself. The VAT @ 4% and the Service Tax are payable only on the date of sale. As stated in Ex.A1 and A2, within 30 days after the date of payment, 15.06.2011 the opposite party has to deliver the Automatic paper cup making machine to the complainant and the amount towards VAT and Service Tax has to be paid on the date of sale / date of delivery of the machine. After getting the amount Rs.5,90,000/- the entire cost of the machine from the complainant, the opposite party is not entitled to cause delay, in making the delivery of the machine, stating that VAT and Service Tax were not paid before the date of delivery of the machine as if the non payment of VAT and Service Tax caused the delay. It is well settled that tax has to be collected by the seller, the opposite party herein, only at the time of sale, which is the time of delivery of the machine. In fact VAT or Service Tax need not be paid by the purchaser before the date of sale / Delivery of goods. Ex.A3 is the letter addressed by the opposite party to the complainant, which 7 reads as follows "As per the telephone conversation regarding paper cup machine on 12.08.2011. we supply the machine on or before 5 th September 2011 otherwise I will return you the full amount i.e., Rs.5,90,000/- (five lakhs and ninety thousand)"
(5). The opposite party's letter Ex.A3, clearly reveals the fact that the opposite party has admitted that the Automatic paper cup making machine was not supplied by the opposite party within 30 days after the date of payment, 15.06.2011, though the entire amount of Rs.5,90,000/- towards the cost of the machine was received by the opposite party from the complainant. In Ex.A3 & A4 letters, the opposite party has never stated that she was ready to deliver the machine, but sought only further time from the complainant up to 5th September 2011, and also assured that the opposite party would return the amount Rs.5,90,000/- already received from the complainant, if it was not possible for her to deliver the machine to the complainant on or before the said date, 05.09.2011. Having admitted the facts clearly in Ex.A3 letters the opposite party is legally estopped from raising a different plea stating that the complainant has caused delay by raising an unreasonable and unsustainable plea that the complainant had to pay balance amount against her own admission made by the opposite party in Ex.A3.
(6). The plea raised by the opposite party is against the admitted facts by her. Ex.A3 letter is a clinching evidence as discussed earlier that the entire amount of sale consideration, Rs.5,90,000/- was paid to the opposite party by the complainant on 8 15.06.2011 itself. Only VAT and Service Tax had to be paid and that could be paid only on the date of sale. It being the machine, a movable property, the date of delivery of the machine to the complainant is the date of sale and hence the complainant had to pay the tax only on the date of sale. Ex.A5 is the certified copy of the Telegram issued by the Telegraph Department which shows that on 17.08.2011, the complainant sent the Telegram stating that she had paid the full amount for the machine on 15.06.2011, but the opposite party failed to deliver the machine within 30 days and also asked the opposite party to deliver the machine on or before 05.09.2011 failing which the complainant would take legal action against the opposite party. Subsequently, on 12.09.2011, the complainant sent another similar notice by way of Telegram to the opposite party, asking the opposite party to deliver the machine on or before 14.09.2011. The copy of the Telegram certified by the Telegraph Department is marked as Ex.A6. Legal Notice dated 07.09.2011 was also issued by the complainant. However the notice was returned unserved with an endorsement on the Postal cover that "No such Door No.78k", both the copy of the legal notice and the returned cover were marked as Ex.A9 and also A10.
(7). The copy of the legal notice dated 03.10.2011 sent by the opposite party to the complainant was marked as Ex.B1 wherein the opposite party, has stated that the sale consideration including VAT @ 4% and Service Tax was Rs.6,14,115/-, out of which only Rs.5,40,000/- was paid by the complainant. However the opposite party has admitted in her Written Version that totally Rs.5,90,000/- was paid by the complainant to the opposite party, but wrongly stated in the legal notice Ex.B1 as Rs.5,40,000/-. Therefore only the amount towards VAT & Service Tax had to be paid by the complainant and that has to be 9 paid on the date of delivery of the machine. The total cost of the machine Rs.5,90,000/-
was paid by the complainant as admitted by the opposite party in Ex.A3 & A4. B2 is said to be a receipt issued by one Sri Shakthi transport on 1.07.2011 for the allegedly transporting of the machine. The said document is not a public document and further there is no possibility to transport the machine on 01.07.2011 itself or to pay any advance amount for the Transport on the said date. As per the alleged receipt the opposite party has stated Rs.5000/- was paid as advance for Transporting the machine and the balance Rs.10,000/- had to be paid on a later date. Under Ex.A3 and A4 letters the opposite party had informed the complainant that the machine would be delivered only on or before 05.09.2011 and Ex.A4 letter was addressed by the opposite party on 15.08.2011 and therefore there was no possibility for making any payment by the opposite party towards transport charges, or advance for transporting the machine on 01.07.2011, hence Ex.B2 has no evidentiary value to decide this matter. Ex.B3 is said to be a xerox copy of a proforma invoice dated 27.05.2011, produced by the opposite party which had not even been signed by the complainant or opposite party. Similarly other documents Ex.B4,B5 are Xerox copies of email which would also not support the case of the opposite party. (8). There is clear admission under Ex.A3 and A4 by the opposite party to show that the entire sale consideration was paid by the complainant on 15.06.2011 itself, except the amount to be paid for VAT and Service Tax. However the opposite party without making delivery of the machine sought time till 05.09.2011 under Ex.A3 letter. Even after the date 05.09.2011 the machine was not supplied by the opposite party though the complainant had sent legal notice and various telegrams asking the opposite party either to delivery the 10 machine as agreed or return the amount Rs.5,90,000/- paid by the complainant with interest, however that was not done by the opposite party.
(9). As per sec 2 (1) ( r) of the Consumer Protection Act it is clear that "unfair trade practice" means any improper trade practice being followed, or false promise or misleading advertisement being made for the purpose of promoting the sale, or supply of any goods or for providing any service, by adopting any unfair method or unfair or deceptive practice. The Act further says under sec. 2(1)(x) that giving false or misleading facts disparaging the goods, services or trade is also be unfair trade practice. The Hon'ble Supreme Cout of India in Bhanwar & Kanwar Vs. R.K.Gupta and another (2013) 4 SCC 252; (2013) CPJ 5 (SC); 2013(2) CPR 611 (SC) has given an elaborate interpretation on the legal issue of "Unfair Trade Practice", while upholding the views of the National Commission that there was unfair trade practice and the Hon'ble Appex Court in view of the unfair trade practice followed by the opposite party held that the appellant / complainant was entitled for enhanced compensation and it has been made clear by Hon'ble Supreme Court that misleading advertisement with the false promise or false representation would also be unfair trade practice.
(10). In the instant case as per Ex.A1 and A2 the opposite party had specifically stated that the total sale consideration except VAT and Service Tax was Rs.5,90,000/-,In the proforma invoice the amount including VAT and Service Tax was stated at Rs.6,14,115/- and it is seen that Ex.A2 proforma invoice had been signed by both the parties and as per the document the total cost of the Automatic paper cup making machine was stated only at Rs.5,90,000/- that was admittedly paid by the complainant on 15.06.2011 itself. 11 The document further reads that delivery time, within 30 days after the full payment. It is also admitted by the opposite party in Ex.A3 letter that the full amount Rs.5,90,000/- was paid by the complainant and the opposite party further assured under Ex.A3 that on or before 05.09.2011 the machine would be supplied to the complainant otherwise the opposite party would return the full amount i.e., Rs.5,90,000/- to the complainant. It is not in dispute that the opposite party had never delivered the machine either within 30 days from the date of payment, 15.06.2011, made under Ex.A2 or even before 05.09.2011 as assured under Ex.A3 letter or subsequently. The amount Rs.5,90,000/- received from the complainant was also not returned by the opposite party even as per the assurance given in Ex.A3, but strangely the opposite party has raised an unreasonable defence stating that the complainant had caused the delay. As per sec 2(1) ( r) of the Consumer Protection Act, in the light of the decision rendered by the Hon'ble Supreme Court, it is clear that the opposite party was adopting various unfair methods and also adopted deceptive practice by not making delivery of the machine as agreed though the total amount was received from the complainant, and the amount received from the complainant was also not returned by the opposite party though unfair trade practice is detrimental to the object of the Consumer Protection Act.
(11). The Hon'ble Supreme Court has heavily come down in the case referred to, above on unfair trade practice and in view of the same awarded enhanced compensation for the affected party, stating that the misleading advertisement and unfair trade practice caused physical and mental injury to the appellant / complainant in that case. In the instant case it is seen that the opposite party had issued a legal notice dated 03.10.2011 Ex.B1, after having received the telegraphic notice dated 17.08.2011 sent by the complainant. In the 12 same notice Ex.B1 the opposite party had wrongly stated that the amount received from the complainant was only Rs.5,40,000/- however in the Written Version she had admitted that the amount received from the complainant was Rs.5,90,000/- but in the notice Ex.B1 the opposite party by mistake stated that the amounts was only Rs.5,40,000/-. However the opposite party had stated that the balance amount had to be paid by the complainant, even without specifying the balance amount, contrary to the admission made by her in Ex.A3. The other averments made in the notice Ex.B1, are also very vague and not supported by any legally acceptable evidence. In the Written Version filed before the District Forum, the opposite party had stated in para No.7 that the opposite party had to pay Rs.30,000/- towards transport charges of the machine as per the receipt issued by one Sri Shakthi Transport 01.07.2011 apart from that the opposite party had to pay Rs.10,000/- towards loading and unloading charges. It is seen that Ex.B2 is a xerox copy of an alleged receipt dated 01.07.2011 made in the letter head of one Sri Shankthi Transport, Tuticorin, which reads that the freight was Rs.15,000/- advance Rs.5,000/- paid and the balance was Rs.10,000/-. Ex.B2 is not a public document issued by any authority and further, as admitted by the opposite party, in Ex.A3 letter and in the subsequent letter A4, dated 15.08.2011, the machine was not delivered or supplied by the opposite party till 05.09.2011 or subsequently therefore there is no possibility for the opposite party to pay any advance amount towards freight for transporting the machine on 01.07.2011 itself. In the Written Version the opposite party had stated that Rs.30,000/- had to be paid towards transport charges of the machine and for loading and unloading charges Rs.10,000/- it is seen that the said unreasonable defence has been raised by the opposite party against the 13 evidence available on record after admitting the fact under Ex.A3, that the machine was not delivered till 05.09.2011 or subsequently.
If a proposed seller, after receiving the entire cost for the goods or machine fails to make delivery of goods or machine, as agreed and also not returned the money, but raises a plea of non-payment of Tax or any unsustainable defence, and adopting delay tactics, is guilty of unfair trade practice under Sec (2) (1) ( r) & (x) of the Consumer Protection Act and on such circumstances, the affected party is entitled to the relief as per law with compensation.
The evidence available or record is crystal clear to establish that the appellant / opposite party has caused deficiency of service and followed unfair trade practice, after receiving the full consideration of the machine Rs.5,90,000/- on 15.06.2011 itself, without making delivery of the machine within 30 days as per Ex.A2 or subsequently and even without returning the amount received from the complainant as promised under Ex.A3 unsustainable defence being raised by the opposite party. Therefore we concur with the view taken by the District Forum as confirmed by the Learned Non-Judicial Member of the Circuit Bench, that the appellant / opposite party has committed deficiency of service and also guilty of unfair trade practice and accordingly we answer the point No.1 for determination in favour of Respondent / Complainant and against the Appellant / Opposite party.
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(12). Point No.2 The Learned Judicial Member of the Circuit Bench has allowed the appeal preferred by the opposite party, whereby set aside the order passed by the District Forum and Dismissed the complaint. The Learned Judicial Member Circuit Bench has given a finding, whereby held that the complainant had caused the delay in paying the balance amount and also not interested in taking delivery of the machine. It is seen that the original proforma invoice signed by both the complainant and the opposite party on 15.06.2011, has been marked as Ex.A2. Ex.A1 is an agreement prepared on a Rs.20/- non-judicial stamp paper wherein both the parties signed on the same day, 15.06.2011. However the Judicial Member Circuit Bench by his order in para Number-10 has stated that proforma invoice was issued by a company in China who are the manufacturer of the machine on 27.05.2011, and Ex.B3 is the xerox copy of the proforma invoice, dated 27.05.2011 filed by the opposite party before the District Forum. On a perusal, it is clear that Ex.B3 is only a xerox copy signed neither by the complainant nor by the opposite party and hence Ex.B3 has got no evidentiary value to decide this case. However the Judicial Member, Circuit Bench has given a finding based on the document Ex.B3 though the document was neither signed by the complainant nor by the opposite party and as such it would not bind the parties, ignoring the vital documents Ex.A1,A2 signed by both the complainant and opposite party on 15.06.2011 and also the important document, Ex.A3 letter sent by opposite party to the complainant making a clear admission of her default. As per the Ex.A2 original proforma invoice signed by both the parties on 15.06.2011, the total cost of the Automatic paper cup making machine, as admitted by both of them was only Rs.5,90,000/- except the VAT @ 4% and Service Tax and that the entire amount 15 Rs.5,90,000/- was paid by the complainant, as admitted by the opposite party in her letter Ex.A3. However the Learned Judicial Member of the Circuit Bench has held that the complainant was not ready to pay the balance amount such finding is contrary to the evidence available on record. The order passed by the Judicial Member, Circuit Bench reads further that the complainant failed to take delivery of the machine by paying full amount including transporting charges, transport insurance, demurrage charges and also not interested to take delivery of the machine which is also totally against the evidence available on record. There is no need for the complainant to pay any demurrage charges. Even the opposite party has not produced any supporting documents to show that she had paid any demurrage charge, transport charge or transport insurance, however there is unreasonable finding not based on evidence by the Learned Judicial Member of the Circuit Bench. The opposite party has clearly admitted under Ex.A3 and A4 that Automatic paper cup making machine could not be supplied within 30 days to the complainant as promised by the opposite party and assured to supply the same on or before 05.09.2011, otherwise the opposite party would return the full amount Rs.5,90,000/- received from the complainant, Ex.A3 letter sent by the opposite party to the complainant is a clear and categorical admission made by the opposite party to the complainant for the default caused by the opposite party, hence the finding given in the order by the Learned Judicial Member of the Circuit Bench is unsustainable, as the same is against the evidence available on record.
Having gone through the facts and circumstances and the evidence available on record, we are of the considered view that the order passed by the District Forum is legally sustainable and the view of the Non-Judicial Member of the Circuit Bench is also 16 acceptable, in this regard, and the order passed by the Judicial Member Circuit Bench allowing the appeal and setting aside the order passed by the District Forum is unsustainable in law since the said finding is contrary to the evidence available and accordingly the point for determination Number.2 is answered in favour of the complainant and against the appellant /opposite party.
(13). Point No.3 In view of the findings given for point Numbers-1&2, it is clear that the District Consumer Disputes Redressal Forum, Virudhunagar @ Sriviliputtur has passed only a proper order based on the evidence available on record in CC.No.35/2011 dated 21.07.2015, which needs no interference by this State Commission, so as to allow the appeal and set aside the said order. It is seen that the appellant / opposite party having received the full amount Rs.5,90,000/- on 15.06.2011 from the complainant, under Ex.A1 & A2 and promised to deliver the machine within 30 days from the date of payment and thereafter sought time under Ex.A3 till 05.09.2011 and also assured to return the full amount Rs.5,90,000/- to the complainant, if the opposite party failed to supply the machine on or before 05.09.2011, but unfortunately the opposite party by adopting various tactics adopting unfair trade practice, has caused mental agony and financial loss to the Respondent / Complainant for several years. On the said circumstances, we find it reasonable to impose a cost of Rs.20,000/- in this appeal to be paid by the opposite party with subsequent interest @ 12% p.a. 17 In the result confirming the order passed by the Consumer Disputes Redressal Forum Virudhunagar @ Sriviliputhur in CC.No.35/2011 dated 21.07.2015 the appeal preferred by the opposite party is dismissed with cost and the appellant/opposite party is also directed to pay Rs.20,000/- to the respondent/complainant towards litigation expenses in this appeal, in addition to the amount payable to the complainant as per the order passed by the District Forum.
The entire amount shall be paid within 6 weeks from the date of this order, failing which considering the facts and circumstances the entire amount shall carry interest at 12% per annum.
Sd/.. sd/.. sd/.. S.M.LATHAMAHESWARI K.BASKARAN S.TAMILVANAN MEMBER JUDL. MEMBER PRESIDENT