State Consumer Disputes Redressal Commission
Ethos Ltd. vs Axis Bank Ltd. on 15 February, 2017
Daily Order STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T., CHANDIGARH Appeal No. : 249 of 2016 Date of Institution : 02.09.2016 Date of Decision : 15.02.2017 Ethos Ltd. (earlier Kamal Retail Ltd.) SCO 89-90, Sector 8-C, Chandigarh, through its Authorized Signatory, Chief Financial Officer, Raja Sekhar. ......Appellant/complainant V e r s u s Axis Bank Limited, Merchant Services, Sector 34, Chandigarh, through its Branch Manager. Axis Bank, Business Banking, 1st Floor, WZ-G-1/262, Block G-1, Main Najafgarh Road, Uttam Nagar, New Delhi, through its Branch Manager. ....Respondents/Opposite Parties Appeal under Section 15 of the Consumer Protection Act, 1986. BEFORE: JUSTICE JASBIR SINGH (RETD.), PRESIDENT. MR. DEV RAJ, MEMBER.
Argued by:Ms.Geeta Gulati, Advocate for the appellant.
Sh.Saurav Goyal, Advocate for the respondents.
PER JUSTICE JASBIR SINGH (RETD.), PRESIDENT This appeal is directed against an order dated 25.07.2016, rendered by the District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (hereinafter to be called as the Forum only), vide which, it dismissed a complaint filed by the appellant, claiming refund of amount, to the extent of Rs.1,68,404.08ps., towards price of a watch sold to its customer namely Alok Prabhakar, from its (appellant) duty free store at Terminal-3, Indira Gandhi International Airport, New Delhi.
As per facts on record, the above said Alok Prabhakar (in short the customer), vide invoice Annexure C-1, purchased a watch in dispute, on 31.03.2013, from duty free store at the above said international airport. The payment was received by the appellant on 02.04.2013, through credit card issued by the Chase Bank (in short the issuer bank). Transaction was concluded through the respondents Bank (in short the acquiring bank) as per conditions contained in VISA International Operating Regulations 2013. On 16.04.2013, the customer of the appellant after reaching U.S.A. offered to return the watch, on the pretext that his wife had not liked the same. Relevant contents of email Annexure C-3, sent by the said customer, to the appellant, on 16.04.2013 read thus:-
"Subject: Omega Watch Model Number:323.10.40.40.02.001 Hi Lalit, I am even attaching the receipt.
Here is my email ID and contact number.
[email protected] [email protected] My telephone number is 9278-598-845:
Once again I am not here to return this watch I understand your position as well.
Please see what is needed so that we can do the exchange and this way both of us get what we need.
Most important I bought this watch for my wife and if she is not happy its going to be ugly.
Please understand my position and help me."
The customer opted not to accept the watch, on the ground that it was not liked by his wife. The said email was replied by the appellant on 28.04.2013. Relevant contents of the said email read thus:-
"Subject: Omega Watch Model Number:323.10.40.40.02.001 Dear Sir, I tried to send to send you the mail earlier regarding the same, but there was a major problem in the office system, it took about ten days to get it fixed, and I didn't had your e-mail ID with me, and for the replacement of your watch, I spoke to the highest authority regarding your concern, but I regret to inform you that, your watch could not be replaced, due to being a duty free store and the custom's regulation are very tough here, so I was told that, we could not mend the same for this transaction. Hope you would find some other solution for the same."
It was specifically stated that, as the watch was purchased from duty free store, as per Custom's Regulation, it cannot be taken back in return. Thereafter, it appears that the customer made a chargeback request, to its issuer bank (Chase Bank). The acquiring bank intimated the appellant qua the said request and to settle the dispute, demanded certain documents through email dated 01.05.2013 Annexure C-4. The detail of requisite documents sought, is mentioned hereunder: -
"Chargeslip Copy Invoice/Bill Copies Proof of Delivery signed by the Cardholder All documents pertaining to this transaction Merchant's Comments regarding this transaction Any agreement entered into by the merchant with the cardholder Also provide proper merchant explanation letter on Merchant's Letter head duly signed by merchant."
It is case of the appellant that those documents were supplied, except the last two documents i.e. copy of any agreement entered into between the customer and the appellant; and proper merchant explanation letter on merchant's letter head, as to why, watch cannot be taken in return. It is case of the appellant that thereafter, vide email dated 24.05.2013 Annexure R-1, following explanation was furnished for not getting the watch in return: -
"This is to confirm that we did not make any commitment regarding return/exchange of watch. Since it is a duty free store, once the product is sold it cannot be taken back as it is exported out of country so kindly approve the transaction"
It was specifically stated that there was no promise made to get the watch in return, if it was not liked by the wife of the customer. The respondents through email dated 20.06.2013 requested for explanation letter, which was mailed by the appellant on the same day, however, even before receipt of above said explanation letter, the charging back of amount, in question, was ordered by the respondents, to the issuer bank on 19.06.2013 and this intimation was sent to the appellant through email dated 29.10.2013. It was said that as the appellant was late in supplying the explanation letter, therefore its request for not doing the charge back of the amount, in question, was declined. Vide email dated 24.12.2013 Annexure C-7, the appellant was intimated qua closure of its claim. Thereafter, the appellant sent a legal notice on 20.02.2014, which was replied by the respondents on 02.04.2014 Annexure C-9, giving an assurance to the appellant to look into its grievance. Thereafter, nothing was done, which forced the appellant to file the complaint bearing no.720 of 2015 on 21.10.2015, which was dismissed by the Forum, vide the order impugned.
It is on record that upon issuance of notice, the respondents filed their reply and evidence. It was admitted that the customer had purchased the watch in question, from the appellant through VISA Card, issued by the Chase Bank. The credit card holder raised dispute with the bank, regarding transaction and asked to credit the amount to his account. Intimation was sent to the appellant. With a view to settle the dispute, a request was made to supply certain documents. Explanation letter was not submitted in time and as per Regulations, regulating VISA card, the amount was charged back to the account of the customer, on expiry of the requisite period on 19.06.2013. Request of the appellant to reconsider the charge back transaction was taken up with the issuer bank, however, after considering the issue, the issuing bank refused to credit the amount in dispute, to the account of the appellant. Receipt of legal notice is admitted.
In the rejoinder filed, the appellant reiterated all the averments made in the complaint and repudiated those of the respondents, contained in their written reply. Alongwith rejoinder, certain documents were also placed on record.
The Forum dismissed the complaint primarily taking note of the fact that to settle the dispute, the respondents sent a request to the appellant, to provide necessary documents. Some documents were not supplied, within the stipulated period and, as such, respondents were justified in charging back the amount credited in the account of the appellant, to the issuing bank. It was further stated that as Alok Prabhakar, the customer, was not impleaded as a party to the original complaint, who was a necessary party, the complaint was not maintainable.
Before this Commission, it is vehemently contended by Counsel for the appellant that the Code, under which, amount has been returned (charged back) to the account of the issuing bank was not applicable to the facts of the present case. As per detail given by the respondents, issue qua charging back of the amount was raised (email dated 24.05.2013 page 21), by the issuing bank, under reason Code 30 of the VISA Regulations referred to above. The said Code provides for charging back, for an article purchased, under the following conditions: -
"Services not rendered or merchandise not received".
We are going to accept the above said contention, for the reasons to be recorded hereinafter. It is not in dispute that the customer i.e. Alok Prabhakar, purchased one watch for an amount of Rs.1,68,404.08ps., from duty free store run by the appellant at the international airport on 31.03.2013. He reached USA alongwith that watch and raised an issue of returning thereof on 16.04.2013, as it was not liked by his wife. There is nothing on record to show that at the time of selling the said watch, any promise was made by the appellant to get it returned, in case it is not liked by the wife of the customer. As is apparent from the contents of email dated 16.04.2013 (Annexure C-3), the above said customer wanted that watch be returned, as it was not liked by his wife. Promptly, the said email was replied by the appellant. The said customer was told that as the watch was purchased from duty free store, it could not be replaced in terms of Custom's Regulation.
In the very first email dated 16.04.2013 Annexure C-3, it was not the case of the customer that any promise was made to get the watch in return, if it was not liked by his wife. The said plea taken, in a communication sent to the issuing bank, appears to be an afterthought. As on today, the appellant has not received even a single penny for the watch sold by it, for an amount of Rs.1,68,404.08ps. The amount credited to the account of the appellant has been charged back to the issuing bank and watch is also in custody of the customer, namely Alok Prabhakar.
In the present case, it is not a case that deficient service was provided or merchandise purchased was not received by the customer concerned. By selling and handing over the watch in duty free store to the customer, who had taken it to USA, we feel that perfect service has been rendered by the appellant to its customer. It is also not a case, in which the customer had not received the product, for which he had paid consideration. The above said condition/code, under which charging back has been made, was wrongly invoked by the respondents. At that stage, it was candid duty of the respondent's bank, even if the charging back was made, to ensure that the customer returns the purchased watch to the appellant, may be through the issuing bank. Return of the watch was never claimed by the respondents and by not doing so, the appellant was put to a total loss.
In so far as plea taken up by the respondents that the documents claimed were not supplied, the same is also not appreciable. It is on record that in response to email dated 01.05.2013, the first five documents were immediately supplied. From the sequence of events mentioned above, it should have been apparent to the respondents that no agreement was entered into, when selling the watch to the customer. So was also no case of the customer. The merchant explanation was also supplied through the email, making it very clear that such watch was purchased from duty free store, and when taken out from the country, it will be deemed to have been exported and cannot be taken back in return. Without application of mind, it was said that the facts were not made known to the respondents, within the stipulated period, on account of which, charging back was ordered.
Furthermore, it is not in dispute that when email was received by the appellant from the respondents on 20.06.2013, requesting that explanation letter be supplied, it was mailed by the appellant on the same very day. However, without waiting for the result of such request, charging back of the amount, in dispute, was ordered on 19.06.2013. The above fact makes it very clear that the respondents were very eager to order charging back of the amount, in dispute, and were not interested in rendering service to its customer and also to protect the interest of its customer i.e. the appellant. The said Alok Prabhakar cannot be made to gain at the cost of the appellant. Without paying a single penny, he has become owner of a very costly watch. In the said process, contribution of the respondents is enormous. The bank service is a service recognized under Section 2 (1) (c) (o) of the Consumer Protection Act, 1986. It cannot be said that the service recipient cannot file a complaint against the respondent's Bank, for providing deficient service. It is also on record that through email dated 24.05.2013 Annexure R-1, it was made very clear by the appellant that there was no promise to accept the said watch, in return, as alleged by the customer. Furthermore, we are satisfied that in view of facts mentioned above, fault lies only with the respondents, in creating the mess aforesaid. The customer, Alok Prabhakar, was not a necessary party to maintain this complaint. The appellant is claiming relief qua deficiency in providing service against the respondents only. Action has been taken by the respondents, in ordering charge back from the account of the appellant, without application of mind. In view of above, the order passed by the Forum needs to be set aside.
For the reasons recorded above, the appeal is partly accepted with cost. Following directions are given to the respondents, jointly and severally:-
To credit an amount of Rs.1,68,404.08ps. in the account of the appellant, with simple interest @8% p.a., whereof 19.06.2013, when charge back was ordered from the account of the appellant, in favour of the issuing bank. To pay Rs.20,000/- as cost of litigation, to the appellant.
The amount ordered be paid, within a period of one month, from the date of receipt of a certified copy of this order, failing which, the amount ordered to be credited, at sr.no.(i) shall carry penal interest @12% p.a. instead of 8% p.a. whereof 19.06.2013, and the amount of cost of litigation will carry interest @12% p.a. from the date of filing the original complaint before the Forum, till realization. However, liberty shall remain with the respondents to claim return of the watch or its price from the customer namely Alok Prabhakar, through the issuing bank or otherwise.
Certified copies of this order, be sent to the parties, free of charge.
The file be consigned to Record Room, after completion.
Pronounced.
15.02.2017 Sd/-
[JUSTICE JASBIR SINGH (RETD.)] PRESIDENT Sd/-
(DEV RAJ) MEMBER Rg