Delhi District Court
M/S Rohan Resorts Private Limited vs Audi Ag on 26 April, 2025
IN THE COURT OF MS. PRABH DEEP KAUR: DJ-05, SOUTH
EAST DISTRICT, SAKET COURTS, DELHI
CS DJ NO. 11405/16
CNR NO. DLSE01-007957-2016
In the matter of :-
M/s. Rohan Resorts Pvt. Ltd.
Through its Director
Mr. Rohan Khare,
7/6, Sarvapriya Vihar,
New Delhi
..........PLAINTIFF
Versus
1. Audi AG
Through its chairman / Managing Director
International Customer Services
85045 INGOLSTADT,
Germany
2. Audi India
Through its chairman / Managing Director
3, North-Avenue Level-4
Maker Maxity, Bandra Kurla Complex,
Bandra (East), Mumbai-400051, India
3. Audi Delhi
Regent Garage Pvt. Ltd.
B-1/H-1, Mohan Co-operative Industrial Estate
Mathura Road, New Delhi-110044
......... DEFENDANTS
Date of Institution : 03.07.2015
Arguments concluded on : 03.04.2025
Date of Judgment : 26.04.2025
CS DJ NO. 11405/16 Page No. 1 of 33
M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025
Digitally signed by
PRABH PRABH DEEP KAUR
DEEP KAUR Date: 2025.04.28
17:25:09 +0530
SUIT FOR RECOVERY OF RS. 1,00,00,000/- (One crore)
JUDGMENT
1. Vide this Judgment, suit for recovery of damages of Rs. 1,00,00,000/- alongwith interest and cost filed against the defendants has been disposed off.
2. Th case of plaintiff is that:
2.1 The plaintiff company purchased an Audi A4 car from Defendant No. 3 (Regent Garage Pvt. Ltd.) on 14.04.2009 for its Director Mr. Rohan Khare. On 08/09.10.2009, the car met with a major accident.
Despite severe damage, the airbags did not deploy, which the plaintiff asserts should have occurred given the frontal nature of the impact. This failure led to mental trauma for the Director and is alleged to be due to a manufacturing defect. The plaintiff initially filed a consumer complaint in 2010 but had to withdraw it in 2015 in view of the ruling by the Hon'ble National Consumer Disputes Redressal Commission (NCDRC), which held that a company is not a consumer under the Consumer Protection Act if it purchases goods for its Director's use. The present civil suit followed thereafter.
2.2 The plaintiff claims that the car was purchased for Rs. 29,68,661/- and the total cost paid to the defendants, including road tax and charges was Rs. 31,67,130/-. Following the accident, the insurance claim settled was Rs. 17,40,278/-, of which Rs. 3,70,357 - was borne by the plaintiff. However, the car continued to malfunction and required frequent repairs. Ultimately, the plaintiff had to sell it in 2012 for Rs. 16,70,000/- due to the inconvenience of continuous breakdowns.
2.3 Based on these circumstances, the plaintiff seeks Rs. 20,00,000/- for the supply of a faulty vehicle, Rs. 70,00,000/- as compensation for CS DJ NO. 11405/16 Page No. 2 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP KAUR DEEP Date:
KAUR 2025.04.28 17:25:14 +0530 harassment, mental trauma, and business losses, and Rs. 10,00,000/- towards litigation expenses. The plaintiff has impleaded Defendant No. 1 (Audi AG, Germany), Defendant No. 2 (Audi India) and Defendant No. 3 (Audi Delhi/Regent Garage Pvt. Ltd.) on the grounds of misrepresentation of the vehicle's safety features, particularly regarding the airbag deployment mechanism which failed during the accident. 2.4. The plaintiff further avers that Audi A4 was advertised and promoted as a premium safety-compliant car equipped with six airbags.
The car's promotional materials and crash-test data published on Audi's official website portrayed it as one of the safest cars globally. The failure of the airbags to deploy during the accident, the plaintiff argues, stands in stark contrast to these claims.
3. Defence of Defendant No. 13.1 Defendant No. 1 submitted that the suit is not maintainable against it as it is a foreign entity based in Germany and has no direct role in the sale, service, or warranty of the vehicle in India. It stated that the car in question was manufactured in India by Skoda at Aurangabad and sold in India through Defendant No. 2 and its dealership network, including Defendant No. 3. Thus, Defendant No. 1 claims it has no privity with the plaintiff and no service of suit was effected in compliance with the Hague Convention, which is a mandatory requirement. The written statement has been filed without prejudice to its rights and it is expressly stated that mere appearance does not constitute waiver of jurisdictional objections. 3.2 Defendant No. 1 also asserted that the plaintiff had withdrawn a similar complaint against it before the Consumer Forum in 2015, hence it is barred from filing this present suit on the same cause of action. It CS DJ NO. 11405/16 Page No. 3 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed PRABH by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:23 +0530 further clarified that Defendant No. 2 is not its subsidiary, but a division of Volkswagen Group Sales India Pvt. Ltd. Lastly, it denied any defect in airbags, explaining that the system works based on very specific sensors and threshold impacts, and that no defect was reported in this case by the ECU.
4. Defence of Defendant No. 24.1. Defendant No. 2, Volkswagen Group Sales India Pvt. Ltd., clarified that it deals in marketing and sale of Volkswagen group vehicles in India, including Audi, through its dealers. It denied that Defendant No. 3 is its agent, stating instead that the relationship is that of Principal to Principal. It argued that the car was delivered to the authorized dealer only after passing stringent quality checks and safety tests, including compliance with high-impact crash test standards. 4.2 Defendant No. 2 submitted that the plaintiff had sold the car in 2012 and therefore, had no subsisting right, title, or interest in the vehicle at the time of filing the suit. It highlighted that the car had been driven extensively post-repair and plaintiff had also received a courtesy car during repair. It stated that the plaintiff failed to establish any defect or deficiency in service and continued using the car extensively, even post-accident. The safety mechanisms like airbags are supplemental, and designed to deploy only under specific circumstances involving deceleration beyond a defined threshold.
4.3. It emphasized that the airbags did not deploy because the crash did not meet the required conditions for activation as per the ECU. Defendant No. 2 further stated that the allegations regarding manufacturing defects were unsupported and speculative, relying on non-expert internet material. It concluded that the plaintiff was trying CS DJ NO. 11405/16 Page No. 4 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed PRABH by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:28 +0530 to misuse the process of law by concealing material facts and distorting information, and hence the suit should be dismissed.
5. Defence of Defendant No. 35.1. Defendant No. 3, Regent Garage Pvt. Ltd., took the plea that the plaintiff had not initially raised any grievance against it before the Consumer Forum and had no privity of contract with it concerning design, safety or manufacturing issues. It clarified that it was only the authorized dealer of Audi vehicles and had no role in the design, manufacturing, or warranty terms.
5.2 It is stated that since Defendant No. 3 neither manufactured nor assembled the vehicle, and the claim pertains to alleged manufacturing defect, the correct party to sue would be the manufacturer. Relying on judicial precedents, Defendant No. 3 contended that it cannot be held liable in such a context and that the plaintiff's action is time-barred and based on ignorance of law.
5.3 Additionally, Defendant No. 3 stated that the plaintiff had already received insurance compensation, sold the car in 2012, and had concealed the fact that he continued using the car for thousands of kilometres post-repair. It maintained that all services were duly rendered, no defect was concealed, and the suit is an afterthought meant to exploit reputational leverage against the brand.
6. The plaintiff has filed rejoinder to the written statement of defendant thereby reaffirming and reiterating the contents of written statement.
7. From the pleadings of the parties, following issues were framed vide order dated 13.02.2018:-
1. Whether the plaintiff is entitled for a decree for recovery of the CS DJ NO. 11405/16 Page No. 5 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:25:33 +0530 suit amount? OPP
2. Whether the plaintiff is entitled to the interest as claimed? OPP
3. Whether the defendants have no liability to pay any amount to the plaintiff? OPD
4. Whether there is no privity of contract between the plaintiff and the defendant no. 3 and consequently there is no liability to pay any amount to the plaintiff? Onus on party
8. Thereafter, matter was fixed for plaintiff's evidence.
In order to prove its case, the plaintiff examined its AR Sh. Rohan Khare as PW-1. He has reiterated the facts of plaint in his affidavit Ex.PW1/1. He has relied upon the documents i.e. Board resolution as Mark PW1/A, Advertisement Mark PW1/B and documents i.e. Invoice Ex PW1/C (OSR), Towing challan Ex PW1/D (OSR), photographs of damaged car Ex PW1/E to Ex PW1/J, Police report dt. 09.10.2009 Ex PW1/K, Medical prescription Mark PW-1/L, Report of X-rays Mark PW1/M, Emails Ex PW1/N to Ex PW1/Q, Legal notice Ex PW1/R (OSR), reply of defendant no. 2 Ex PW1/S (OSR), Reminder notice dt. 30.11.2009 Ex PW1/T (OSR), Reply to reminder notice Ex PW-1/U (OSR), Booklet of Audi AG Mark PW-1/V, Audi A4 Safety features and feedbacks from customers Mark PW-1/W, Order dt. 23.02.2015 Mark PW-1/X, Tax invoices dt. 31.03.2010 Mark PW-1/Y, delivery receipt dt. 06.09.2012 Mark PW-1/Z, Form 29 and 30 Mark PW-1/Z1 to Mark PW-1/Z2, NOC Mark PW1/Z3, Cash receipt dt. 06.09.2012 Mark PW-1/Z4, Election ID proof of transferee Sh. N.S. Narula Mark PW-1/Z5, Demand drafts Mark PW-1/Z6 to Mark PW-1/Z8. He was extensively cross examined at length by Sh. S.N. Mitra, Sh. Dattatray Vyas and Sh. Chandan Malik, Ld. Counsels CS DJ NO. 11405/16 Page No. 6 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:38 +0530 for the defendant no. 1, 2 and 3 respectively.
Thereafter, matter was fixed for defendant's evidence.
9. In defence, the defendant examined Sh Syed Kumail Asghar Rizvi as D2W1. He tendered his evidence by way of affidavit Ex.D2W1/A thereby reiterating the defence taken in the written statement. He has also relied on the documents which are Ex D2W1/1 (colly) to Ex D2W1/6. He was cross examined at length by Sh. Jaikush Hoon, ld. counsel for the plaintiff.
10. In defence, the defendant no. 3 examined Sh. Vinod Kumar Sharma, working as D3W1. He tendered his evidence by way of affidavit Ex.D3W1/Z. He has also relied on the documents which are Ex. D3W1/1, Ex D3W1/A to Ex D3W1/H. He was cross examined at length by Sh. Jaikush Hoon, ld. counsel for the plaintiff. Thereafter, matter was fixed for final arguments.
11. I have heard Ld. Counsel for both the parties and meticulously gone through the record.
12. Admittedly in the present suit, the registered owner of the car in question is the plaintiff company and initially plaintiff filed a consumer complaint case before Delhi State Consumer Dispute Redressal Commission in 2010. Later on in 2015, plaintiff had withdrawn the complaint as it was held in various judgments latest during that period that company is not consumer under the Consumer Protection Act and thereafter, plaintiff filed the present suit before the Court alongwith the application u/S 14 of the Limitation Act for exclusion of time in prosecuting its matter before the State Consumer Commission. The application is still pending for disposal. Admittedly, defendants have not filed written reply to the application. However, in the written CS DJ NO. 11405/16 Page No. 7 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP KAUR DEEP Date: 2025.04.28 KAUR 17:25:43 +0530 statement, defendant no. 3 has taken the plea that in prior to 2010 there were judgments which had settled down that company is not a consumer under the Consumer Protection Act and plaintiff is guilty of wilful ignorance of law.
As far as this issue is concerned, the AR of plaintiff /PW-1 has deposed during his evidence that plaintiff filed the complaint before Consumer Court with bonafide intention and only in 2015 due to latest judgment plaintiff had withdrawn the complaint. The testimony of PW-1 has remained unrebutted on this issue. Further it is settled principle that unless there is enough material indicating the action of plaintiff as dishonest and lacking good faith, the benefit of Section 14 cannot be denied to him. Defendant could not brought anything on record to prove that plaintiff filed the previous complaint with malafide intention. It has been held in various cases by the Apex Court that "if any bonafide proceedings have been initiated before the Consumer Forum, the benefit of Section 14 of the Limitation Act 1963 will be available to plaintiff, if the claim is not entertained by the Forum on the ground of jurisdiction".
Accordingly, in view of above discussion, the application of plaintiff moved u/S 14 of the Limitation Act for exclusion of time in prosecuting its matter before Delhi State Consumer Dispute Redressal Commission is hereby allowed and the time exhausted before Consumer Court is excluded and it is held that suit is within limitation.
13. My issue-wise findings are as follows:-
Issues no. 1 to 3 Issue no. 1. Whether the plaintiff is entitled for a decree for recovery of the suit amount? OPP CS DJ NO. 11405/16 Page No. 8 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:47 +0530 Issue no. 2. Whether the plaintiff is entitled to the interest as claimed? OPP Issue no. 3. Whether the defendants have no liability to pay any amount to the plaintiff? OPD Issue no. 4. Whether there is no privity of contract between the plaintiff and the defendant no. 3 and consequently there is no liability to pay any amount to the plaintiff? Onus on party All these issues are taken up together since they are interlinked involving common discussion and finding on the one will have bearing on the other. The burden to prove issue nos.1 and 2 was placed upon the plaintiff and that of issue no.3 upon the defendant.
The present suit has been instituted by the plaintiff seeking compensation and damages for supply of defective vehicle, mental harassment and trauma. The plaintiff is owner an Audi vehicle which was being driven by its Director and was involved in a road accident. It is the case of plaintiff that on 8/9.10.2009 at about 01:00 AM while PW-1 was driving the car in question, in order to save a pedestrian and another car, the car collided with the tree and the impact was so severe that front portion of the said car was totally damaged, however, despite nature and severity of the impact, the air bags did not deploy. As per plaintiff such non-deployment of air bags indicates either a manufacturing defect in the vehicle or a failure of ECU (Electronic Control Unit) to register the crash impact which according to plaintiff is a failure in the fundamental safety mechanism of the car.
The defendants have taken the plea that air bags did not deploy due to nature and magnitude of impact not meeting the deployment criteria configured in the ECU and as per defendant vehicle system CS DJ NO. 11405/16 Page No. 9 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:51 +0530 functioned as per global safety standards and the crash did not meet the threshold condition for airbags deployment.
14. Liability of defendant no. 3:
14.1 Now defendant no. 1 has taken the plea that the car in question was manufactured in India by Skoda at Auragabad and sold in India by defendant no. 2 through its dealer and thus, defendant no. 1 has no role to play in the present suit. As per defendant no. 1, defendant no. 2 is responsible for warrantee given in vehicle in question as it impracticable for defendant no. 1 to address issues post-sales of the vehicle in India and it is defendant no. 2 which give warrantee on the vehicle.
14.2 Defendant no. 2 has taken the plea that defendant no. 2 being a sales company provides customer, through its dealer a warrantee of certain period on the vehicles sold by its dealers upon certain terms and conditions and defendant no. 3 is not its agent and the relationship between defendant no. 2 and 3 is principal relationship. 14.3 Defendant no. 3 has taken the plea that there is no privity of contract between plaintiff and defendant no. 3 as defendant no. 3 is neither manufacturer nor assembler of the vehicle and at maximum plaintiff can damages from manufacturer of the vehicle i.e. defendant no. 2.
14.4 While as per plaintiff, defendant no. 1 is German Company who is selling its luxurious cars under the brand name of Audi in India through its subsidiary company i.e. defendant no. 2 who is situated in Mumbai and defendant no. 3 is authorized dealer of the Audi car in Delhi, India. As per plaintiff, it purchased the car in question from defendant no. 3 /Dealer/Agent of defendant no. 2.CS DJ NO. 11405/16 Page No. 10 of 33
M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:55 +0530 14.5 Due to internal dispute between defendants for the accountability qua the car in question, plaintiff was cross examined on the issue whether the car in question was a CBU (Completely Brought in Unit) from Germany or a CKD (Complete Knock Down Kit) having all the parts pack separately and assemble together in India. During PE, PW-1 has categorically deposed that car in question was CBU and plaintiff has relied upon the invoice Ex. PW-1/C. The defendant no. 1 has not led any evidence to refute the same. Defendant no. 2 has examined its AR as D2W1 and he deposed during cross examination that :
"......I am not sure about the establishment of Audi India but tentatively it was in 2007.l am not very sure but think that there was no manufacturing unit we had in India and the cars were directly coming from defendant No.1 and were called CBU i.e. Complete Built Unit. The exact meaning of Complete Built Unit is a complete functional ready to use unit. The Defendant No.2 does not add any additional part to this unit as it is fully built up ready to use unit provided by the defendant No. 1 to Defendant No.2.....I am not aware that whether the car in dispute was a CKD. I am also not aware whether the said car was CBU. We are still receiving CBUs from Defendant No. 1 which depends on the variants and models of the car. ...... The CBU would only be available at the discretion of the Defendant No.2. It is correct that CBUs were coming to India without any discretion till the time the assembling unit at Aurangabad was not functional / established......The responsibility of the Defendant No.2 pertaining to the functionality of the car over CBUs and CKDs is the same though the supply chain is different for both"
Thus, D2W1 admitted that the responsibility of defendant no. 2 qua the car in question is the same irrespective of the fact whether it was a CBU or CKD.
14.6 Further, D2W1 deposed during cross examination that :
"It is correct that we do receive the car parts from defendant no. 1. There are three brought classification of parts which is as follows:-i) Mechanical, ii) Electrical and Electronics iii) Consumables. It is correct that these broad classifications of parts get procured by the defendant no. 2 through defendant no. 1 only and if they do procured from some other source then I have no knowledge about it. It is correct that an engine, airbags comes under the mechanical classification of parts and ECU, sensors comes under the Electrical and Electronics classification of parts. It is correct that all four parts i.e. engine, airbags, ECU, sensorsget procured by the defendant no. 2 through defendant no. 1 only. Yes the defendant no. 2 does give the CS DJ NO. 11405/16 Page No. 11 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:25:59 +0530 warranty on the cars given to the dealers across India. (Vol. there is two broad category of warranty first is pre-sales and second is post sale). Post-sale is when the car has been sold by the seller to the end user and pre-sale is till the time it is in dealers stock. Yes we do sale our cars to the dealers which an principal to principal basis. Principal to principal basis means that the dealer who is dealing with the end user would have the complete responsibility of the transaction with the end user. The responsibility of the defendant no. 2 towards the dealer provide the defect free car as per the dealer requirement/order and providing necessary spare parts or servicing of the cars, training of dealer staffs pertaining to sales and services and commercial claim settlement raised to defendant no. 2 by the dealer. It is correct that before taking the delivery of the car from the defendant no. 2, a dealer satisfy himself to take a delivery of a defect free car. I do not have any information regarding a delivery of the car from the defendant no. 2, a dealer satisfy himself to take a delivery of a defect free car but I am aware that there is separate check sheet to compliance the same. The dealer is not obliged to inform the defendant no. 2 if any defect occurred in the car while it is getting used by the end user. Yes, It is correct that if there is any defect pertaining to the part of the car within a subscribed warranty period in that situation the defendant no. 2 would replace, repair or rectify the part/defect. (Vol. when the issue is raised to the dealer, the dealer on the very first occasion itself gives the resolution to the customer and later on he settles the claim cost with defendant no. 2). It is correct to state that if there is a faulty part which is replaced by the dealer within the stipulated warranty period, the part would be replace by the dealer but the cost of the part would be borne by the defendant no. 2. It is correct that the standard warranty of 2 years or unlimited kilometres provided by the defendant no. 2 to the end users through the respective dealers. I am not aware whether the defective part replaced by defendant no. 2 on saying of the dealer is / to be reported to the defendant no. 1. It is correct that the defendant no. 1 has nothing to do with the defective part replaced by the defendant no. 2 for the end user through the dealer. It is defendant no. 2 prerogative to take a decision on this. It is correct that when we do receive the cars and all three classification parts from defendant no. 1 we do pay the amount to defendant no. 1 for the inventory we receive....."
Further, defendant no. 3 examined its AR as D3W1 who deposed during cross examination that:
"......The subject car was not CKD. As the said car unit in question is CBU hence the manufacturer of the same unit is Defendant No.1. Defendant No.2 is not the manufacturer of the subject vehicle..."
14.7 Thus, it is clear that plaintiff has been able to prove that the car in question was a CBU and defendant no. 1 is manufacturer of the car and irrespective of internal arrangement between defendants, defendant CS DJ NO. 11405/16 Page No. 12 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed PRABH by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:03 +0530 no. 1 being manufacturer of car in question is liable towards the plaintiff if it is proved that car had the manufacturing defects. As far as defendant no. 2 is concerned, defendant no. 2 being subsidiary of defendant no. 1 is liable towards the plaintiff/ the end user if plaintiff successfully proves that car in question suffered manufacturing defects because plaintiff has not relied upon only defendant no. 2 or defendant no. 3 but admittedly, he has relied upon the brand name of defendant no.1 i.e. Audi. The defendant no. 1 Audi AG, by allowing its brand name and material and safety rating to be used in India, undertook the responsibility for its representations. The principle of "extended manufacturer liability" is applicable where the parent brand creates expectations through direct or indirect marketing. Therefore, manufacturers can be held liable for safety failure, even if sales and delivery were through local agents. Thus, the denial of defendant no. 1 of involvement in Indian sales weakens in view of Audi's own brand structure where subsidiaries often act as extensions in local market. 14.8 As far as defendant no. 3 is concerned, defendant no. 3 is only a dealer and defendant no. 3 can have secondary /vicarious liability only if it is proved that it made false representations about the safety or performance of the vehicle or he failed to communicate any known issues to the buyer/plaintiff or it undertook any tampering or modification of the airbag system during pre-delivery inspection or servicing. Defendant no. 3 had been made a party under vicarious liability for acting as the agent of the manufacturer, therefore, if the dealer merely sold the car in good faith without knowledge of defects and no misconduct is attributed to him, defendant no. 3 may not be held liable directing. The dealer has been included in the suit for CS DJ NO. 11405/16 Page No. 13 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:26:07 +0530 effective adjudication, however, in case of allegations of manufacturing defects like non-deployment of airbag, the dealer cannot be held liable unless there is evidence that dealer either manipulated the system or knowingly delivered a faulty car. However, it is not the case of the plaintiff that defendant no. 3 had manipulated the system nor there is any evidence on record to prove that the alleged manufacturing defect was in knowledge of defendant no. 3 prior to sell of the car to the plaintiff. Therefore, defendant no. 3 cannot be held liable for the damages as claimed by the plaintiff and the suit of the plaintiff is to be dismissed against defendant no .3. Accordingly, issue no. iv is decided in favour of defendant no. 3 against the plaintiff.
15. Further, defendant no. 1 has taken the plea that the service of defendant no. 1 is nonest in the eyes of law because plaintiff has not complied with mandatory terms and conditions of Hague Convention & Germany and India, both being party to Hague Convention, plaintiff is liable to serve defendant no. 1 in its official language.
As far as this plea is concerned the purpose of the convention as apparent from the Article 5, as quoted by defendant no. 1 in its written statement is to grant effective opportunity to the defendant to contest the matter. Admittedly, defendant no. 1 has not only entered into appearance but has also filed WS and has also participated in trial and has been represented through a counsel throughout the trial. Therefore, it seems that plea has been taken just for the name sake and is liable to be discarded being misplaced and misconcealed.
16. The grievance of the plaintiff pertains to alleged failure of the airbags to deploy at the time of accident, leading the plaintiff to claim a manufacturing defects, to prove its case, AR of the plaintiff/PW-1 Mr. CS DJ NO. 11405/16 Page No. 14 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:12 +0530 Rohan Khare has entered into witness box. He has deposed on the lines of averments made in the plaint.
16.1 PW-1 was cross examined and during cross examination, defendants have tried to assail the authority of PW-1 to depose on behalf of plaintiff company. Admittedly, the registered owner of the property is plaintiff company. PW-1 has relied upon board resolution Ex. PW-1/A. Further, perusal of record shows that PW-1 /Mr. Rohan Khare has registered one DD entry no. 45 dated 09.10.2009 PS GK-I and as per this DD entry Mr. Rohan Khare was driving the car at the time of accident and even the Towing Challan Ex. PW-1/D mentioned his name as customer. Further, defendants themselves have relied upon the emails exchanged between parties and in all the emails, Mr. Rohan Khare has been mentioned as Director of plaintiff company and another Director of plaintiff company Mr. Rahul Khare has repeatedly stated that his son/PW-1 was driving the car at the relevant time. 16.2 It is settled principle that company is a separate legal entity and company being a legal entity cannot approach the Court on its own and human intervention in form of authorized representatives of company is required. The authority of AR of the company is tested to ensure that nobody takes the benefit from the Court in name of company without handing over the benefits to the company and also to ensure that the directors and other persons related to company are aware of the legal proceedings so that company gets the actual relief whatever granted by the Court.
16.3 In the present case, admittedly, car is in the name of plaintiff company and PW-1 /Mr. Rohan Khare was driving the car in question at the time of accident. Therefore, PW-1 is a competent witness to CS DJ NO. 11405/16 Page No. 15 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:16 +0530 prove the incident which brought up the issue of manufacturing defect i.e. non-deployment of airbags despite severity of the accident. Therefore, it is not the case where Mr. Rohan Khare / PW-1 has come to the Court on behalf of plaintiff company, without any authority.
17. Further, to prove the allegations of manufacturing defects, PW-1 has relied upon photographs of the damaged car which are Ex. PW-1/E to Ex. PW-1/J and upon towing challan Ex. PW-1/D. Ld. Counsels for defendants have objected to the photographs as to mode of proof. Admittedly, after the accident, car was repaired by defendant no. 3 being authorized dealer of defendant no. 2.
During cross examination, D2W1/AR of defendant no. 2 deposed that:
"......Witness is shown the pictures which are already exhibited as Ex. PW1/E, 1/F, 1/G, 1/H, 1/1, 1/J. Yes, it is a same car which got into the accident on dated 09.10.2009 and there is no dispute that the picture of Ex. D2W1/3 are of the same car as Ex. Pw1/E, 1/F, 1/G, 1/H, 1/1, 1/ except the picture Ex. D2W1/3 are on micro level and specifically pertaining to the damage part and component of the accidental car....
....Witness is shown the Photographs.
Based on photographs, do not think that the said car was in any conditions to be driven at all, after the accident......
Thus, there is no dispute that the photographs Ex. PW-1/E to Ex. PW-1/J are the photographs of the damaged car.
Perusal of these photographs show that the car in question had a frontal collision. Further, during cross examination D2W1 deposed that "an up frontal crash has been detected by the front airbags crashed censor".
18. Further, AR of defendant no. 2/D2W1 has been extensively cross examined and during cross examination, he deposed that:
".....Yes. There are 190 components of the car were replaced and repaired as per the list EX. D2W1/D1.
CS DJ NO. 11405/16 Page No. 16 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP KAUR DEEP Date: 2025.04.28 KAUR 17:26:21 +0530
It is correct that even after changing 190 components of the said car, I still believe that the said car was not seriously damaged.....
It is correct that this is the calculation of Rs. 13,69,921/- which is an insurance amount to be taken care by Bajaj Allianz Insurance Co. dated 05.04.2010....... It is correct that Rs. 17,40,278/- is the total calculation of the invoice raised by the Regent Garage Pvt. Ltd. to the plaintiff, which is called total amount" on the same page....
...It is correct that out of 191 parts 186 parts which were replaced falls between bumper to steering (both inclusive). It is correct that remaining 5 parts are out of the aforementioned zone (bumper to steering). These 5 remaining parts belongs to different components of the car....."
Thus, the photographs show that the present case is covered under the principle of Res ipsa loquitur i.e. the situation where circumstances speak for themselves. The photographs speak for themselves and it shows that extensive damage had been suffered by the car during the accident. It is also admitted that the car key got stuck in the car during accident which shows that the damage reached to key section. Even the form Ex. D2W1/D3 mentioned that :
"...... This car received in an major accidental condition and when we one received * key stuck in steering column. No paper and document in the vehicle.....Exhibit PW 1/E/F/G/H/I/J shown to the witness. It is correct that the photographs in exhibit PWI/E - J are of the subject vehicle. It is correct the said photographs were taken in the Defendant No.3 workshop Faridabad....."
Further, during cross examination D3W1 AR of defendant no. 3 has deposed that :
"It is correct that as per the photographs of vehicle in question, there are damages in the underbody on the front side below the engine compartment of the said vehicle."
Thus, it is clear that from the extent of the damage to the car as shown in the pictures and as demonstrated from the evidence led by the defendants, any ordinary person would have legitimate expectation that airbag will deploy to save the driver of the car and the damage CS DJ NO. 11405/16 Page No. 17 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:25 +0530 qualifies as moderate.
19. In the present case though plaintiff has not examined any expert witness but plaintiff has been able to prove the case to such an extent where the onus shifts upon the defendants to prove their defence. Moreover, the present case is not covered under the Consumer Protection Act where plaintiff has the primary liability to prove the defects and the present case being a civil case is to be decided on the scale of probabilities. In the given circumstances, the legitimate expectation of the plaintiff with respect to deployment of airbags during the accident is justified and therefore, in the peculiar circumstances of the present case, the burden of proof is upon defendants to prove that in the given circumstances, the non- deployment of airbags was justified.
20. The defendant no. 2 has heavy relied upon testimony of its technical expert who has been examined as D2W1. The summary of his testimony is that he is a technical expert associated with Audi, responsible for examining vehicle performance and safety systems in the context of incident such as the one in question. His testimony focused on explaining the functionality and logic behind airbags deployment and responding to the specific case involving the non- deployment of airbags in a car that collided with a tree. He explained that the airbags system is governed by ECU which assesses sensor inputs to determine if a deployment is necessary. The decision to deploy Airbags is not automatic upon impact but depends on several factors such as speed and direction of impact, crash severity, deceleration values, location of impact (e.g. full frontal vs off-centre). He emphasised that Airbags are calibrated to deploy only in moderate CS DJ NO. 11405/16 Page No. 18 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP KAUR DEEP Date: 2025.04.28 KAUR 17:26:29 +0530 to severe frontal crashes where injury risk is high. He also deposed that based on the post incident diagnostics and crash data, the ECU did not detect the crash severity as meeting the deployment threshold. He deposed that Airbags systems was operational and there was not fault code log in the system that would indicate malfunction. He also emphasised that as per his crash analysis, the crash was likely of-centre or not sufficiently forceful from a technical point of view to trigger deployment and the vehicle structure absorbed the energy in a manner that did not register as life threatening based on calibrated value. He testified that airbag system was developed as per international safety norms and thoroughly tested under various crash scenario and the system prioritizes avoiding unnecessary deployment, which could itself cause injury in low impact scenarios. As per his conclusion, there was no defect in the airbag system or ECU and system functioned exactly as intended and designed - evaluating the impact and deciding, based on sensor import, that airbag deployment was not necessary in this case.
21. However, there are significant contradictions in the stand of D2W1. In the affidavit D2W1 states that Audi cannot be held liable since the system acted as per programming yet in the same breath, defendants refrained from disclosing or submitting the crash data log or technical analysis report, which would be key in proving the programming executed accurately.
During cross examination D3W1 deposed that:
".....Q. Do Defendant No. 1 and 2 conduct their research pertaining to the actual road accidents when a car is driven by end user and a situation which is not covered in the test labs of NCAP while conducting an artificial accidental test? Ans. About Defendant No. 1 l am not aware. Defendant No. 2 investigates certain cases and records them in their database which is segregated case to case and that CS DJ NO. 11405/16 Page No. 19 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed PRABH by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:35 +0530 segregation would be called a 'case file' for a particular vehicle. Yes, the Defendant No. 2 does share the above said 'case file' with the defendant No. 1. Yes, we do get feedback and queries from Defendant No. 1 pertaining to the 'case file' shared with them. It is not always that we do receive the feedback or the queries; it depends on the case to case. The purpose of sharing these 'case file' with the Defendant No. 1 is to maintain records and for nothing else. I am not aware if the Defendant No. 2 shared the case file' of the subject car with the Defendant No.
1. It is the technical service department which uploads the 'case file' and send it across to Defendant No. 1.......The data for the 'case file' is provided to Defendant No. 2 by our dealers including Defendant No. 3. Yes, we do have a separate department to scrutinise the data in the 'case file' send by the dealer. (Vol. the name of the Department is "Department of Technical Service"). It is correct that I am the part of 'Department of Technical Service......It is correct that I mentioned about four cars on the first day of my cross examination dated 29.01.2020 where I said I have analysed four cars since have been with Defendant No. 2 pertaining to the non-deployment of the airbags. The first car was A4 which toppled. Second car was A6 which got under the trolley, I don't remember the model number of the Third car but the same was acquitted with the same issue and the fourth one was the present car in dispute.
Yes, Defendant No. 2 did share the 'case file' of the first car, the second car, the third car and the fourth car/car in question with the Defendant No. 1. I do not remember the year of the same. I do not remember if we received any revert to the same...."
Admittedly, the data of said case file pertaining to car in question has not been shared by the defendants with the Court. The defendants have not submitted the crash data logs or ECU telemetry as part of the record nor offered any independent validation of post crash diagnostic. Their explanation remained unilateral and unverified. Furthermore, the assertion in the affidavit that the car function flawlessly is diluted by the fact that a critical safety feature did not activate in an evidently dangerous scenario and it qualifies as deficiency in performance, if not a latent defect.
22. Further, D2W1 deposed in his affidavit that:
"I say that ECU for airbag control unit of the car will not function if there is a fault in the airbag system. If ECU has functioned and recorded the data that means there was no fault in the system...... It was found on analyzing the ECU that ECU functioned well enough to indicate that there was no crash data in fault memory indicating that there was absolutely no fault in the airbags system. ECU indicated CS DJ NO. 11405/16 Page No. 20 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:26:39 +0530 that there was no deep front crash / no destruction from structure body elements since no crash data was detected".
Thereafter, at the stage of clarifications following order was passed on 17.01.2025:
"After going through the record, it seems that certain clarifications are required with respect to working of ECU. Accordingly, using the powers u/s 165 of the Indian Evidence r/.w section 151 CPC, defendant no 1 and 2 are hereby directed to file affidavit on the following issues:-
(1) What are the specifications of ECU with respect to the vehicle in question, particularly concerning air bag deployment? (2) The details on the valocity and quantum of impact, figures that trigger air bag deployment.
(3) Does the ECU record each and every crash data incident, whether small or big and if so to what extent.
(4) Whether ECU registeres crash data only in cases deployment of airbags as registration of crash data and deployment of airbags are two different things."
In pursuant to the same, the AR of defendant has reiterated the defence of defendant and again stated that it is not possible to define the exact triggering response or airbags system and it depends on several factors. The relevant and important portion of the affidavit is as follows:
"......I say that ECU collects the data at the time of accident but does not record the data prior to accident. I say that ECU record each crash data in case of major accident......I say that ECU registers crash data irrespective of the fact whether airbags have deployed or not in the crash".
Thus, in one breath AR stated that ECU records each crash data in major accident and at the same breath, it was stated that ECU registers crash data irrespective of the fact whether airbags have deployed or not in the crash. It means every crash is to be recorded in ECU irrespective of deployment of airbags, while in the present defendants have clearly stated that ECU has not recorded crash data. It clearly demolishes the defence of defendants and it implies that there CS DJ NO. 11405/16 Page No. 21 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:43 +0530 was fault in the ECU or fault in assessment of the ECU with respect to magnitude of the crash.
23. Based on the deposition of the defendant's technical expert, it is established that the airbags system is governed by sensor based algorithm embedded in the ECU, which operates based on the impact severity, angle and deceleration data. The defendants position that the airbags did not deploy due to crash dynamic not meeting threshold parameters is accepted in principle. However, considering the description of incident wherein the vehicle struck a tree frontly and the impact the incident had on car - the justification of the defendants that it was not a moderate frontal impact is untenable to the ordinary mind. The lay expectation of safety, special in a premium segment vehicle, stands violated. Thus, the plaintiff's narrative indicate a frontal impact of considerable insensitivity, which from a layman prospective would reasonably warrant airbags deployment. Further, the affidavit of D2W1 reaffirms that the vehicle was functioning "as per design specification"
and that the airbags system worked properly. However, this blanket assurance is contradicted by the real world failure to deploy airbags in a confirmed frontal crash, suggesting that either the design specifications are flawed, or the ECU misinterpreted the crash. In other words, the contradictions between technical interpretation and the real world out come raises reasonable suspicion of either overly conservative threshold programming or recalibration of the ECU logic.
24. Further, the defence witnesses state that the crash was not severe enough to trigger the deployment yet both defence witnesses suggested that the vehicle's body absorbed the impact, implying that the impact was substantial but managed. It, indirectly, acknowledges that the force CS DJ NO. 11405/16 Page No. 22 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:26:47 +0530 existed but was absorbed mechanically - which raises the question should the sensors and ECU not have detected this as significant. Further, the defence witnesses again and again denied the existence of any fault caught in the airbags system and described the system as faultless and yet attributed the non-deployment to crash absorption and directional vectors, which are themselves subjective assessments. No independent or third party validation of the ECUs post crash telemetry was placed on record and it leaves a degree of doubt on whether the system was in fact working as intended under real world conditions.
25. Further, the defendants have asserted forcefully that it is not possible to define the exact triggering response of the airbags system in all possible situations since the circumstances in different types of accident will vary considerably. The defendants have relied upon the manual on airbags system which is Ex. D2W1/1. It is clearly written in the same "whether the airbags are triggered depends primarily on the vehicle deceleration rate resulting from the collision.....if the deceleration rate is below the pre-defined reference value in the control unit, the airbags will not be triggered, even though the accident may cause extensive damage to the car.....".
Thus, admittedly, there is a pre-defined value feeded in the control unit. Clearly, ECU of the car is like an AI and it cannot decide everything on its own. ECU being AI like computer, has to be fed with data and record and there is difference between belief/assumption and data and record. ECU is to work on data and record and not on the basis of presumption or assumption that the exact magnitude or specification of threshold value cannot be provided as a document. ECU must have assessed the crash on the basis of quantum of force, severity of the collision and this data must have been calibrated in the ECU and it is not like a human being who once trained, can work on its CS DJ NO. 11405/16 Page No. 23 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed PRABH by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:26:51 +0530 own discretion. Moreover, even the discretion of human being is questionable and therefore, even if ECU has assessed the nature of accident as per its discretion, then the discretion of ECU is also questionable and defendants cannot take plea that the assessment of ECU with respect to nature of accident is conclusive.
26. Further, both the defendants witnesses, specially D2W1 being technical expert of defendants deposed that airbags deploy in "moderate to several frontal crashes and he seems to justify non- deployment by citing variable like angle, force dispersion etc., suggesting that even a frontal tree impact can fall below threshold. It dilutes the clarity of what truly qualifies as a moderate frontal crash - contradicting the earlier straightforward criteria. The Court note that while technical evidence provided by defendants does offer a plausible explanation, the non-deployment of airbags in a frontal tree collision does not inspire consumer confidence and reflects, at minimum, a gap between engineering standard and real world safety expectation.
27. From the above discussion, it is clear that plaintiff has been able to made out a case of deficiency in expected safety performance. The defendants claimed that airbags system was not faulty and yet they admitted that airbags did not deploy in a frontal collision with a tree which by a reasonable perception should qualify as a moderate to severe crash and it creates conflicts that either the system wrongly assessed the crash as a minor or the threshold logic was inadequately calibrate even though defendants asserted both were correct.
It is settled principle that the scope of law of tort is wider than the scope of complaint under Consumer Protection Act where plaintiff is to prove "the defect" while in the civil case for damages under law of CS DJ NO. 11405/16 Page No. 24 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:26:56 +0530 tort, the suit is to be decided balancing the scale of probabilities. In the present case, on the scale of probabilities, by showing the contradictions in the testimony of defendant's expert, plaintiff has been able to caste a doubt whether the non-deployment was truly a result of well functioning system or whether the system's logic or calibration itself may be flawed, despite the expert insistence otherwise. Moreover, the law of tort is an uncodified law where the scope of granting the relief is evolving every day and thus, law of tort is also evolving day by day. Who thought that damages for defamation can be claimed on the basis of one whatsapp message on the group or on the basis of one post on social media. It is high time where Courts have to balance between the legitimate expectation of the consumers who trust the big brands assuring the better quality and safety and the commercial interests of the brands. We are in an era where we cannot say 'naam mein kya rakha hai', rather it is the era where we sing 'naam chalta hai'. If the only purpose of consumers is to check upon the time, nobody is going to buy a Rolex watch. Similarly had the intention of plaintiff only to commute by a car, even the Nano worth Rs. 01 lac would have served the purpose but if the plaintiff had bought the Audi car trusting the brand 'Audi', the defendants being encashing the brand name had higher accountability towards the plaintiff than a normal merchant selling the goods. In such a scenario, where a feature as critical as airbags is promoted as a safety corner stone, the onus to demonstrate compliance with technical protocol shifts to the manufacturer and distributor. This is especially true in premium vehicle segments where expectations are defined by brand assurances. Audi, as a global brand, leverages its safety record in its marketing and the consumer CS DJ NO. 11405/16 Page No. 25 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:27:00 +0530 reasonably expect those system to perform in the critical movement. Failure to deploy airbags without proof of why it did not occur - combined with lack of post-crash diagnostics - weakens the credibility of the defence. In the present case, the failure of the airbags to deploy in a frontal impact constitute a deviation from reasonable safety expectations and creates a presumption of fault in calibration or sensor performance, which the defendants have not conclusively rebutted. Therefore, considering the plaintiff's anguish and the potential risk involved, plaintiff is justified in feeling that there was a failure of promised protection, even if no physical injury occurred, accordingly, plaintiff is entitled for damages for deficient in expected safety performance.
28. Calculation of damages:
Admittedly, AR of plaintiff /PW-1 has not received any physical injury during the accident. Admittedly, plaintiff had already sold the car in question as deposed by PW-1 during his testimony that in 2012 plaintiff was constrained to sell of the car for Rs. 16,70,000/- as it was regularly getting stationed at the workshop for regular repair. PW-1 has relied upon the job card to show that car was getting stationed at the workshop from time to time.
The argument that plaintiff had sold the car in 2012 does raise questions of maintainability regarding damages sought in 2015. However, the suit is based not only on ownership but on the incident of alleged deficiency at the time of use. Thus, the sale of car later is immaterial to the cause of action routed in the 2009 accident.
The plaintiff has claimed Rs. 70,00,000/- for mental agony and business loss and it appears exaggerated in the absence of quantified CS DJ NO. 11405/16 Page No. 26 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:27:04 +0530 loss data. Plaintiff has not filed any audit report or client withdrawal letter showing loss of business owing to mental distress. However, that does not negate the occurrence of distress all together because the claim is not just about post sale in convenience but about the failure of a feature that could potentially have life saving implications.
It is further contained by the defendant that continued usage of the car by the plaintiff post accident nullified his claim of trauma or loss. While continued usage may diminish the rate of the claim in terms of functionality, it does not dilute the fact that the incident created a legitimate apprehension in the plaintiff's mind. The expectation from a safety system is its activation in a life threatening moment - not routine functionality. Post incident use may reflect lack of immediate alternative rather than satisfaction with the vehicle. Further, it is judicially recognized that emotional distress can co-exist with functional usage, especially where high end purchases are involved. The consumer here had no choice but to continue usage to recover part of the investment. This continued usage cannot be interpreted as a waiver of grievance, specially when the grievance is about the performance during an exceptional situation.
On the matter of actual financial loss, the plaintiff has already recovered Rs. 17,40,278/- through insurance and Rs. 16,70,000/- through the resale of the car. What remain is the amount of Rs. 3,70,357/- paid out of pocket and the residual grievance arising from the deficiency. The litigation cost of Rs. 10 lacs also seems excessive and not backed by any proof like legal invoices or detailed billings. Therefore, the exaggerated or unquantified claim for business loss without documentation must be approached cautiously. As the plaintiff CS DJ NO. 11405/16 Page No. 27 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:27:08 +0530 has already received substantial amount after selling the car, plaintiff is not entitled for any damages towards supply of defective car.
29. The plaintiff has relied upon the judgments: FORTUNE INFRASTRUCTURE VS. TREVOR D'LIMA"(2018) 5 SCC 442; "TROJAN AND COMPANY VS. RM NN NAGAPPA CHETTIAR", (1953) 1 SCC 456; "R.K. MALIK VS. KIRAN PAL" (2009) 14 SCC 1';"GHAZIABAD DEVELOPMENT AUTHORITY VS. UNION OF INDIA AND ANR". (2006) 6 SCC 113; "M.N. GANGAPPA VS. A.N. SETTY AND CO"(1973) 3 SCC 406; "MAULA BUX VS. UNION OF INDIA (1969) 2 SCC 554; KANCHAN UDYOG LIMITED VS. UNITED SPIRITS LIMITED(2017) SCC 237; TOMMORROWLAND LIMITED (EARLIER KNOWN AS TOMORROWLAND TECHNOLOGIES EXPORTS LIMITED) VS. STERLING HOLIDAY FINANCIAL SERVICES LTD. MCDERMOTT INTERNATIONAL INC VS BURN STANDARD CO. LTD. AND ORS. (2006) 11 SCC 181; M. LACHIA SETTY AND SONS LTD. VS. COFFEE BOARD, BANGALORE (1980) 4 SCC 636; KAILASH NATH ASSOCIATES VS. DELHI DEVELOPMENT AUTHORITY (2015) 4 SCC 136; MURLIDHAR CHIRANJILAL VS. HARISHCHANDRA DWARKADAS AND ORS. AIR 1962 SC 366.
The judgments relied upon by the plaintiff propound and reiterated the well settled legal principles with respect to award of damages but those are not applicable to the facts in hand because admittedly, plaintiff had sold out the car during pendency of his claim for damages towards manufacturing defect and no proof of actual or special injury has been brought on record.
30. The defendant no. 1 and 2 have relied upon following judgments:
"a) Brijesh Saxena Vs. Skoda Auto AS", I (2015)CPJ 235/NC;
The facts of the judgment are not applicable to the facts in hand as in the said matter the plaintiff had taken contradictory stands as at one place, plaintiff stated that airbags did not open and on the other CS DJ NO. 11405/16 Page No. 28 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:27:12 +0530 hand, plaintiff stated that airbags were not deflated. Further, the person sitting next to the driver survives the crash and Court held that airbags mechanism did function during the collision. However, in the present suit admittedly airbags have not deployed and the defence of defendants is that the collision was insufficient to meet the threshold for opening of airbags.
b) "Lajwanti V/s Volkaswzgen Group Sales India Pvt. Ltd. & Anr."(2016 SCC Online NCDRC 2092) Similarly the judgment is not applicable the facts in hand because in the said matter collision was not frontal collision but was side collision and therefore, it was held that non-deployment of airbags was justified. However, in the present case, admittedly it was a frontal collision with tree.
c) Honda Cars India Ltd. through its Zonal Office Vs. Ushat Gulgule" (2024 SCC Online NCDRC 49) Similarly, the judgment is not applicable to the facts in hand because in the said case, admittedly the injured was not worn seat belt and the same was attributed as a reason for the airbags not opening at the time of accident. While in the present case, admittedly the driver of the car /PW-1 was wearing the seat belt at the time of accident.
d) Balwan Singh Vs. Toyota Kirloskar Motor Pvt. Ltd. & Ors."(2023 SCC Online NCDRC) The judgment is also not applicable to the facts in hand because in the said case the defendants have taken the plea that vehicle was not made available to them for investigation while in the present matter, admittedly defendant no. 3 had given details /case file to defendant no. 2 who has further shared the same with defendant no. 1. Moreover, CS DJ NO. 11405/16 Page No. 29 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:27:16 +0530 throughout trial defendants have nowhere taken the objection that they never had the opportunity to make a technical investigation qua the car in question.
e) Gaurang Kanth Vs. South End Honda & Anr Ors" (First Appeal no. FA/237/2018) Further, the judgment is not applicable to the facts in hand because in the said case the driver of the car drove the car for one year without any fault and thereafter, on the faithful day the driver of the car did not stop the car despite the fact that it had started giving all sources of disturbing sound and it was running in hiccups.
f) "Sushila Automobiles Pvt. Ltd. Vs. Dr. Birendra Narain Prasad & Ors.(MANU /CF/0076/2010) Similarly, the judgment is not applicable to the facts in hand because in the said case the main allegations were that accessories was not supplied in the beginning and there were some minor defect for which car has been sent to the dealer. While in the present matter the issue before the Court was whether non-deployment of airbags in frontal collision was justified or not.
g) "Mahendiran Vs. Mahendra & Mahendra Ltd."
Similarly, the judgment is distinguishable to the facts in hand because as there were allegations of deficiency in service and not of the manufacturing defect as in the present case.
h) "Classic Automobiles Vs. Lila Nand Mishra & Ors"(MANU /CF/0086/2009) Similarly, the judgment is not applicable to the facts in hand because in the said matter the car was glowing the check light indicator even during running of the car and dealer had not supplied catalytic CS DJ NO. 11405/16 Page No. 30 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:27:21 +0530 converter and the car had not met with any accident as in the present case.
i) "M/s Manpreet Travels Vs. Tata Motors Ltd & Ors"(First Appeal No. 1447 of 2012) The facts of judgment are also distinguishable as in the said car was burnt and allegations of manufacturing defects were made but no specification of the defect was given while in the present case, plaintiff has made allegations of specific manufacturing defect i.e. non- deployment of airbags during frontal collision.
j) "Sukhvinder Singh Vs. Classic Automobile & Anr. "(Manu /CF/0653/2012 Similarly, the facts of judgments are not applicable to the facts in hand because there were allegation of over heating of the car and the said defect was removed and there was no evidence that the said defect was repeated.
k"Chandeshwar Kumar Vs. Tata Engineering Loco Motive Co. Ltd. and Anr."(MANU/CF/0389/2006) The facts of judgments are also distinguishable as in the said case there was no allegation of any specific manufacturing defect except that vehicle was frequently sent to work shop for repair.
"Smriti Debbarma (Dead) Vs. Prabh Ranjan Debbarma & Ors"(2023 SCC Online SC 9) Similarly, the facts of judgments are not applicable to the facts in hand.
Tata Motors Pvt. Vs. Sh. Manoj Gadi and Sanya Automobiles Pvt. Ltd. "(2014 SCC Onnline NCDRC 160) As far as judgments are is concerned it is also distinguishable to CS DJ NO. 11405/16 Page No. 31 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 PRABH Digitally signed by PRABH DEEP DEEP KAUR Date: 2025.04.28 KAUR 17:27:26 +0530 the present suit as in the said suit, complainant purchased second hand car and it was not met with any accident as in the present case.
31. Given the absence of injury, acknowledging the potential risk to life and mental agony caused due to failure of an expected life saving mechanism, the plaintiff is entitled to compensatory relief for breach of safety assurance. Therefore, taking a balance approach, it is held that plaintiff is entitled for damages for Rs. 10 lacs towards mental agony, risk endured and for breach of safety assurance i.e. a refund of out of pocket repair cost i.e. a sum of Rs. 3,50,000/-(approx.) alongwith the cost of suit. The defendants are advised to produce, in future similar dispute, complete diagnostic and crash telemetry record to allow independent judicial scrutiny. However, no punitive damages are awarded due to absence of malafide intent on part of manufacturer.
32. Plaintiff has also sought interest at the rate of 18% per annum from the date when defendants refused the claim of plaintiff for the first time till the payment is made. Admittedly, plaintiff has not received any substantial injury during the accident and it is the case only legal sine jure where the question of principle was involved. The plaintiff had already sold the vehicle for substantial amount in the year 2012 only. Therefore, plaintiff is not entitled for any interest prior to the date of judgment. In case defendants fail to pay the decreetal amount within two months, plaintiff will be entitled for the interest @ 7% per annum till its realization.
33. In view of the abovesaid discussion, issue nos. 1 to 3 are decided in favour of the plaintiff and against defendant no. 1 and 2 and issue no. 4 is decided in favour of defendant no. 3 and against the plaintiff and thus, suit is dismissed against defendant no. 3.
CS DJ NO. 11405/16 Page No. 32 of 33 M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025 Digitally signed by PRABH PRABH DEEP KAUR DEEP KAUR Date: 2025.04.28 17:27:35 +0530 Relief.
34. In view of aforesaid reasons, the suit of the plaintiff is decreed in favour of plaintiff against defendant no. 1 and 2 for following reliefs i.e.
a) Damages for Rs. 10 lacs towards mental agony, risk endured and for breach of safety assurance.
b) A sum of Rs. 3,50,000/-(approx.) which plaintiff paid towards repair charges of the vehicle beyond the insurance amount paid by the insurance company.
c) No punitive damages in form of charges towards supply of defective vehicle due to absence of malafide intent on part of manufacturer.
d) Cost of suit is also awarded in favour of plaintiff.
In case defendant no. 1 and 2 fail to pay the decreetal amount within two months, plaintiff will be entitled for the interest @ 7% per annum till its realization. The defendants are advised to produce, in future similar dispute, complete diagnostic and crash telemetry record to allow independent judicial scrutiny.
The suit of the plaintiff is dismissed against defendant no. 3. Decree sheet be prepared accordingly.
Digitally signedFile be consigned to Record Room. PRABH by PRABH DEEP KAUR DEEP Date:
2025.04.28 KAUR 17:27:39 +0530 Typed to the direct dictation and (Prabh Deep Kaur) announced in the open court DJ-05/South East District on this 26th April, 2025 Saket Courts, New Delhi.CS DJ NO. 11405/16 Page No. 33 of 33
M/S ROHAN RESORTS PRIVATE LIMITED Vs. AUDI AG Dated 26.04.2025