A.M.DINESH KUMAR vs Hindustan Motors Ltd.

THIS complaint is filed under Section 12 of the Consumer Protection Act.

BRIEFLY stated, the material allegations in the complaint are as follows: Attracted by the wide spread advertisement about the high qualities of Ambassador Nova Deluxe Diesel Car manufactured by opposite party No. 1 and believing the said representations to be true and correct and on being informed that the opposite party No. 1 is the Premier Manufacturer of automobiles in India, complainant was induced to place an order for the said car with opposite party No. 3, the agent of the 1st opposite party. The total price of car Rs. 2,26,425/- was paid in advance to the 3rd opposite party on 5.12.91 as pay order on the Federal Bank Ltd. Opposite Party No. 3, with whom the sister concerns of the complainant had earlier dealings, agreed to take delivery of the vehicle allotted to him from 2nd opposite party, the Branch Office of the same company. Accordingly the complainant authorised opposite party No. 3 to take delivery of the vehicle from opposite party No. 2. On 18.12.91 the car was delivered by the opposite party. An additional amount of Rs. 220/- was claimed on the ground of price hike which was paid by the complainant. After taking delivery, the complainant inspected the car and found it to be in shabby conditions. Though the complainant orally represented to 3rd opposite party about the complaints no action was taken. Therefore the complainant sensations of the complainant, he caused a registered lawyer notice to be sent to the opposite parties. The opposite parties 1 and 2 did not reply to the same till this date. Opposite party No. 3 sent a reply. The complainant purchased the car for the personal use of the complainant and believing the representation made in the advertisement. For purchase of car amounts were advanced to the complainant by the Federal Bank of India and the complainant was liable to pay interest at the rate of 23.75% per annum on the loan amount. The complainant is not in a position to make use of the car which he was compelled to purchase due to his urgent necessity. The car is now lying in the garage of the complainant like a museum piece. The request of the complainant to the opposite parties to take back the car and keep it in their custody has not been heeded to. The complainant has paid an amount of Rs. 5020/- towards Insurance, an amount of Rs. 1550/- towards delivery charges, Rs. 100/- towards registration charges and Rs. 100/- towards Surveyor''s fees. He also was forced to spend an average amount of Rs. 100/- as conveyance charges due to lack of vehicle and the opposite parties are bound to pay the complainant at the rate of Rs. 100/- per day towards conveyance charges. Serious inconveniences and mental agony also have been caused to the complainant and he was entitled to compensation addressed the opposite parties drawing their attention to the defects noticed which were also detailed in the letter and requested for substitution of the car which was neither serviceable not in accordance with the specifications. On receipt of this letter, opposite party No. 3 informed the complainant that the vehicle would be inspected by the Assistant Regional Manager (Service) of opposite party No. 1 at 10.30 a.m. on 8.1.92. Accordingly the vehicle was produced before him. The Asstt. Manager was convinced that the vehicle suffered from defects detailed in the complainant. As per letter dated 15.1.92 the opposite party No. 3 requested the complainant to send the vehicle for carrying out "rectification of the complaint". The complainant made it clear to the Asstt. Regional Manager of the opposite party No. 1 and Branch Manager of opposite party No. 3 that he would not be satisfied with the repair of vehicle and the vehicle had to be substituted. The complainant called upon the opposite parties as per letter dated 20.1.92 to substitute the vehicle and to compensate him for the loss and damage caused to him. Although the letter was acknowledged the opposite parties did not care to take any action.

The complainant got the vehicle surveyed by a licensed Surveyor. Various defects and deficiencies were noticed by the Surveyor. Since there was no response from the opposite parties to the written and oral report for the same. It is clear from the Surveyor''s report that the car supplied to the complainant was defective and damaged. In the circumstances the complainant was entitled to get the car substituted by a new car or get refund of the amount paid towards the price the additional amount and the other expenses referred to above. The complainant is also entitled to get compensation for the loss and damages and mental agony, which was estimated at Rs. 50,000/-. He was also entitled to get refund of Rs. 200/- an excess amount collected from the complainant. On these allegations the complainant sought an order directing the opposite parties to substitute a car and to pay compensation. The complainant estimates his alternative relief at a total sum of Rs. 2,91,715/- and interest at the rate of 18% per annum and costs.

THE first opposite party filed a version contending that the complainant is not a consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act as the car was purchased for commercial purpose. It was also averred the company was registered under Section 26 of the MRTP Act and the subject matter of the complaint is therefore outside the purview and scope of Consumer Protection Act. THE car was purchased by the complainant from the opposite party No. 2 at Pondicherry and therefore, this Commission has no jurisdiction to entertain the complaint. THE complainant does not relate to complaint of after sub-service under the warranty and on this ground also complaint is without jurisdiction. It was also barred by limitation. THE various allegations in the complaint were denied. THE contention of the complainant that the first opposite party authorised opposite party No. 3 to take delivery of the car in the belief that the car will be brand new one, is wholly irrelevant and after thought. THE opposite party No. 2 is only a dealer and not an agent and is carrying on the business of buying and selling of motor cars independently. THEre is no privity of contract between the complainant and the company. THE first opposite party has no obligation to the customers of opposite party No. 2 save and except under the terms and conditions of warranty given by the company which is duly accepted by the customers. THE relationship between the 1st opposite party and opposite party No. 2 is on principal to principal basis. THE application made and/or benefit under the said warranty shall depend on compliance of the procedures as stipulated in the maintenance voucher book provided to the complainant while purchasing the car and any deviation therefrom by the customers shall render the warranty in operative and the same shall cease to apply. THE first opposite party is not award of the collection of Rs. 220/-. THE complainant took delivery of the car after proper road trial and only after being satisfied with its performance. THE first opposite party also denied the alleged defects and deficiencies in the car and also the allegations of widespread rust, shabby body condition etc. THE complainant failed to avail the free initial services which is prerequisite and mandatory for availing the benefit under warranty and this shall render the warranty inoperative and the same shall cease to apply. THE complainant was using the car without any trouble and filed this complaint for some speculative gains. THE opposite party No. 1 also denied the allegation that the car required replacement. THE company also advised the complainant to make the car available at the workshop of opposite party No. 3 but the complainant failed to comply with the same and instead started making false allegations with some ulterior motive. THE report of the Surveyor as to the alleged defects of the car is wholly baseless and untrue. THE company had no notice complaining that any service was required to be rendered and was not rendered under warranty. THE complainant has not suffered loss of damages and is not entitled to any relief. The 2nd opposite party also filed a version for himself and also for 3rd opposite party. It was admitted that the complainant booked for one Diesel Ambassador Nova Deluxe car on 6.12.1991 with the 2nd opposite party and an amount of Rs. 2,26,465/- was paid and it was agreed to supply the car and the car was accordingly delivered on 6.12.1991. The delivery was taken after full satisfaction of the quality and condition of the vehicle. Thereafter, the vehicle was brought to Calicut Branch for further inspection and servicing and taken back on satisfaction of the perfect condition/efficiency of the vehicle and receipt was issued to the Branch by the complainant on 23.12.91. Rs. 220/- was collected towards price difference. The allegations that the car had major defects and there was widespread rust, and shabby body condition were denied. On 9.1.92 the Asstt. Regional Manager (Service) Hindustan Motors Ltd. accompanied by the Asstt. Branch Manager called on the complainant and discussed with the complainant and then the complainant was informed to bring the vehicle on any working day to carry out the rectification if any required, but the complainant refused to do so despite repeated request. A registered letter was also sent on 15.1.1992 requesting to bring the vehicle to which also the complainant did not respond. The complainant sent a registered letter on 20.1.1992 for total replacement of the vehicle. The defects being trivial, the complainant is not entitled to get replacement of vehicle. There is also no deficiency of service. Complainant requires elaborate evidence and therefore proper remedy of the complainant was only to approach a Civil Court. Complainant filed a petition before M.R.T.P. Commission the same cause of action and for this reason also the complaint is liable to be dismissed. 6. On behalf of the complainant PW1 and PW2 were examined and Exbts. P1 to P11 marked and on behalf of the respondent RW1 was examined and R1 to R3 were marked.

THE following points arise for consideration: 1. Whether the complainant is a consumer ? 2. Whether this Commission has jurisdiction to entertain the complaint. 3. Whether the car supplied by the opposite parties had such defects as would require replacement of the car by a new car ? 4. Whether the complainant is entitled to any other reliefs. 5. What is the order as to cost ?

Point 1. The 1st question to be considered is whether the complainant is a consumer. It is not disputed that the complainant purchased the car in question for consideration. However the opposite party contended that the car is purchased for his business purpose and therefore he is not consumer within the meaning of Section 2(1)(d)(1) of the Consumer Protection Act. According to learned Counsel for the opposite party the complainant squarely comes under the last part of the above definition, namely "does not include a person who obtains such goods for resale or for any commercial purpose". In his evidence PW1 has stated that the vehicle was purchased for his personal use. The opposite parties have no case that the vehicle was purchased for resale or to be used as taxi. What is contended for is that the complainant will use the car exclusively in connection with his business. There is no acceptable evidence to support this. A person may use his car for going to his business premises or to a hotel for discussion with his business customers. We do think that these acts will bring the case within the mischief of the clause quoted above. If only a person purchases a car for resale or for any commercial purpose, the above clause will be attracted. Therefore, we have no hesitation to hold that the complaint is a consumer within the meaning of Consumer Protection Act. Another contention raised by the complainant is that this Commission has no territorial jurisdiction to enterain this complaint. It is contended that no part of cause of auction has arisen in the State of Kerala. PW1 has deposed that the car was booked at the Kozhikode Branch of Marikar Motors, the 3rd opposite party herein. He also deposed that he authorised the 3rd opposite party to take delivery and accordingly the 3rd opposite party took delivery from the 2nd opposite party and brought the vehicle to Kozhikode and vehicle was delivered to the complainant at Kozhikode on 18.12.1991. He further stated an excess amount of Rs. 220/- was collected from him at the time of delivery. The 3rd opposite party''s business premises is also situated in Kozhikode. In the cross-examination also PW1 stated that payment was made in Kozhikode Branch, though the amount was encashed at Pondicherry. In these circumstances at least parts of cause of action have arisen at Kozhikode within the jurisdiction of this Commission and so the contention that this Commission has no territorial jurisdiction cannot be accepted.

YET another contention raised is that the complainant has approached M.R.T.P. Commission for the same relief and therefore it would not be proper to entertain this complaint filed before this Commission. PW1 was cross examined on this aspect and he stated that though he sent a letter to M.R.T.P. he did not get any intimation from M.R.T.P. He also stated that he did not seek any relief from M.R.T.P. There is no evidence to support the plea that any petition is pending before M.R.T.P. Though such a contention is raised in the version, no serious argument is advanced based on this plea. We therefore hold that there is no evidence to show that the complainant is seeking concurrent remedies before this Commission and M.R.T.P. Accordingly we reject this contention as well.

THE most important point to be considered in this O.P. is whether the vehicle supplied had major defects warranting replacement of the vehicle. According to the complainant there were major defects and the defects are such as to necessitate replacement of the vehicle by a new vehicle. According to the opposite parties the detects were all minor and could be easily rectified but the complainant did not cooperate to rectify the defects and in the circumstances the complainant is not entitled to any relief. According to PW1 after taking delivery, the complainant inspected the car and found the car in a shabby condition and though the complainant orally informed the 3rd opposite party about this, no action was taken. THErefore the complainant sent a registered notice Exbt. P3 pointing out the following defects of the car and requesting to replace the car by a new car. 1 THE steering Jercks vehemently producing terrible noise. 2 THE front left door is not in proper position. It is hanging down and has marks of having been dashed against some hard substance. 3 THE vehicle has not been polished properly. THEre is no paint on many parts of the vehicle. THE bare body is visible on such parts. THE vehicle on the whole lacks the appearance of a new one. 4 THEre is leakage of both gear oil and housing oil. 5 THE third gear is not in position. When changing gear, it produces noise. 6 THEre is no grill beading at all. 7 THE beading of Back glass is quite imperfect. While washing the Car, water trickles down through the openin g in the beading. 8 THE beading on the whole inside of the car is quite imperfect. 9 Rust is seen on several parts of the vehicle, mainly on the top of the front portion, in the dick and near the Engine. 10 THEre is only spot welding causing dust and noise inside the car. 11 THE Back Seat has no foam and digs in while sitting on it. 12 Dick is shapeless. Water sweeps in through the joints. 13 All the four cudguards are in an unfinished condition, with scraps protruding and rusted.

Pw1 in his evidence also has spoken about these defects noticed by him. The complainant received Exbt. P4 reply dated 4.1.1992 which stated that the Asstt. Regional Manager (Service) of M/s. Hindustan Motors Ltd. would be visiting Kozhikode. The complainant was also requested to produce the vehicle at 3rd opposite party''s office at Nadakkavu at 10.30 a.m. on 8.1.1992 for inspection and for further action. Accordingly vehicle was produced. Thereafter the complainant got the vehicle inspected by Pw2 a licensed Surveyor and loss Assessor on 13.1.92. He prepared Exbt. P5 report in which the following defects were pointed out. 1. Front grill is fitted without outer rubber heeding on LG half. 2. Water channels between front mudguards and valance have reddish brown coating - showing signs of rusting. 3. RH running board lower surface is rusted. 4. RH running board rear end welded seam with floor board is overlapping and has abnormal gap. 5. Metal beeding gripping floor mats with running boards are not secured properly. Surface of these beedings are of wavy form. 6. RH rear mudguard arched portion surface is in wavy form and sharp edges of metal are protruding. 7. RH side roof water channel has reddish brown coating throughout its length - sign of corrosion. 8. Roof panel upper surface paint is scraped at some portions. Also paint finishing is improper. At some portions the roof panel is rusted. 9. Rear glass rubber beeding is twisted, thereby water seeps into cabin. 10. Surface of dick floor paint has been scrapped badly. 11. Metal sheet joints are not properly surfaced. Sharp edges are protruding. 12. Both junction of metal panels at rear bumper brackets, paint is cracked into lumps.

Dick lid lower water channels have reddish brown coating - sign of corrosion.

FRONT left hand door panel has wavy form and its paint coating is rough. Garnish mould beedings fixed to doors and body shell have contorted.

SEAT upholstry is stained and has shabbied appearance. Rear seat has no cushioning effect. Metal beedings at rear mudguard have black coloured surface at their sides and do not look new.

BOTTOM portions of all doors are rusted.

LUBRICATING oil is leaking from timing gear case. Lubricating oil is also leaking from sump rear collar.

Gears are noisy while engaging in third position.

STEERING assy jerks abnormally with noise. He concluded the report as follows: "On the whole the car body finish is unsatisfactory. Its painting is not upto the standard one expects of a new deluxe car. The car upholstery also is not upto the standard. Mechanical defects as mentioned, are not expected of a brand new car, the odometer of which registers only 2731 Km. at the time of my inspection."

PW2 is an experienced Surveyor of 21 years standing as a Surveyor and loss Assessor. He has diploma in mechanical automobile Engineering. He deposed that PW1 asked him to inspect its Hindustan Ambassador Nova Diesel Car and give a report of the condition of the vehicle and accordingly he inspected the vehicle and the report he prepared is Exbt. P5. He also stated that he took photos of the damage. Exbt. P12 series are the negative of photo and Exbt. P13 series are the photos showing the damages of the car. Items 1 to 19 in Exbt. P5 related to the defects in the body and items 20 to 23 are the defects in the mechanical parts. PW2 further stated that at the time when he inspected the car meter reading was 2731 Kms. There was rust in several places of body such as running board, gear dick and the upholstery parts and according to him about 65% of the body was affected by rust. Rust was seen on the door, rear dick, running broad also on the side of upholstery. According to him normally rust of this kind would appear only after use of two or three years. He also stated that the painting on the floor board of the dicky was completely scrapped. Such rust would appear on the vehicle only when used for a long period. Items 20 and 21 are engine defects. He stated the defect in item 22 was due to the defect in the synchroniser and such defect can not be seen in a vehicle used only for a distance of 2700 Kms. He also spoke of defect in the bearing gear. In his view the car has run much longer distance than what is indicated in the audometre. In the course of cross-examination, he stated that the vehicle was kept in the shed and defects were noted on his inspection of the vehicle in the shed. He inspected the car in the rainy season but did not see any leakage to the shed thatched with cadjan leave and covered on sides and according to him the defects were not minor. He denied the suggestion that he gave the report in order to help the complainant. His profession is to assess the damage of vehicle involved in accident. He is an Engineer and Mechanic also. He has acquired diploma in Automobile Engineering which was awarded by the Indian Air Force. AMIE diploma was obtained through the correspondence course, after his discharge from the Indian Air Force. He stated DME qualification is recognised by the Ministry of Rehabilitation and approved by the Controller of Insurance. The witness was cross-examined at length on different systems of the vehicle and answer was elicited from him that most of these complaints were not related to systems. An attempt was also made to establish that the witness is not familiar with various systems. However we are not satisfied that he was not qualified to examine the condition of vehicle and make a report. He stated that he put the car on jack and started engine and applied all the gears. He admitted complainant No. 1 could be rectified in service. He deposed complaint No. 2 could be due to non-use of the vehicle for a long period. Item No. 2 requires some patch works. The witness also admitted that these defects also could be rectified. In the re-examination he repeated that this kind of rust could be found only after long use. 14. As against this evidence, RW1 was examined. He is an Assistant Regional Manager of Hindustan Motors Ltd. He deposed that he has 13 years of experience and he had inspected the vehicle supplied to the complainant. He noted the defects and directed the complainant to hand over the vehicle to authorised dealer''s service centre to cure the defects. According to him, all the defects are very minor. During the initial warranty service there could arise such defects. He further stated that the opposite party did not send the vehicle for repair and the opposite party sent registered letter to the complainant requesting to produce the vehicle and still they did not turn up. Ever since the delivery, the vehicle was under the custody of the complainant. Due to parking of the vehicle without maintenance the condition of the car would get deteriorated. If the complainant had brought the vehicle for repairs, defects could have been rectified in the initial service itself. He further stated that items 11 to 19 are minor defects. The opposite party has issued warranty and they would have rectified all these defects. Complainant did not make use of the warranty. Complaints 1 to 19 are not related to power generation system and they are only defects on the body of the car. To cure the defect shown in item No. 20 only 5 minutes time was required. Defect No. 22 is minor leakage and by adjustments it could have been rectified during service. Item No. 22 can be corrected. When he inspected the vehicle he found it as a new brand vehicle. During the course of cross examination he admitted that the defects mentioned in the letter given by the complainant was substantially the same as in the survey report. He also admitted that within one week of inspection, there cannot be substantial deterioration. He stated by Exbts. P7 and P8, the complainant called upon them to take back the vehicle and to keep it with them, but they did not take back the vehicle. He further stated that if the car is kept in open place without roof and exposed to all weather conditions the vehicle will start rusting. He admitted that the car had run a distance of only 2731 Kms. which includes the distance of run from Calcutta to Pondicherry and Pondicherry to Kozhikode. To a suggestion that if corrosion and rust are found on the vehicle within one month of taking delivery it could only mean the vehicle is old, he replied that any vehicle plying in dirty water or accumulated water and if it is not serviced, chances are there, but we cannot say that it is an old one. He stated the rusted area on the body of the car is 10 to 20% and according to him these are anti rust coating area. That area does not require painting. The areas stated in the report are anti rusted area. To a question whether many of the defects shown would not indicate long usage be replied in the negative. To a specific question whether he expects all these defects in a brand new car within a period of one month, he replied it may be possible. He further stated that there is no provision to return of the car and Exbt. P9 reply was given to that effect. 15. The question to be considered is whether the defects pointed out in Exbt. P1 letter and also Exbt. P6 report are such defects as would warrant a demand for replacement of the car and the failure to replace the car on the part of the opposite parties would amount to deficiency in service. The complainant purchased a new car paying full price and would normally except to get a trouble free car having good appearance and free from defects. It is true that the opposite party requested the complainant to produce the vehicle and offered to repair the car and cure the defects. The complainant was not willing to this course. According to the complainant who was examined as PW1 the defects found on the car cannot be expected of in a brand new car and, therefore he was entitled to replacement of the vehicle. In the evidence of PW 2 and the survey export Exbt. P6 prepared by him the defects have been pointed. He is an independent witness. He had long experience as a licenced Surveyor and loss Assessor and in that capacity had occasion to inspect various vehicles. He got diploma in Mechanical and Automobiles Engineering and had a licence to work as Surveyor and loss Assessor from the Controller of Insurance. We do not find any reason for the PW2 to give a false report. It is admitted that the defects stated in complainant''s letter and found by the Surveyor in Exbt. P6 are more or less the same. Learned Counsel for the opposite parties crossexamined PW2 at length and wanted to establish that he had no requisite qualification and he had no knowledge of various systems of a Motor vehicle and that his evidence cannot be relied on. We are not very much impressed by the suggestion made by learned Counsel for the opposite parties that the PW2 was not competent to report on the conditions of the vehicle. In this context we may say that neither the opposite parties not RW1, the Assistant Regional Manager examined on behalf of the opposite parties, has a case that the vehicle did not suffer from the defects pointed out. Most of the defects were admitted but according to them all the defects were minor and could have been rectified during service and in the circumstances the demand made by the complainant to replace the vehicle is unreasonable. RW1 stated that there is no provision for taking back a vehicle which is delivered. On a careful and anxious consideration of the evidence in the case, we feel that the demand made by the complainant for replacement of the vehicle cannot be considered as unreasonable. The complainant has paid full consideration for a new vehicle and can very well expect to get a vehicle free from defects and troubles. It is true that in Indian conditions nobody can expect the same standard of performance of vehicles manufactured in advanced countries and merely because there are minor defects, the purchaser may not be justified in demanding replacement of the vehicle by a new vehicle. There is warranty and such minor defects can be rectified at the time of warranty service. Though RW1 would say the corrosion is in anti rust coating area, we are satisfied that there is corrosion in considerable parts of the bodies of the car. There are various other defects also pointed out by PW2 the Surveyor. We are unable to agree with the stand taken by the opposite parties, that once a new car is delivered there is no question of taking back the said vehicle and delivering another car. The defects pointed out are substantial and a purchaser of a new car paying full amount cannot be compelled to retain the car, which is found to suffer from various defects. Photos produced by the complainant also supports the defects pointed out by the complainant and PW2. We are unable to say that demand for replacement is on account of mere sensitiveness of the complainant. In the circumstances we feel that the failure on the part of the opposite parties to replace the vehicle with a new vehicle would amount to deficiency in service. We therefore direct the opposite parties to deliver a new Ambassador Delux Nova Car without charging higher price if any due to price hike or to refund the full price of the car together with interest at 12% from the date of payment and take back the vehicle delivered. The complainant has paid an amount of Rs. 5020/- towards insurance, an amount of Rs. 1550/- towards delivery charge as, Rs. 100/- towards registration charges and Rs. 200/- towards Surveyor''s fees. He will be entitled to get these amount reimbursed as compensation. The complainants has stated that he was forced to spend an average amount of Rs. 100/- as conveyance charges due to lack of vehicle and the opposite parties are bound to pay the complainant compensation at the rate of Rs. 100/- per day from 18.12.91. We do not find any acceptable evidence on this aspect and in the circumstances we are not in a position to award any compensation claimed by the complainant on this count. 16. The complaint is ordered as above. We direct the parties to bear their respective costs. Complaint allowed.