Asia Art Printers vs K.P. Dharmaian

THIS revision petition has been filed by Mr. Shahid, Petitioner herein and opposite party before the District Consumer Disputes Redressal Forum, ISBT, Delhi (for short "the District Forum") being aggrieved by the order of the For a below, which in their concurrent findings have allowed the complaint filed against him by Mr. K.P. Dharmaian, Respondent herein and Complainant before the District Forum. In his complaint before the District Forum, Respondent/Complainant, who is a registered exporter of handicraft items, contended that on receipt of an order from a foreign buyer for supply of 50,000 notebooks, he contacted opposite party/Mr. Shahid of M/s. Asia Art Printers. After approving a sample shown by the opposite party and on his agreeing to manufacture the said notebooks by a stipulated date, he placed an order in writing for the same and also paid him an advance amount of Rs. 4,40,000. Petitioner/opposite party, however, failed to supply the notebooks by the stipulated date for delivery and requested for a further period of two weeks, which was agreed to. However, despite this assurance, the required notebooks were not supplied, leading to cancellation of the order by the foreign buyer and consequently resulting in loss to the Respondent/Complainant. Respondent/Complainant therefore, sent a legal notice to the Petitioner/opposite party seeking recovery of the aforesaid amount of Rs. 4,40,000 along with interest @ 18% per annum from the date of receipt of the said amount upto the date of recovery. On not receiving a response, Respondent filed a complaint before the District Forum and requested for refund of the amount paid by him along with interest @ 18% per annum.

PETITIONER /opposite party on being served admitted placement of the order for 50,000 notebooks by Respondent/Complainant and advance payment of Rs. 4,40,000 in instalments. However, he vehemently controverted the allegation that the notebooks as per the approved sample were not ready by the stipulated date and stated that it was because of a problem between the Respondent/Complainant and the foreign buyer that the order was cancelled, which in fact had caused loss to him. The District Forum, after hearing the parties and on the basis of evidence filed before it, allowed the complaint. It directed the Petitioner/opposite party to pay the Respondent/Complainant a sum of Rs. 4,40,000 along with interest @ 12% per annum from the date of receipt of each instalment till the date of payment and also Rs. 1,000 as litigation expenses.

AGGRIEVED by this order, Petitioner/opposite party filed an appeal before the Delhi State Consumer Disputes Redressal Commission (for short the State Commission"), in which he reiterated that the notebooks were ready on time and had also been inspected and approved by an agent of the foreign buyer and that it was the Respondent/Complainant who did not accept/left the delivery of the goods within the stipulated period. Further, the District Forum failed to appreciate that the Respondent/Complainant being a registered exporter of handicraft items the transaction was of a commercial nature involving resale of goods. Therefore, on both counts Respondent is not a ''consumer'' as per the definition of ''consumer'' in Section 2(1)(d) of the Consumer Protection Act, 1986. In this connection, Counsel for the Petitioner/opposite party cited judgments of the Hon''ble Supreme Court in Kalpavruksha Charitable Trust v. Toshniwal Brothers (Bombay) Pvt. Ltd. & Ors., : VIII (1999) SLT 529 : AIR 1999 SC 3356 and Laxmi Engineering Works v. PSG Industrial Institute, : II (1995) CPJ 1 (SC) : (1995) 3 SCC 583. Thus, Respondent/Complainant''s remedy lay before a Civil Court.

THE State Commission dismissed the above contentions of the Petitioner/opposite party and concluded that the differences between the facts in the instant case and those in the above cited judgments "sticks out for miles" and are, therefore, not applicable to this case. The State Commission while doing so observed as follows: 10. The respondent is a single man who is engaged in obtaining the orders. Merely because there was some legal requirement of permit, etc. does not mean that he is engaged in commercial activities. Receiving of such an order is the only source of livelihood and therefore by no stretch of imagination the contract in question between the parties can be stretched to a commercial transaction or the contract. The respondent had sought refund of the amount received by the appellant because of its failure to supply the goods by the due date resulting in cancellation of the order received by it.

The State Commission also did not accept the contention of Counsel for the Petitioner/opposite party that the Respondent/Complainant''s remedy lay before the Civil Court by stating:

Hon''ble Supreme Court has also taken a view in Fair Air Engineers Pvt. Ltd. and Anr. v. N.K. Modi : 1996 (6) SCC 385, that remedy under Consumer Protection Act, 1986, is additional and independent remedy irrespective of the proceedings having been initiated under any law including Indian Arbitration Act. It is only under Consumer Protection Act that a consumer is entitled for compensation as to the mental agony, harassment, physical discomfort and other injustice done to him in addition to actual loss or injury suffered by him.

Regarding the factual matrix of this case, the State Commission observed that the District Forum had returned a finding of fact based on documentary evidence which does not call for any interference. The State Commission, therefore, dismissed the appeal of the Petitioner/opposite party but set aside the order of the District Forum regarding payment of interest @ 12% per annum on the amount of Rs. 4,40,000 and in lieu directed the Petitioner/opposite party to pay the Respondent/Complainant compensation of Rs. 20,000 apart from Rs. 1000 as litigation costs awarded by the District Forum.

Being aggrieved, the present revision petition has been filed before us.

Counsel for both parties made their oral submissions.

COUNSEL for the Petitioner/opposite party reiterated that the State Commission reached an erroneous conclusion of deficiency in service against him by not fully appreciating either the facts of the case or the legal issues involved. On facts he pointed out that the Fora below failed to take note of the evidence before them that the foreign buyer had placed an order for the notebooks on 20.4.1998 to be delivered within 30 days but Respondent/Complainant had belatedly placed the orders only on 15.7.1998 and, therefore, the foreign buyer cancelled the orders because of this ab initio delay in placing the orders by the Respondent/Complainant and not because of any deficiency on the part of Petitioner/opposite party in the timely delivery of notebooks. Further, in his letter dated 23.4.1999 Respondent/Complainant himself had admitted that the Delhi agent of the foreign buyer had indicated that 834 cartons, each containing 60 notebooks, totally 50,000 notebooks had been packed in cartons within the specified date and also that one Ganesh (a representative of the foreign buyers) who had inspected the notebooks on 15.9.1998 had not indicated that there were any defect in these notebooks. There was, therefore, no deficiency of service on the part of Petitioner/opposite party who had manufactured and packed the 50,000 notebooks which were, however, not picked up by Respondent/Complainant. On legal issues, Counsel for the Petitioner/opposite party reiterated that since the goods had been purchased for resale by Respondent/Complainant (since admittedly they were to be again sold to a foreign buyer), he was not a ''consumer'' in terms of Section 2(1)(d) of the Consumer Protection Act, 1986, wherein a consumer does "not include a person who obtains such goods for resale or for any commercial purpose". Respondent/Complainant''s legal remedy,'' therefore, lay before a Civil Court.

COUNSEL for the Respondent/Complainant on the other hand stated that the Fora below had correctly appreciated the facts of the case, which confirmed that the Petitioner/Opposite Party had failed to supply the required number of notebooks as per the approved sample by the stipulated date even though substantial payment for the same had been made in advance. Regarding the legal issue that Respondent/Complainant is not a ''consumer'' as per Section 2(1)(d) of the Consumer Protection Act, 1986, it was stated that since the Respondent/Complainant was availing the facilities and services of the Petitioner/opposite party to manufacture and supply notebooks as per particular specifications, it was not a sale per se and consequently not a resale. It was a facility of service and, therefore, is not covered by the exclusionary clause of Section 2(1)(d) of the Act, which is limited only to services free of charge and contract of personal service. The judgment of the Hon''ble Supreme Court in Rajeev Metal Works and Others v. The Mineral & Metal Trading Corporation of India Ltd., : I (1996) CPJ 20 (SC) : AIR 1996 SC 1083, cited by the Petitioner/opposite party in support of his case is not relevant to the present case.

Counsel for the Respondent/Complainant further contended that the present revision petition was barred by limitation as the appeal against the order of the State Commission was preferred beyond the period of limitation, which ended on 4.4.2008 i.e. more than 30 days after the certified copy of the order had been issued to the Petitioner/opposite party by the State Commission on 5.3.2008.

We have considered the submissions of learned Counsel for both parties and have also gone through the evidence on record. So far as the facts of the case are concerned, we note that these have been carefully gone into by the District Forum and endorsed by the State Commission and we see no reason in our revisional jurisdiction to intervene with the same more so when there is credible evidence on record that despite having received almost 90% of the total amount as advance payment, Petitioner/opposite party did not deliver the required number of notebooks as per the approved sample within the stipulated period, including the extended grace period. The contention of Counsel for the Petitioner/opposite party during his verbal arguments that the foreign buyer had actually placed the order with the Respondent/Complainant on 20.4.1998 for supply of notebooks within 30 days (i.e. 20.5.1998) is not borne out by the evidence on record since admittedly on 30.8.1998 the representative of the foreign buyers had carried out an inspection of the notebooks, which clearly indicates that the order had not been cancelled at least upto that date. Petitioner/opposite party had raised a legal issue before the State Commission that the Respondent/Complainant was not a ''consumer'' within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986, which excludes "commercial purpose" as also "resale". The State Commission has dealt with this issue at length and cited various judgments of the Hon''ble Supreme Court and thereafter concluded that since the Respondent/Complainant was a single person engaged in obtaining orders for his livelihood, he was obviously not engaged in commercial activities. Further the nature of the consumer dispute involved services availed by the Respondent/Complainant and was not merely a question of outright sale. We agree with these findings of the State Commission. As has already come in evidence, the notebooks were not purchased "off the shelf'' by the Respondent/Complainant from the Petitioner/opposite party but had been manufactured/fabricated by the Petitioner/opposite party on the basis of particular specifications indicated by the Respondent/Complainant. It was, thus, not a "sale" and consequently not a "resale" as defined under the exclusionary clause of Section 2(1)(d) of the Act but was in the nature of services which the Respondent/Complainant availed of from the Petitioner/opposite party. We also agree with the finding of the State Commission that this is not a case to non -suit the Respondent/Complainant on the ground that the transaction was of a commercial nature. No doubt Respondent/Complainant was a registered merchant exporter under the Export Promotion Council for Handicrafts but, as has been observed by the State Commission, he was a single individual involved in earning his livelihood by placing and procuring orders for the purpose of export and is, therefore, very much a ''consumer'' as upheld by the Hon''ble Supreme Court in Laxmi Engineering Works v. P.S.G. Industrial Institute (supra). Counsel for the Respondent/Complainant in his arguments before us had contended that the present revision petition should be dismissed as barred by limitation since it was filed beyond the statutory period of 30 days from the date of obtaining the certified copy of the order by the State Commission. It appears that Counsel for the Respondent/Complainant has erroneously applied Section 19 of the Consumer Protection Act, 1986 while making this submission, which is not applicable in the case of revision petitions. This case is covered by Regulation 14 of the Consumer Protection Regulations, 2005, wherein a revision petition can be filed within 90 days from the date of the order or the date of receipt of the order, as the case may be. In the instant case, the revision petition was filed well within the period of 90 days provided for filing the revision petitions.

To sum up, we uphold the order of the State Commission and dismiss the revision petition. Petitioner/opposite party is directed to pay the Respondent/Complainant Rs. 4,40,000 in addition to Rs. 20,000 as compensation and Rs. 1000 as cost of litigation awarded by the Fora below within a period of one month from the date of receipt of this order. No order as to costs.