AUTOLITE (INDIA) LTD vs APPLE INDUSTRIES LTD

COMPLAINANT M/s. Autolite (India) Ltd. is a public limited company incorporated under Companies Act, 1986 and had its office and factory at D- 469, Vishwakarma Industrial Area, Jaipur. COMPLAINANT-Company is carrying on their business of general light lamps, fixtures and auto head lights etc.

COMPLAINANT''s case is that it agreed to purchase softwares and hire the services of the opposite party for implementation of the software in the various departments of the complainant and also to hire services for training of its employees and its sister concern M/s. Anushika Industries Ltd. Opposite party by their letter No. CON/122/6433 dated 25.9.92 (Annexure-1) submitted their proposal regarding implementation of computers and also man- power development in complainant''s organisation alongwith a brief write-up on strategic planning for information system (SPIS). The opposite party also enclosed with their aforesaid letter an outline of deliverables and financial implications. The opposite party discussed the matter with complainant''s management and thereafter submitted their revised proposal vide their letter No. MKT/CON/6533 dated 27.10.92 (Annexure 2). COMPLAINANT vide their latter No. AIL/PROI/92/109 dated 28.10.92 (Annexure-3) placed an order to the opposite party on the terms and conditions mentioned therein. Rest of the order terms and conditions were to be as contained in the letter of the opposite party dated 27.10.92 (Annexure 2). The assignment was to commence from 1st week of November, 1992 and was to be completed by May, 1993. The employees of M/s. Anushikha Industries Ltd., sister concern of the complainant, were also to be trained alongwith the employees of the complainant-Company by the opposite party. The order dated 28.10.92 was duly accepted by the opposite party. The complainant had already paid a sum of Rs. 4,00,000/- to the opposite party. The complainant vide their letters dated 23.3.93 and 13.4.93 clarified to the opposite party the activities and the responsibilities of the opposite party, the programme of completion of various milestones, financial arrangements etc. The opposite party by their letter dated 31.10.93 confirmed certain works to be done as per the contract including the training and modification and HRD package software etc. Some more correspondence passed between the parties. The complainant states that as per complainant''s order dated 28.10.92, the entire assignment was to be completed by the opposite party by May, 1993, but the opposite party failed to complete the same. The work done was also found defective and unuseful. The complainant by its letter dated 20.12.93 pointed out to the opposite party that the software work given by the opposite party was being handled by them very poorly. It was also pointed out to them that out of 7 softwares supplied by them 5 softwares were not in working conditions and therefore the same cannot be called as installed. Other 2 softwares were technically of very poor quality and they also did not cover the work efficiently and completely. The complainant by its letter dated 8.1.94 specifically pointed out to the opposite party that no proper training was given, the implementation of the software supplied could be made due to certain problems in the software, errors, lack of proper demo, training and documentation. It was also pointed out to them that the software was not properly installed by the opposite party/their consultant, M/s. Bajaj Auto Ltd. It was also mentioned to the opposite party that due to problems, computerisation programme was getting delayed resulting into heavy losses to the complainant. Further letters dated 27.1.94 and 12.2.94 were sent to the opposite party to which a vague reply dated 21.2.94 was given by the opposite party. Complainant vide its letter dated 26.3.94 pointed out the mistakes in addition to previous mistakes already pointed out to the opposite party in implementing the software provided and requested . them to rectify mistakes. By another letter dated 30.3.94 it was pointed out to the opposite party that their persons would be, as per the contract, with the complainant until implementation process was over, but the persons deputed by the respondent left the complainant. It was also pointed out in the said letter that the user manual, source code and system reports were not supplied to the complainant and in many other package no work was done by the opposite party. Thereafter several letters were sent by the complainant to the opposite party as well as legal notice. Complainant-Company''s grievances are: (1) Softwares supplied by the opposite party were full of defects, imperfection in the quality, potency and standard which are required to the maintained. (2) Softwares supplied to complainant were inadequate for the performance required for a computerisation programme.

(3) Due to non-performance by the opposite party in completing the agreed work and due to defects and deficiencies in the software supplied, the complainant had suffered not only monetary losses but also in his business reputation. Complainant-Company has therefore, prayed that opposite party be directed to rectify the softwares already supplied to the satisfaction of the complainant. Opposite party be directed to supply user''s mannual, operational manual, system reports and source code immediately to the complainant. Opposite party be directed to pay a sum of Rs. 12 lakhs to the complainant as damages. Alternatively, the opposite parties may be directed to refund the amount of Rs. 4.00 lacs to the complainant alongwith interest @ 24% per annum from October, 1992 till payment. In addition a sum of Rs. 12.00 lacs to the sum of Rs. 12.00 lacs against damages caused by the negligence and failures of the opposite party. Opposite party filed its version on 4.3.95. The opposite party admites that the complainant entered into agreement with the opposite party. It is admitted that the opposite party had sent a letter on 25.9.92 to the complainant regarding implementation of computers and also manpower development in complainant''s organisation alongwith a brief write-up on the strategic planning for information (SPIS). It is admitted that the complainant had placed an order to the opposite party on 28.10.92 on the terms and conditions mentioned therein. It is stated that the opposite party were to commence the assignments from 1st week of November, 1992, but completion was subject to full cooperation of the complainant. It is admitted that it was stipulated that the employees of M/s. Anushikha Industries Ltd. will also be trained alongwith the employees of the complainant- Company. With regard to complainant''s letter dated 30.10.93 (Annexure-5), the complainant had said that 85% formats were given to the opposite party and remaining 15% would be sent shortly. Other documents referred to by the complainant in the said letter had got nothing to do with the present contract.

Case of the opposite party is that it started the consultancy assignment on November 17,1992 with a top management, but work- shop strategic planning for information technology based on the interviews with the top management conducted by their principal consultant O/r. M.S. Jayaraman. Opposite party submitted a critical success fact report on 15.12.92. At the same time, they had also done the requirement specification for various departments, in consumption with Bajaj Auto Ltd., Pune, a report to the effect of system requirement specification was submitted on 6.12.92, clearly stating and requesting a feed-back on the study conducted, after which only the slow development would start. Since their consultant was present through- out the duration, the complainant-Company had verbally expressed that they did not require any change in the requirement specification chartered out by M/ s. Bajaj Auto Ltd. The first proto type on module viz. store, purchase, despatch, marketing, replacement, export production, plan on 23rd January, 1993. As per order letter the opposite party completed strategic planning for information technology (SPIT) on 8.1.93 and report was submitted. Based on the report Autolite had released replacement, as per the proposal, for the completion of SPIT exercise. Meanwhile the opposite party had also taken up the training activity of training people of both Anushikha and Autolite, on computer awareness, for which Autolite released Rs. 20,000/-. Rs. 10,000/- was pending towards IAN training which was not completed. The final softwares on stores, purchase, marketing, despatch, export production plan was demonstrated in May on 15th-16th and user acceptance taken. Autolite had paid 1.1. (L) towards system requirement specification study. It is stated that Autolite, after the acceptance of the modules, did not pay up for the same. The billing schedule is mentioned in the order letter. Inspite of several reminders, Autolite did not pay the balance of Rs. 1.5 (L) as per contract. Hence the opposite party dropped developing further modules from June, 1993 onwards. On specific assurance that the outstanding would be cleared, opposite party had developed the personal information and maintenance system, which was also accepted by Mr. Sogani. Softare developed could not be implemented due to lack of availability by LAN hardwares and software was developed for LAN hardware. The LAN hardware was installed only on 4.1.94. It is stated that requirements started changing from time to time due to change in the personal at Autolite as also change in the requirement, specification due to a delay in implementing the above. Revisions kept on coming till 2nd April, 1994 which were mostly accommodated even though they were beyond the scope of the project.

WITH regard to the letters of the complainant dated 2.11.93 and the letter of the opposite party dated 13.12.93 (Annexures 6 and 7), it is stated that the opposite party were willing to make discrepancies slash modification if any from the user requirement provided to them. The discrepancy report should have reached to the opposite party latest by December, 1993 failing which it would be assumed that the software on maintenance, personal information system, central stores module and purchase module are acceptable. It was also pointed out that the export module provided to Autolite was acceptable to them in the absence of the discrepancy report in the above. The claim of the complainant and the reliefs claimed by it are denied. It is stated that because of the conduct of the complainant, the opposite party have been put to loss. It was the opposite party who did not receive even their due amount from the complainant. The opposite party have always worked to the highest reputation which they have earned all over. WITH regard to payments, it is said that no advance payment had been made to the opposite party, but rather they were paid for the work which had been done by them. The opposite party has also pleaded that the nature of contract would indicate that complainant does not fall within the definition of "consumer" and hence the complaint is not maintainable. It may be mentioned that the complainant has filed certain photocopies of documents and affidavit of M.D. Sharma, Chief General Manager in M/s. Autolite (India) Ltd. Counsel for the opposite party Sushree Manju Devi stated on 4.8.95 that the opposite party does not want to file any other documents or affidavit. This complaint case was listed for arguments before the State Commission on 19.1.96. Counsels for the parties sought adjournment for arguments and on their request the complaint case was adjourned for arguments to 17.5.96. On 17.5.96, the Counsel for the complainant Mr. Hemant Singh, Advocate appeared but none appeared for the opposite party despite notice of the date. We have, therefore, heard the learned Counsel for the complainant and have gone through the record.

IT appears from the letter of the opposite party dated 25.9.92 (Annexure-1) that Mr. Mandeep Sawhney, Senior Marketing Executive of opposite party-Apple Industries Ltd., had discussions with Mr. M.D. Sharma of the complainant-Company with regard to implementation of computers and also manpower development in the complainant-Company''s organisation. Mr. Mandeep Sawhney, with reference to these discussions, had sent to the complainant a brief write-up on strategic planning for information system (SPIS) and a brief write up on the financial implications of the project as also an outline of the deliverables which would keep the complainant to act on opposite party''s proposal. IT was informed to the complainant that in case of any further clarification the complainant can write to the opposite party. Some of the important proposals contained in strategic planning for Information System (SPIS) were as follows: 1. Apple Industries Ltd. (AIL) would carry out the following: (a) Strategic planning for information technology of Autolite (India) Ltd. (b) Software development for the applications in the following areas of Autolite (India) Ltd: (i) Sales & Marketing; (ii) Production planning; (iii) Maintenance; (iv) Quality Assurance; (v) Accounts and costing; (vi) Finance and Company Secretary; (vii) Projects, (viii) Stores or despatch; (ix) Purchases; (x) Exports; and (xi) Personnel. The software will be developed, tested and implemented based on the system study and acceptance by the user. The main features of the software will include availability of right information at the right time. No discrepancies. Note - IT does not cover any hardware costs. The (SPIS) also contained training programmes as contained under the head "Software Development". Training programme was to acquaint the user with the change in the way post-computerisation, reassure users un- familiarity and outline the benefits from computerisation, a training programme on basic concepts of computer would be undertaken. (2) Systems Analysis and Design: The consultants from AIL-BAL would study the complete existing system to understand the finer aspects and users information requirements. A prototype would be developed for input and output screens and submitted to Autolite for user acceptance. Based on the approval of the total system, modules will be developed and implemented. The deliverables in this step are Data Flow Diagrams, Input Screens, Files and External Interfaces. (3) Software Development: Based on the system study the applications to be developed by user will be identified. The user would be training to develop applications on their own. The applications which are to be developed by AIL- BAL will be developed in modules: Module 1 - Production, maintenance and quality. Module 2 - Sales & marketing and purchase& stores. Module 3 - Accounts, Costing, Finance and Company Secretary. Module 4 - Exports and Projects. (4) Implementation: Each module would be installed, tested for various conditions and user acceptance. The module will be integrated and system integration tests would he carried out. All care would be taken to provide error free software by assuring quality at every stage of development. (5) Training: The user from concerned department will be trained in the application of package. (6) Documentation: Two types of documents would be provided to clients. User Manual: This would contain all menu features and would be indexed. This would be very easy to use and understand. System and Operation manual: This would cover maintenance aspects like back up, roll back and error handling features. The source code will also be given in this manual for all programmes. As to time frame, it was provided that after receipt of contract and advance, total duration in calender weeks = 28 weeks (7 months) for complete installation, user acceptance. This period was from 1st week of November, 1992 to complete it by May, 1993. Financial Implications: (a) Strategy: Planning for information systems- : Rs. 2.0 lakhs Top management workshop system Analysis and Design. (b) Software - Prototype, coding and implementation of modules. : Rs. 4.5 lakhs (c) Training of top management, middle management and operator : Rs. 1.8 lakhs. Billing Schedule 1. Advance alongwith the order - Rs, 50.000/-(November) 2. At the end of first month - Rs. 50,000 /-(December) 3. At the end of second month - Rs.1,00,000/-(January) 4. At the end of third month - Rs.1,00,000/-(February) 5. At the end of the fourth month - Rs.1,00,000/-(March) 6. At the end of fifth month - Rs.1,00,000/-(April) 7. At the end of sixth month - Rs.1,25,000/-(May) 8. After completion of project - Rs. 1,25,000/-(May) Rest.

Autolite (India) Ltd. by its letter dated (Annexure- 3) placed the order on Apple Industries Limited under following terms and conditions:- A. Strategic Planning for information technology of Autolite (India) Limited. B. Software - Development for the application in the following area: (1) Sale & Marketing (2) Production- Production Planning (3) Maintenance (4) Quality Assurance (5) Accounts & Costing (6) Finance & Secretarial (7) Project (8) Stores (9) Despatch (10) Purchase (11) Exports (12) Personnel C. Payment terms Total value of the order would be Rs. 7.50 lakhs in the following billing schedule. This includes strategic Planning, Software Development, Training and implementation. 1. Advance alongwith the order : Rs. 50,000/- 2. At the end for First month : Rs. 50,000/- 3. At the end of Second month : Rs. 50,000/- 4. At the end of third month : Rs. l.00,000/- 5. At the end of fourth month : Rs. 1,00,000/- 6. At the end of Fifth month : Rs. 1.00,000/- 7. At the end of sixth month : Rs. 1,00,000/- 8. After completion of project : Rs. 2,00,000/- N.L. Gupta, General Manager (Q) of the complainant sent a letter dated 23.3.93 (Annexure- 4) to the opposite party wherein he mentioned that various formats to be used by different departments were handed over to the representative of AIL during March, 1993. This consisted nearly 85% of the formats. The remaining 15% formats were mentioned to be sent to AIL shortly. It was lastly mentioned that the other documents i.e., quality policy manual. Departmental Procedural Manuals and various work Informations which are of proprietory nature cannot be sent outside factory. Therefore, AIL personnel should be deputed to Autolite for computerisation of these proprietory documents. Version of the opposite party in this regard is that other documents referred to by the complainant had nothing to do with the present contract as it was a separate contract issued by the complainant vide letter dated 13.3.93.

TO us the version of the opposite party is correct that the letter of the Autolite dated 13.4.93 (jointly marked Annexure-4) related to another contract. The very heading of this letter dated 13.4.93 mentions the subject as "Contract for rendering consultancy services for accreditation under ISS 9002 quality system standards". This was with reference to the offer made by AIL for rendering consultancy by their letter dated 26.3.93. The contract awarded by the complainant-Company to AIL by letter dated 13.4.93 is quite a separate and independent contract and anything to be done under this independent contract cannot be allowed to be mixed with contract made on 28.10.92 by Annexure-3.

INSTALLATION of hardware was not the responsibility of the opposite party. Complainant-Company informed the consultant B. Ragupathy that the installation of computers is expected to be completed before 15.11.93. So he would like to call his software experts in the 3rd or 4th week of November, 1993. By this inter- office memo B. Raghupathy, consultant gave tentative programme to Mr. Sanjeev Sogani, System Analyst. Thereafter, the Autolite in its letter dated 2.11.93 added certain more areas for which software to be developed for application. Mr. Sanjeev Sogani, System Analyst said in letter dated 2.11.93 that after going through your system study report, we have found that following departments work was totally missed out: (a) Gate office, (b) Share accounting, (c) Central Lab. (d) Maintenance (e) Packing department (f) Quality system.

In this letter reference was also made to Autolite''s requirement which had been given. It also appears that Mr. Raghupathy had asked the complainant to buy three more terminals. In that respect, Sogani put forward his views. A list of operational level training for LAN of 18 persons was given.

Ail Executive Shawney sent a letter dated 13.12.93 (Annexure-7) to the complainant wherein he inter alia mentioned: "We are pleased to inform that during this visit we have installed the following software on your machine: (1) Maintenance module (2) Personnel Information System (3) Central stores module (4) Purchase module (5) Marketing module (6) Despatch module (7) Production module All the modules have been (except v, vi, and vii) demonstrated to the concerned users and the System Analyst Mr. Sogani. Modules (v), (vi) and (vii) have been explained to Mr. Sanjeev Sogani and he would be able to help the users in (i), (ii) and (iii) above. There is a small setting problem in the software provided by Bajaj which Mr. Jain would rectify by giving instructions to Mr. Sogani over the phone on 17.12.93. The letter further mentioned that during the course of installation and testing of the above mentioned software modules, some modifications were suggested by some of the users. N. Dhakmankaj wrote in the letter that "We shall book into the possibility of the same and shall modify the software if possible within the normal constraints. However, discrepancies if any from the user requirements provided to us shall definitely be corrected. The letter further stated that as agreed by Mr. Sogani we shall be expecting your discrepancy/modification report before the end of this month after the detailed analysis of the software. In the event, no such letter is received by us, we shall presume that the softwares (i), (ii), (iii) and (iv) are acceptable to you and would be glad to get an acceptance letter from you on the same. Also a complete report Documentation Module was provided to you during Mr. Jain''s last visit. We have not received any discrepancy report on the above. We assume that the software is accepted and would like to have your acceptance to it."

MR. M.D. Sharma, General Manager of the complainant sent a letter dated 20th December, 1993 to the opposite party in which he stated that the software work was being handled by the opposite party very poorly. Out of about seven softwares, five softwares were not in working condition. They cannot therefore be called as installed. The remaining two softwares (1) Pay Roll and (2) maintenance are technically of very, very poor quality and they do not cover the work efficiently and completely. It was mentioned m the letter that a detailed list of all discrepancies will be sent to the opposite party for each software (i.e., Pay Roll and maintenance) as soon as evaluation was over for the same. Thereafter by letter dated 12.2.94 (Annexure-9) to the General Manager of opposite party that they had drawn a status chart pertaining to complete software work, which was being enclosed. It was mentioned that as per the status, practically no software was completed by the opposite party, resulting into failure of their entire computerisation plans. Photocopy of the status of the software development as on 22.2.94 by the complainant-Company is so faint that one cannot make any head or tail by it. We strongly deprecate the tendency amongst the parties to file faint copies of documents. We insist that either original or office copies of the documents should be produced instead of photocopies which by themselves are neither primary evidence and nor, without proof, secondary evidence. There is yet another letter dated 27.1.94 of Autolite to AIL dated 27.1.94 (Annexure-9) in which it was mentioned that Pay Roll software had been found of a very, very bad quality. Complaint was also made regarding date pertaining to maintenance system. The software made for store/purchase/production/despatch, marketing etc. was also not functioning at all.

BY letter dated 21.2.94, the opposite party sent to the complainant the review of project status, action plan for implementation, plan for development of pending modules. Salient features of this review of project status may be extracted. Sl. No. Activities Responsible Date completed. Ramarks 1. Requirement analysis BAL/AIL 17.11.92 to 2.11.92 2. Submission of required analysis report and asking for feedback. BAL/AIL 6.12.92 Since no feedbacks were reed. from Autolite requirements are freezed 3. Demo of prototype of modules (a) Stores (b) Purchase (c) Despatch (d) Marketing -OE -Replacement -Export -Production Plan BAL/AIL 1st week Feb., 93 Suggested Modifications were noted. 4. Complete software modules stores, purchase, despatch, marketing (OE, Replace, Export) production plain BAL/AIL May 10th to 17th Software was accepted by all departments (minor modifications were suggested by exporter and purchaser 5. Implementation of software developed. Autolite/ AIL (Acceptance letter enclosed) could not be undertaken due to non-availability of hardware in May, 93 6. Completed software modules of personnel and maintenance. AIL 8.12.93 Acceptance of software by Sogani enclosed. 7. Installation of hardware and netware. AIL 7.12.93 Problems in netware configuration. 8. Configuration problem rectified. Autolite 4.2.94 9. Software modules installed on hardware, despatch, stores, purchase, personnel maintenance, production, plan, marketing. AIL 5.2.94 User informed to enter data in these softwares 10. Implementation in terms of data entry in these modules. Autolite 11. Visit of BAL to modify changes suggested by users of the software developed BAL 14.2.94 to 21.2.94 Modifications which have been suggested during this period 14.2.94 to 21.2.94 whatever was feasible has been completed (User acceptance awaited). 12. User acceptance of the above modules. Autolite Awaited. Delay in Project Execution is because of the following activities : Activity targeted Actual (a) Delay in installing H/W and N/W. April-May, 93 Feb. 4,1994 (b) User changing the requirement after acceptance in Feb., May, Dec., May, 93 May, 93 Feb. 94 (c) Implementation of above modules. May, 1993 Would depend on user involvement Action Plan for implementation for the Modules delivered to the complainant. Sl. No. Activities Responsible Date to be completed Remarks 1. Acceptance of the modules delivered to Autolite. Autolite 7.3.94 Autolite do make people available Apple Ind. to provide faculty. 2. Trg. to users on the modules stores, Purchase, Despatch, Personnel, Maintenance, Production, Marketing, Export, Replacement). Autolite/ AIL 3. Data entry to create master testing of results. Autolite 20.3.94 4. Software pilly in operation. Autolite 1.4.94 Action Plan for Development of Pending Software Modules Activities Responsible Date to be completed Remarks 1. User requirement with respect to Finance, Stores, Accounting, Projects duly signed by Competent Authority. Autolite 25.2.94 No change would be accepted in future. 2. Development of software based on the above requirement. Apple/BAL 23.5.94 3. Data entry on the modules for implementation and creation of master. Autolite 10.6.94 4. Debegging of errors in logic. Apple Ind./ BAL 20.6.94 5. The software in Autolite total operation. Any delay in activity (1) will delay the project. Payment Plan (Which are linked to implementation) Value of the order Already paid On acceptance of modules Delivered: (a) Stores (b) Purchase (c) Despatch (d) Production Plan (e) Maintenance (f) Personnel. On completion of these modules in terms of data entry and report of generation. On acceptance of software, Development of Accounts, Stores, Finance and Training in HT PM software for Project. On implementation of above module. Delivery of documentation source. 1.7.94 : 7.5 L : 4.0 L 2.01 L 0.25 L 0.75 L 0.25 L 0.25 L After this review status, there is letter of complainant dated 30.3.94 addressed to the General Manager of the opposite party stating that "Your Dr. Regional Manager had promised us that Mr. Dharamraj will remain with us until implementation process is over which was also as per the contract, but he was with the complainant only for the 1st week of March and then he had left for Delhi and has not returned. It was stated that the complainant have faced many problems and in non-availability of opposite party''s person, the implementation plans have terribly suffered. No user manual is supplied to the complainant, no source code is supplied, no system report is supplied and still no work is done by you on many other packages. Then the complainant sent a notice to the opposite party on 18.6.94. In this notice, the complaint mentioned the factual position with regard to PT. B of work contract as under: S. No. Software description Software given Work completed Work status 1. Sales & Marketing Yes No Tried to implement but could not do so due to defects in software. 2. Production & Production Planning. Partial No 3. Maintenance No No 4. Quality Assurance No No 5. Accounts & Costing No No 6. Finance & Secretarial No No 7. Project No No 8. Stores Yes No Tried to implement but could not do so due to defects in software. 9. Despatch Yes -do- 10. Purchase Yes -do- 11. Exports Yes No -do- 12. Personal Yes No Implementable 13. Gate office No No - 14. Documentation No No - To this notice, the opposite party sent a reply dated 30.6.94 (Annexure-13) wherein it clarified the following: 1. Actions have already been taken to complete the software already delivered to the complainant to the satisfaction of the complainant. 2. The consultant would reach Autolite on 30.6.94 to hand over software as agreed with Autolite. 3. As per order letter para 13 items 13 and 14, this is not a part of the contract. Hence, it would be out of scope. 4. We would undertake to develop other softwares apart from what we have delivered on payment due to us on completion of above softwares which associate to Rs. 1.5 L 5. The amount paid to us is of Rs. 4.0 (L) is on the basis of the completion of following activities as per our proposal: (1) Strategic planning for information technology. Rs. 2.0 (L) (2) Tranining of employees. Rs. 0.90 (L) (3) System study for software Rs. 0.60 (L) (4) Part payment towards software development Rs. 0.60 (L) for the software developed.

LAST was complainant''s Advocate''s notice, before filing, the complaint. The notice is dated 6.10.94. In this notice also the Advocate reproduced a status chart of software work done by the opposite party, work which was not done and regarding implementation status. As regards payment of the complainant''s dues, it was mentioned in the notice that the complainant had no objection to make payments immediately on completion of all the jobs. That is the documentary evidence adduced by the complainant Company.

AS already stated, the Counsel for the opposite party stated before the State Commission on 11.9.95 that the opposite party does not want to file any other documents or affidavits. AS a matter of fact, the opposite party has only filed version. Opposite party did not file any affidavit or documents in rebuttal. It appears from the averments made in para 2 of the Additional pleas of the version that the opposite party was doing this job in collaboration or co-operation with M/s. Bajaj Auto Ltd. According to the opposite party, the first proto- type on module viz. store, purchase, despatch, marketing, replacement, export, production plan was delivered on 23.1.93 and final softwares of the above were demonstrated on May 15th -16th and user acceptance taken. No such user''s acceptance has been produced by the opposite party. On the other hand, from the Review of Progress of software development sent by the opposite party itself to the complainant, there is mention in the remarks column that suggested modifications were noted. Again, against entry No. 4, it is mentioned that minor modifications were suggested by expert and purchase departments. Had some work not remained outstanding the opposite party would not have drawn the Action Plan for implementation in February, 1994 which it sent to the complainant by its letter dated 21.2.94. It was mentioned at the end of the letter dated 21.2.94 by the Dy. Regional Manager AIL that "We are committed to effective implementation of software. Action plan for development of pending software modules was also given and they covered user requirement with respect to finance, shares. Accounting, Projects, Training to users on the modules stores, purchase. Despatch, Personnel, Maintenance etc. was also agreed to be given on 7.3.94. The complainant was to make people available and the opposite party was to provide facility. It was also mentioned that debegging of any processing errors in the software will be done on receipt of errors by 20.3.94. It is mentioned in the review that modifications which had been suggested during the period 14.2.94 to 21.2.94, whatever was feasible has been completed. However, user''s acceptance of the modules in question had not been obtained and was awaited.

It may also be noted that in letter dated 13.12.93 (Annexure-7) sent by the opposite party, it was mentioned by Dharmraj, Senior Training Executive of the opposite party that modifications had been suggested by some of the departments of the complainant and it was assured that the opposite party will look into the feasibility of the same and shall modify the software. It was also assured that the discrepancies if any, from the user''s management received by the opposite party shall definitely be corrected. It is thus clear that it had been agreed and assured that modifications would be carried out and discrepancies in the modules would be corrected. It is also clear that the opposite party has not delivered to the complainant user manual, operational manual, system report and source code probably because this was to be done in the last on receipt of balance instalment of payment from the complainant.

WE may analyse the status chart given by the complainant''s Advocate in latest letter dated 6.10.94. From this status chart, it would appear that software relating to Sales & Marketing, Production and Production Planning, Stores, Purchases, Despatches, Exports and Shipping and Personnel had been delivered to the complainant-Company. However, it is said that they cannot be implemented without source code, systems reports, operational manual, users manual and rectification of discrepancies. Then it is mentioned that software relating to maintenance, Gate office. Documentation, Project, Finance and Secretarial, Accounts and Costing and Quality assurance have not been given to the complainant. Lastly, it is said that the opposite party has also not imparted training completely as per the contract. As already mentioned above, under the order placed by the Autolite by its letter dated 24.8.92 to the opposite party software development for the application in the areas of, (1) Sale & marketing, (2) Production, Production Planning, (3) Maintenance, (4) Quality Assurance, (5) Accounts & Costing, (6) Finance and Secretarial, (7) Projects, (8) Stores, (9) Despatch, (10) Purchase, (11) Exports, and (12) Personnels were to be supplied. It appears from the letter of the opposite party dated 13.12.93 (Annexure-7 that by this letter it informed the complainant that, (1) Maintenance module, (2) Personnel Information System, (3) Central Stores module, (4) Purchase Module, (5) Marketing module, (6) Despatch module, and (7) Projects module had been supplied. These modules (except (5), (6) and (7) above) had been demonstrated to the concerned users and the System Analyst Mr. Sanjeev Sogani and he would be able to help the users in (1), (2) and (3) above. There was a small setting problem in the software provided by Bajaj which Mr. Jain would rectify by giving instruction to Mr. Sogani over the telephone on 17.12.93. During the course of installation and testing of the above mentioned software modules, some modifications were suggested by some of the users. It was stated that the opposite party would look into the feasibility of the same and shall modify the software if possible within the normal constraints. However, discrepancies, if any, from the user departments provided to us, shall definitely be corrected. The opposite party expected to get discrepancy/modification report before the end of the month of December, 1993 after the detailed analysis of the software. In the event no such letter was received by the opposite-party, it was to be assumed that the software (1), (2), (3) and (4) are acceptable to the complainant and the opposite party would be glad to get an acceptance letter from the complainant. Lastly, it was mentioned that also a complete report documentation module was provided to the complainant during Mr. Jain''s visit and the opposite had not received any discrepancy report on the above and it was assumed that the software was accepted.

THE complainant-Company admitted the delivery of seven modules by its letter dated 30.12.93 (Annexure-8) but the complainant mentioned that out of the seven softwares, five softwares are not in working condition with regard to pay roll and maintenance module, it was informed that they were of very poor quality and were full of discrepancies. It may here be mentioned that the present complaint was filed by the complainant- Company in this State Commission on 3.12.94. With regard to the softwares, complainant''s grievances are contained in the registered letters/ notices sent by the complainant''s Advocate to the opposite party on 18.6.94 and 6.10.94. It would appear from the factual position and the status chart contained in those notices that it is not in controversy that the complainant-Company had been delivered software on, (1) Sales & Marketing, (2) Production and Production Planning, (3) Stores, (4) Purchases, (5) Despatches, (6) Exports & Shipping, and (7) Personnel. In these notices, it was mentioned that softwares on, (1) Maintenance (2) Gate office (3) Documentation, (4) Project, (5) Finance & Secretarial, (6) Accounts and Costing and Quality Assurance had not been delivered by the opposite party. With regard to the softwares delivery, it is stated that they cannot be implemented without source code, systems reports, operation manual, user''s manual and rectification of discrepancies. The opposite party in its letter dated 30.6.94 (Annexure-13) had replied to the complainant''s Advocate that action has already been taken to complete the software already delivered to the complainant to the satisfaction of the complainant. It was further written that consultants would reach Autolite on 30.6.94 to hand over software as agreed with Autolite. It would appear from Annexure-7 sent by opposite party to the complainant and the review of project status enclosed thereto that there was some setting problems in the software provided by Bajaj which were to be rectified, some modifications were to be made and discrepancies removed. As against Serial Nos. 3 and 4 of the review status, in the remarks column, it was mentioned "Suggested modifications noted" and that "software was accepted (minor modifications were suggested by export and purchase)." It was further mentioned that implementation of software developed could not be undertaken due to non availability of hardware in May, 1993. It also appears from the Review Status that the opposite party had not received user''s acceptance of the modifications alleged to have been made by B.A.L. and was awaited. It also appears from the action plan for implementation that training to user''s on the modules had not been given. It was mentioned in the action plan for implementation that Autolite was to make people available to AIL to provide faculty. Debogging of any processing errors in the software was to be made by Bajaj on receipt of errors.

SO far as the payment aspect is concerned, the payment schedule was as under:

TOTAL value of the order was 7.50 lacs. This included strategic planning, software development, training and implementation. An amount of Rs. 50,000/- was to be paid as advance with the order. Rest of the amount was to be paid as follows: (1) At the end of first month : Rs. 50,000/- (2) At the end of second month : Rs. 50,000/- (3) At the end of third month : Rs. 1,00,000/- (4) At the end of fourth month : Rs. 1,00,000/- (5) At the end of fifth month : Rs. 1,00,000/- (6) At the end of sixth month : Rs. 1,00,000/- (7) After completion of project : Rs. 2,00,000/- The complainant-Company has already paid to the opposite party a total amount of Rs. 4.00 lakhs i.e., complete payment which was required to be paid upto the end of fourth month and Rs. 50,000/- towards the payment which had to be made at the end of the fifth month (April, 1993). Financial implications worked out in strategic Planning Report were as under: 1. Strategy planning for information system. - Rs. 2.00 lakhs 2. Software Prototype coding and implementation of modules. - Rs. 4.5 lakhs 3. Training of top management and operator. - Rs. 1.00 lakh

It would thus appear that the complainant-Company has paid the entire amount of Rs. 2. lakhs which was chargeable for strategy planning for information system as this work had been completed by the opposite party before the end of September, 1992. As against software, payment of Rs. 2 lakhs stand paid. Balance of Rs. 2.5 lakhs towards software has not been paid. Nothing has been paid as against training item. It is also to be noted that as per payment schedule Rs. 2 lakhs had to be paid after completion of project.

UPON examination and consideration of above facts, we came to the conclusion that following work in the project remains to be done by the opposite party: (1) Carrying out modifications suggested and removal of discrepancies in the modules already delivered to the complainant-Company. (2) Development of software with respect to Finance & Secretarial, Accounts & Costing, Projects, Shares. (3) Implementation of software. (4) Completion of training to users on the modules. (5) Delivery to the complainant of user''s manual, operational manual, system reports and source code.

In failing to carry out the above works the opposite party has committed deficiency in service. The opposite party did not carry out the modifications suggested in the modules. They did not develop and deliver modules with respect to Finance & Secretarial, Accounts & Costing, Projects, Shares. Softwares were not implemented and complete training was not given to the users. Documents referred to at Item No. 5 (above) were not delivered. Alleged user''s acceptance has not been produced. The project was to be completed by the end of the month of May, 1993. Present complaint was filed on 3.12.94. As to the reliefs which should be granted to the complainant, we are of the view that the opposite party should be directed to remove the deficiencies within a fixed time schedule. The opposite party should also be directed to supply user''s manual, operational manual, system reports and source code by a specified time. As to monetary compensation, it may be stated that the complainant has not established by evidence as to what business loss and loss of foreign exchange it suffered on account of non-completion of the computerisation project. All that can be said is that due to non-completion of the project and delay in its completion, the complainant could not improve the efficiency in its organisation through the computer-feeded programmes and could not enhance its management and economic potentiality. It is clear that so far as strategic planning for information technology implementation and training was concerned, this strategy work had been duly completed by the opposite party and for that the opposite party was entitled to get Rs. 2 lakhs. Upon the remaining amount of Rs. 2 lakhs, which the complainant-Company has paid towards softwares and implementation of modules and which work has only been partially done, the complainant-Company is entitled to get interest @ 18% per annum from the opposite party by way of compensation with effect from 1st June, 1993 till the latter completes the project as per the time-schedule. The complainant-Company is also entitled to get Rs. 2,000/- as costs from the opposite party.

WE, therefore, partly allow this complaint and order the opposite party to rectify softwares already supplied and to remove the deficiency within the following time - schedule: Sl. No. Activities Date by which to be completed. 1. Making of already suggested modifications and removal of already suggested discrepancies in the modules delivered. Two months from the receipt of this order 2. Development of software with respect of Finance & Secretarial shares Accounts, costing and Projects. Note : No further change in them from the side of the complainant will be-accepted. Within 3 months from the date of receipt of this order. 3. Implementation of software. Within four months from the date of receipt of this order. 4. Completion of training to users on the modules. Within four months from the date of receipt of this order. 5. Delivery to the complainant of users manual, operational manual, system reports and source code. Within two months from the date of receipt of this order. The complainant-Company will pay to the opposite party Rs. 2 lakhs on completion of Activities Nos. 1,2 and 5 (supra). Complainant will pay to the opposite party the balance amount of Rs. 1.5 lakhs upon completion of Activities Nos. 3 and 4 (supra). The opposite party will pay to the complainant-Company interest by way of compensation @ 18% per annum on the amount of Rs. 2 lakhs with effect from 1st June, 1993 till the opposite parties complete the project activities specified at items 1 to 5 (supra). Complainant will further get Rs. 2,000/- as costs of this complaint from the opposite party. Rest of the claim is disallowed. Complaint partly allowed with costs.