HCL LIMITED vs REJIK.VARGHESE

OPPOSITE party in O.P. 92/95 on the file of the Consumer Disputes Redressal Forum, Thiruvananthapuram is the appellant. Complainant alleged before the District Forum that as per the agreement between the complainant and the opposite party, the opposite party installed EPABX system in the hotel and Exbt. Al agreement was executed regarding the terms and conditions of the installation. It was alleged that the delay in installation of the system caused loss to the complainant. Apart from the same the system was not working properly, though request was made by sending letters to the opposite party for rectifying the defect, they did not attend the same. They took the equipment for repair with the promise to replace the same, but that also they did not comply. On 22.8.1992 the defect which occurred subsequently was intimated by issuing notice to the opposite party without any response. Recurring fault affected loss to the complainant. Inspite of that the opposite party did not attend or rectify the defect insisting that the complainant should sign maintenance contract towards which the opposite party demanded payment. The system later stopped functioning from 9.4.1994. Therefore, the complainant wanted replacement of the said system with a new EPABX system and for a compensation of Rs. 5,00,000/-. In the version filed by the opposite parties they contended that the complaint is not maintainable, the complainant is not a consumer, the EPABX system was procured by the complainant on a hire purchase basis and that too for commercial purpose, and, therefore, the complaint as such is not entertainable before the FORA. Whenever defect was intimated the opposite party attended the same, the complainant had agreed to pay the opposite party an advance of Rs. 60,000/- and to pay rental at the rate of Rs. 23,425/- for 36 months. The price was credited to HCL as a loan extended to the complainant. The same was communicated to the complainant as per Exbt. Dl, the complainant accepted the proposal and issued Exbt. D2. There was a subsequent modification in the agreement as regards the instalments to be paid and the quantum thereof. It is in accordance with said agreement that equipment was installed on 20.8.1991 The complainant is a defaulter; amounts are due from the complainant. They denied the allegation of recurring default, it at all there is any defect that was due to the improper handling of the system The defects whenever reported were attended properly which would be revealed from the customer call-cum-service slips. As per the report of the complainant the opposite party attended the repair Exbt. D3 is the call report on the same date which was countersigned by the representative of the complainant. The complainant erased the files stored in it relating to calls recorded in TCMS. Exbt. D3 call report would also show that the equipment does not suffer from defect as claimed. They asserted that the complaint is not maintainable and, therefore, the same is liable to be dismissed. Complainant produced Exbis. P1 to P25, and gave evidence as P.W. 1. On behalf of the opposite party D.W. 1 was examined and Exbts. Dl to D8 were produced. On a consideration of the said material the District Forum directed the opposite party to replace the defective EPABX system with a new one within one month and directed the parties to bear their costs. It is the said direction that is under challenge in this appeal.

IT was urged by the learned Counsel for the appellant that the District Forum has gone wrong in holding that the complaint is maintainable. According to the learned Counsel the complaint is not properly instituted as the complainant is not competent to maintain the complaint on behalf of the Kanichai Hotels Private Limited which is the proprietor of Hotel Lucia Continental. The District Forum itself had no jurisdiction to entertain the complaint because the subject matter of the complaint is beyond the pecuniary jurisdiction of the District Forum. The learned Counsel then argued, since the purchase of the equipment was for commercial purpose, the complainant is not a consumer and maintained alternatively, even if the complaint is maintainable there is nothing acceptable to show that the equipment suffered from any defect-manufacturing defect, so as to qualify the complainant for a relief of replacement of the equipment with a new one. Apart from the same, it is pointed out by the learned Counsel, the service-cum-call reports Exbt. D3 series submitted on behalf of the opposite parties would show that as a matter of fact the machinery does not suffer from any defect. Therefore, the learned Counsel wanted reversal of the order of the District Forum. On the other hand the learned Counsel for the respondent supported that order of the District Forum urging the the complainant had produced Exbts. P24 and P25, which would show that the complainant is authorised to institute the complaint and as regard the contention that since the purchase was for commercial purpose the complainant cannot be a consumer, the learned Counsel submitted that the said argument cannot hold good as even according to the opposite party the equipment was purchased by the complainants on a hire purchase agreement. Apart from the same the defect since arose during warranty period though it continues; it is urged in relation to the service under the warranty the complainant is a consumer even if the purchase was for commercial purpose. As regards the argument of the learned Counsel for the appellant that the District Forum had no jurisdiction to entertain the complaint as the value of the subject matter is beyond its cognizance, it is submitted that there is no such defence by the opposite party, therefore, he cannot argue as regards lack of jurisdiction at this stage. With respect to the defects in the machine, the learned Counsel pointed out that the evidence produced on behalf of the complainant would demonstrate that recurring of the defects to the equipment were so numerous that the same by themselves would demonstrate that the equipment suffered from manufacturing defect. It is pointed out by the learned Counsel that the machine completely failed on 9.5.1994 and though intimation was made to the opposite party, it did not care to attend nor even to reply. They took the stand that so long as maintenance agreement is not executed themselves are not obliged to attend the defect. According to the learned Counsel having regard to the aforesaid evidence, the complaint is maintainable, complainant is a consumer and the equipment suffers from defect, which is manufacturing defect and, therefore, the direction made by the District Forum to replace the equipment cannot be called in question at the instance of the appellant.

Having regard to the arguments advanced by the complainant as well as the opposite party, the first question to be adverted is, as to the maintainability of the complaint. It is true, Exbts. Dl and D2 would show that the subject matter is valued at Rs. 6,80,000/-. In the version that is no pleading to the effect that the District Forum has no jurisdiction to entertain the complaint. When the contention is lack of pecuniary jurisdiction as distinct from lack of inherent jurisdiction, the same is curable by submission to jurisdiction. When a defence as to jurisdiction is not taken that would amount submission to jurisdiction. The Appellate Court or a Revisional Court cannot entertain lack of pecuniary jurisdiction for the first time in appeal; as such defence must be taken at the earliest opportunity. The learned Counsel for the respondent relied on the decision in Maimuna Begum v. Lakshman Rabidas, AIR 1992 Gauhati 91. The principle that lack of territorial or pecuniary jurisdiction can be cured by submission to jurisdiction is laid down in the decision reported in Luiz v. Abdul Rahiman, 1986 KLT 970. Since no specific defence as to lack of jurisdiction is taken, the opposite party cannot maintain at the stage of appeal that the District Forum had no jurisdiction to entertain the complaint.

THE learned Counsel for the appellant relied on the decision of the Supreme Court in Laxmi Engineering Works v. P.S.G. Industrial Institute, II (1995) CPJ 1 (SC)=AIR 1995 Supreme Court 1428, in support of his argument that when a person claims to have obtained the goods for earning his livelihood he has to prove that he so purchased it to use the same by himself exclusively for the purpose of earning his livelihood. It is pointed out, even P.W. 1 has admitted that other employees also used to attend the equipment. Having regard to the fact that the purchase was for the purpose of using it in a hotel, applying the aforesaid principle in the context of the said evidence it could be argued that the complainant cannot be a consumer. It is not as such the case of the complainant that he purchased the same for ekking out his livelihood. THE case put forth is, the defect since arose during the warranty period irrespective of the question whether the purchase was for commercial purpose, so far as the service under the warranty is concerned, the complainant is a consumer. Reliance was made by the learned Counsel for the respondent on the decision of the National Commission in Amtrex Ambience Ltd. v. M/s. Alpha Radios & Anr., I (1996) CPJ 324 (NC). THE learned Counsel for the opposite party attempted to meet the said argument by pointing out that warranty expired by 19.2.1993 and the institution of the complaint was long after that and hence the complaint cannot be entertained on the ground that as the defect arose within the warranty period the complaint is maintainable. Apart from the case of the complainant that since the matter concerns service under the warranty, the complainant is a consumer, it was also urged that since the transaction arose under a hire purchase agreement, where the complainant is the hirer, himself should be treated as a consumer in relation to the opposite party. Before going into the question whether the complainant could claim that the complaint is maintainable because the same concerns the service under the warranty that is sought to be enforced; in the circumstance it would be convenient first to deal with the question whether the complainant would be a consumer because the matter arises in a hire purchase transaction.

THE very version of the opposite party would show that it is the case of the opposite party that the EPABX system was procured from the opposite party on hire purchase basis; in para 2 of the version the said contention is raised. Apart from the same, Exbts. Dl and D2 also would support the conclusion that it was a hire purchase transaction. In such circumstance the principle laid down in the decision in President, Kriya Yoga Foundation Trust & Anr. v. Team Finance Company & Anr., II (1991) CPJ 590, by the Orissu State Consumer Disputes Redressal Commission, Cuttack would be applicable. Alternatively, it could be seen that the complainant started to report to the opposite party as to the defect as early as 22nd August, 1992, Exbt. P5 letter mentions that because of the defective functioning the complainant is incurring heavy loss. THE same is followed by Exbt. P6 letter dated 14.10.1992 in which again the defect is pointed out. Exbts. P6, F7, P9, p11 and P12 are letters complaining that the equipment is not functioning properly THEse are all before 19.2.1993. It is pertinent in this connection to note Exbt. P10. THE same is a reply sent by the opposite party to the complainant and is dated 11.2.1993. In para 3 of the said letter though they say that there is no problem for the computer and the software part of the computer is to be looked into, the opposite party reminds the complainant for the loss suffered by the complainant has been deducted from the rental amount; the letter shows that three instalments of rent were deducted towards that and promises that they would speed up the matter and would give a permanent solution. This fortifies a conclusion that before the expiry of the warranty period equipment suffered from defect and even the opposite party did agree to reimburse the loss suffered by the complainant on account of defect ;deducting three instalments of rent. But this is sought to be answered by the learned Counsel for the opposite party relying on Exbt. D3 dated 23.2.1993. The answer attempted is that the defect has been cured on 23.2.1993. In Exbt. D3 what is stated is that the working of the system is satisfactory, but it also mentions the defects found in the system, the officer of the opposite party is seen to have affixed his signature. The question whether the defect which occurred before 19.2.1993 was cured by 23.2.1993 and whether still the equipment continues to be defective can be adverted to when the question of manufacturing defect is considered. All that to be mentioned in this context is, the defects arose during the warranty period had continued recurringly; and if the defect still persists, even though the warranty period has expired since the defect originated during warranty period and the same could not be successfully cured, it cannot be maintained that the complainant is not a consumer as the warranty period has expired.

NOW coming to the question whether the equipment suffers from such defect as to enable the complainant to get it replaced it has to be noted, if the equipment suffers from such defect as to be replaced the opposite party cannot insist performance by the complainant of his obligation under the agreement till the replacement takes place.

IT is true, there is no report by the expert Commission as to the nature of the defect of the equipment. But as has already noted, Exbt. P10 is eloquent enough to show that the equipment suffered from defect. Apart from relying on Exbts. P5 to P7, P9, P10 and P11 reliance was made on Exbts. P12 and P13 alongwith Exbts. P18 to P22 to support the argument of the respondent that the equipment inspite of the attempted repair of 23.2.1993 continues to be defective and ultimately it stopped functioning on 5.4.1994. Exbt. P12 complains that inspite of his request the opposite party''s people have not done any repair after 1993 and that the complainant had sent several letters for redressal of the aforesaid grievance. IT states that till the date of the letter the complainant has suffered a net loss of Rs. 8,00,000/- and that they were forced to purchase a new EPABX system. Then, according to the learned Counsel, they sent Exbt. P13 telegram which intimated that from 9.5.1994 the equipment stopped functioning. D.W. 1 when examined admitted that they have received communication to the effect that the machine became fully dead on 9.5.1994. There is no evidence, they had replied the same or had attempted to verify the same. This particular circumstance has to be appreciated in the context of Exbts. P18 to P22. IT is the case of the complainant that since the equipment failed it became necessary for them to purchase another one and they purchased such an equipment. Exbt. P17 is the quotation. Exbt. P18 is the invoice Exbts. P19 20 21 and 22 are the invoices and bills for the purchase by the complainant. Cumulative effect of the aforesaid evidence is, that inspite of Exbt. D3 repair the complainant made persistent request to attend the equipment because the same continues to be faulty. But all those requests went unheeded and ultimately the complainant had to purchase another equipment. This would show that the equipment supplied by the opposite party suffered from defect and it was having recurring defects and repairs were attempted. In such circumstances the principle laid down in the decision in Urja & Ors. v. Jayshriben Yogeshkumar Desai & Anr., I (1996) CPJ 372, can apply, wherein a TV required repair several times, it is held that the fact that it became necessary to repair the TV several times would itself indicate that there was some manufacturing or inherent defects in the TV set which could not be removed and, therefore, the proper course for the company was to replace the TV set by a new set. The said principle applies in this case also. Thus the complainant is a consumer and the opposite party, in the circumstance, has to replace the system with a new one. Having regard to the aforesaid facts and circumstances, the direction made by the District Forum cannot be said to be infirm so as to call for interference by this Commission. Of course, once the opposite parties replaced the equipment with a new one as per the direction they would be entitled to the return of the one supplied by them and in the custody of the complainant as stated above. The appeal is, therefore, liable to the dismissed.

In the result, the appeal fails and the same is dismissed. Appeal dismissed.