M.O. HASAN KUTHOOS MARICAR P. LTD. vs JOSEPH K.THOMAS

THE Appeal arises out of the Judgment of the District Consumer Disputes Redressal Forum, Madras in O.P. No. 10/90 on its file. THE opposite party before the District Forum is the appellant before us.

THE Complainant-respondent placed an order with the appellant company for a Contessa Classic Car and paid Rs. 2,15,000/- by a pay order drawn on the Union Bank, Chamiers Road, Madras on 3.8.89 on the oral assurance that the vehicle would be delivered within 2 weeks therefore. But the delivery was made only on 10.10.89. He therefore alleges unfair trade practice and deficiency in service and claims interest at 18% per annum on the above sum for a period of six weeks. The appellant opposite party while admitting the receipt of Rs. 2,15,000/- by pay order, has denied that any assurance of delivery within 2 weeks was given. There was no unfair trade practice or deficiency in service. The jurisdiction of the District Forum, Madras and the claim of the respondent as a consumer, the purchase of the vehicle being for a commercial purpose were also disputed.

The District Forum negatived the contentions of the appellant and directed it to pay a sum of Rs. 4,465/- being the interest at 18% on the sum of Rs. 2,15,000/- for six weeks and costs of Rs. 200/-. Hence this appeal.

THE first contention advanced before us by the learned Counsel for the appellant, Mr. T.K. Seshadri is that the booking and delivery were made at Pondicherry and the District Forum at Madras had no territorial jurisdiction. THE receipt for the pay order shows that the pay order has been received at Madras by the Madras Office of the appellant. Under Section 11(2)(c) of the Consumer Protection Act, the District Forum within the local limits of whose jurisdiction the cause of action wholly or in part, arises has jurisdiction. As payment of Rs. 2,15,000/- at Madras is part of the cause of action, the District Forum, Madras had jurisdiction and it has rightly entertained this claim. Again the actual delivery of the car has been made only at Madras as is evident from the fact that a sum of Rs. 300/- has been claimed as transport charges in the final settlement of account found at page 71 of the I typed set of the appellant. It is not denied that this relates to the transport of the vehicle from Pondicherry to Madras. This again is part of the cause of action. This contention has, therefore, to fail. It is then contended by the learned Counsel for the appellant that the allegations of the complainant do not constitute any deficiency in service or any unfair trade practice and the case does not fall within the ambit of the Consumer Protection Act. The appellant is a dealer in Hindustan Contessa Cars manufactured by M/s Hindustan Motors. The appellant books orders for these cars, receives advances or the full price or major portion thereof, places orders with the manufacturer, gets the vehicles and delivers them to the purchasers after collecting the balance, if any, after making extra fittings, if asked for. The Commission for this service is collected from the consumer direct and in the instant case a sum of Rs. 6,000/- has been collected from the respondent as dealer''s margin. This is certainly a service for hire and when there is delay in delivery, there is deficiency in service. This may also constitute an unfair trade practice within the meaning of Section 36A(1)(b) of the M.R.T.P. Act. The complaint is therefore maintainable under the Consumer Protection Act.

NOW to the merits on which elaborate arguments have been advanced and additional documents filed on the consent of both sides. According to the respondent when he booked orders on 3.8.89 and handed over a pay order for Rs. 2,15,000/- he was orally assured that the vehicle would be delivered in two weeks and this averment is flatly denied by the appellant. An affidavit to that effect has been filed by the proprietor of the complainant concern. It is pointed out that in the letter dated 3.8.89 along with which the pay order for Rs. 2,15,000/- has been handed over, there is no reference to two weeks, but it reads "kindly have the vehicle delivered at a very early date". It seems that the assurance of delivery in two weeks was given in response to this letter. Even otherwise in the circumstances of the case, "very early date" cannot mean more than two weeks. The respondent has paid in lump-sum Rs. 2,15,000 which is more than manufacturer''s recommended retail price of Rs. 1,98,921.60. Is the second typed set filed by the appellant, it has produced the price list of the manufacturer (pages 1 & 2). It deals with four types of Contessa Cars and the car delivered to the respondent falls in category 1. The net dealer''s price including excise duty, special excise duty and fess is Rs. 1,92,921.60 and the recommended maximum retail price is Rs. 1,98,921.60, giving a margin of Rs. 6,000/- as Commission to the dealer. When the respondent has paid such a huge amount of Rs. 2,15,000/- which is over and above the listed price of the manufacturer, he would have naturally stipulated for delivery in a couple of weeks. We are satisfied that the vehicle was agreed to be delivered in two weeks. It is agreed for the appellant, the respondent had booked an order on 25.11.86 on payment of an advance of Rs. 10,000/- and though he cancelled the booking by his letter dated 6.10.88, he subsequently by his letter dated 20.12.88 revoked the cancellation and the booking on 3.8.89 must be taken not as a fresh order but only in pursuance of the booking on 25.11.86. As per clause II of the original booking the car will be delivered as and when available and hence the respondent cannot raise any question of delay. But as pointed out by the learned Counsel for the respondent subsequent to the revocation of the cancellation on 20.12.88, the appellant has on 5.6.89 returned the advance of Rs. 10,000/- with interest, which means that the revocation of the cancellation has not been accepted by the appellant. We hold that the booking on 3.8.89 is a new order. The learned Counsel for the appellant argue that the appellant collected the price amounts from other purchasers also and on 18.8.89 it opened a letter of credit with the State Bank, Pondicherry for Rs. 10,50,000/- in favour of Hindustan Motors, Calcutta for the supply of five Contessa Cars, that the car left the factory on 22.9.89 and reached Pondicherry on 2.10.89 and after check up and fitting of A.C., it was delivered to the respondent on 10.10.89 and there is therefore no delay on the part of the appellant. This explanation shows not only that the appellant has kept with in the sum of Rs. 2,15,000 for full two weeks before opening the I.C. but also that the appellant has been carrying on its business as a dealer not with his monies but with the monies of the purchasers. The copy of the letter of credit opened by the appellant with the State Bank, Pondicherry is found at pages 7 and 8 of the II typed set of the appellant. It is an irrevocable documentary credit in favour of M/s Hindustan Motors Limited, Calcutta, which is afforded negotiation of its draft at sight drawn for 100% of invoice value on the respondent. It is laid down therein that I.C. document presented for realisation must be accompanied by delivery challan of the transporter, if transported by road, or by the delivery challan of the respondent if delivered to the respondent from the manufacturer''s Warehouse at Pondicherry. These vehicles which have been transported by road have been delivered to the transporter on 22.9.89. The manufacturer must therefore have presented the I.C. for payment and realised its amount only on or after 22.9.89. Hence on and from 3.8.89 when the respondent handed over the pay order for Rs. 2,15,000/- till 22.9.89 at any rate the appellant has the benefit of this amount and it must disgorge this benefit to the respondent by way of interest.

THE matter may be looked at from another angle as well. A trader cannot charge for goods a price in excess of the price fixed and under Section 2(1)(iv) on the Consumer Protection Act a complaint to that effect can be made. THE interest accrued of the sum of Rs. 2,15,000/- from 3.8.89 when it was paid by the respondent till the date of delivery i.e. 10.10.89, is a gain to the appellant and a loss to the respondent. To the extent of this amount of interest, there is a charge of price in excess of the price fixed and has to be refunded to the respondent

THE learned Counsel for the appellant finally argued, that the appellant has given a confessional discount of Rs. 3,068/- in the final settlement (vide page 81 of the I typed set) and the respondent is not entitled to claim interest on the sum of Rs. 2,15,000/- on account of delay in delivery. According to Miss Seeta Badrinath, the learned Counsel for the respondent, this concession has been given in the respondent disputed the correctness of the excise duty collected. We cannot go into this question now. Suffice it to say that it is not the plea of the appellant that this discount was given as a solatium for the delay in the delivery of the vehicle. Hence there is no defence to the respondent''s claim. No other point is argued before us.

For the foregoing reasons, we hold that the respondent''s claim of interest for the sum of Rs. 2,15,000/- for a period of six weeks only is well founded. The District Forum has awarded interest at 18%. In the first typed set filed by the respondent there is the letter from Union Bank to the respondent (page 8) which shows that a term loan of Rs. 1,75,000/- has been sanctioned at 14% per annum. The next letter dated 20.2.91 reads : "presently as per Reserve Bank of India guidelines the rate of interest for commercial advance is 18%." It is clear that at the relevant point of time the rate of interest has been 14% only. We therefore find that awarding of interest at 14% per annum will be sufficient to meet the ends of Justice.

IN the result the appeal is allowed in part, the Judgment of the District Forum is modified, the rate of interest awarded is reduced to 14% from 18% and the appellant is directed to pay to the respondent a sum of Rs. 3,473/- instead of Rs. 4,465/- as ordered by the District Forum. IN other respects the appeal fails and is dismissed but without costs in the appeal. Time for payment is two weeks from the date of receipt of the copy of this judgment Appeal allowed.