Rajiv Motors Ltd. vs Jiwan Lal Marken (Dr.)

THE moot point for consideration in this revision petition relates to whether the excise duty levied on a motor vehicle at the time of its rolling out of the factory premises but delivered to a customer after the Government has announced a reduction in the excise duty can be refunded to the customer on his plea that "the price prevailing at the time of delivery is chargeable -

THE District Consumer Disputes Redressal Forum, UT of Delhi (For short the District Forum'') has in this case held that the customer would not be entitled to any refund of the excise duty since the manufacturer has already deposited the same with the Govt. and there is no evidence to show that paid Excise Duty had been refunded by the Government to the manufacturer. The State Commission, Delhi, however, has taken the view that the price of the vehicle is applicable on the date of delivery and non -refund of the excess amount of Excise Duty consequent to its reduction on the date of the delivery of the motor vehicle will amount to unfair trade practice.

FACTS of the case in brief are that -The respondent/complainant booked a Deluxe Ambassador Car with the petitioner on 26.2.1993. The petitioner is the authorized dealer of the Hindustan Motors, manufacturer of Ambassador Cars. On 28.2.1993, the Govt. announced the reduction in Excise Duty. As a consequence thereof, the price of the car allegedly came down by Rs. 22,700. When he claimed the refund thereof, the petitioner/opposite party failed to refund the said amount and he, therefore, filed a complaint before the District Forum. It was contested by the petitioner/opposite party who filed their written statement. On perusal of the evidence produced by both sides, the District Forum dismissed the complaint. When the matter was appealed by the respondent/complainant before the State Commission, it has vide its order dated 8.12.2004 held that the price of the vehicle is applicable on the date of the delivery and since the Excise Duty had been reduced by the Government when the car was delivered on 5.3.1993, the respondent/complainant was entitled to the refund of the said amount. Aggrieved thereupon the petitioner/opposite party - dealer has filed this revision petition. We have heard the learned Counsel for the parties as also perused the records of the case.

THE main thrust of the arguments advanced by the learned Counsel for the petitioner is that the State Commission has misconstrued that the petitioner has charged more than the price prevalent on the date of delivery. It ought to have taken into account that the car in question had come out of the factory premises of the manufacturer on 31.1.1993 vide invoice No. 04/00719/92 (Annex. 4). The prevalent Excise Duty on that date had already been paid by the manufacturer to the Govt. It arrived at the dealer''s (present petitioner) premises on 9.2.1993 when pre -delivery inspection was carried out. Thus, the amount of Excise Duty paid by the manufacturer had already been billed into the price of the car. The respondent/complainant booked the car on 26.2.1993 and deposited its price on the same day. According to the learned Counsel, the sale/purchase transaction was completed on 26.2.1993 itself but for certain requirements such as fitting of accessories, registration and insurance of the vehicle, etc. without which the vehicle could not be taken on road by the purchaser. For these formalities and certain improvement asked for by the respondent/complainant himself, the delivery could take place only on 5.3.1993. As far as the petitioners were concerned, the vehicle was ready for delivery on 26.2.1993 itself.

CONTENDING further he submits that even otherwise the State Commission could not direct the petitioner to refund the reduction in the excise duty which had already been deposited by the manufacturer with the Government as the reduction is only prospective and once deposited in the Govt. account, it could not be asked for refund unless there is special clause with regard to rebate on Excise Duty for ambulance, etc. This is not the case here. The Government notification with regard to the levy/reduction in excise duty being prospective, the State Commission was not justified in asking the petitioner to refund the difference in the Excise Duty as whatever amount was charged had already been included and had merged in the price on that date.

LEARNED Counsel for the respondent/complainant on the other hand has contended that as per the footnote on the receipt, the petitioner -dealer could charge the price prevailing at the time of delivery. This being a contract between the parties, the dealer could charge only on the basis of the prevailing rate of Excise Duty on the date of delivery and not at the higher rate of Excise Duty which had already been paid and, therefore, he was fully entitled to the refund of the excess amount.

WE have carefully considered the matter and perused the records of the case.

CLEARLY and undisputedly, the car in question which had rolled out of the manufacturer''s factory premises had been received by the dealer on 9.2.1993. The pre -delivery inspection of the car was also conducted on the same day. The billing documents for the said car in favour of Shri Jivan Lal Marken, respondent/complainant were prepared on 26.2.1993 and payments too were made on the same day. There is another document dated 27.2.1992 with regard to the same car, which was prepared for the delivery of the car to the complainant who, however, did not want anything to be done on that day as it happened to be an inauspicious Saturday as per the version of the petitioner. When a careful perusal of all these documents in chronological order is taken into consideration, it cannot but be held that for helping the purchaser/complainant to facilitate completing the legal requirement such as registration and insurance, etc., the dealer was fully prepared to deliver the vehicle on 26/27.2.1993 itself. That it got delayed by few days during which the excise duty got reduced will therefore not entitle the respondent/complainant of any refund.

LEARNED Counsel for the respondent had referred to an order of this Commission in Maruti Udyog Ltd. v. Mrs. Vanita Sapra and Anr., II (2004) CPJ 43 (NC), and has contended that "the price of the vehicles prevailing on the date of delivery would be payable". The controversy therein was that M/s. Pasco Automobiles, the dealer had informed the purchaser giving an option to replace the FDR of Rs. 35,000 by a demand draft for the C'' form price of the vehicle to retain the seniority of booking. This was to be done before 15.12.1990. The respondent No. 1 accordingly deposited the amount of the car in terms of C'' form price of the vehicle. The respondent/complainant sought refund of Rs. 4,861.13 paise which was charged as enhanced price, besides other reliefs. In the meantime, the price of the vehicle was increased by the manufacturer for which he was asked to pay the additional amount. It was in that backdrop that National Commission set aside the order passed by both the Fora below and ordered that the amount of Rs. 4,861.13 paise paid in excess of C'' form price need not be refunded to respondent No. 1 as there was a contract between the parties to charge the price of the vehicle prevailing on the date of delivery. Clearly, the dispute therein did not relate to any increase/decrease of the statutory excise duty. It pertains to increase of the cost of the car by manufacturer and there was an affidavit with regard to an agreement by the parties. The facts in the case in hand are totally different. Herein, the State Commission has failed to appreciate the concept of Excise Duty which is levied as per rate prevalent on the date of exit of a vehicle from a manufacturing unit and cannot be varied subsequent thereto. Any change effected in the Excise Duty operates only prospectively and, therefore, the question of refund of this statutory Excise Duty does not arise. In this case, neither the manufacturer nor the dealer has retained or benefited from the reduction of Excise Duty and, therefore, there is no justification to make the petitioner -dealer liable for refund of the difference of the said duty. We are, therefore, of the view that the order passed by State Commission cannot be sustained and accordingly the revision petition is accepted, however, with no order as to costs. R.P. allowed.