Ramesh Kumar Rohila vs Gseven Computer Business (P) Ltd. and another

Present Revision Petition has been filed by the Petitioner/Complainant against the impugned order dated 2.11.2016, passed by Delhi State Consumer Disputes Redressal Commission at New Delhi (for short, ''State Commission'') in First Appeal No. 368 of 2014. 2. Brief facts of the case are that Petitioner/Complainant is the proprietor of the firm, M/s Care well Pipes with an office at 201-202, 2nd Floor, Bhanot Bhavan, Commercial Complex, Azadpur, Delhi. The Petitioner had purchased accounting software Tally ERP9(in short "software") for his personal use from Respondent No. 1/Opposite Party No. 1 vide invoice No., GSCBPL/08-09/803 dated 30.1.2009 for a sum of Rs. 54,000. It was alleged that the said software was licensed as Tally Gold SN72314289 and Tally Silver SN79312013 by Respondent No. 2/Opposite Party No. 2, who was the manufacturer/developer/programmer of the aforesaid software and sold the same through Respondent No. 1. At the time of purchase of software, Respondent No. 1 had agreed and confirmed certain specifications of the software on the basis of which order for the software was confirmed. After the software was installed, the Respondent No. 1 started delaying the service which it had promised and in the course of time the Petitioner noted defects in the software and deficiency in the service on the part of the Respondent No. 1. Respondent Nos. 1 and 2 both severally and jointly, have not rectified below mentioned various other defects/problems; details of which were sent to them telephonically, personally to their office and through e-mails on various occasions: (a) Chartered accountant and user cannot access the data online through the internet as promised during the purchase of the software. (b) Turnover in local VAT return reports (Forum DVAT 16) and CST Sales Tax return (Form 1) does not match each other and also the description of top three sale items is wrongly mentioned. (c) The GTO sale figure does not explore the net sale assessable value (Total sale minus discount for all ledgers) like gross purchase value for all ledgers in the Profit & Less account report. (d) VAT rate cannot be changed or altered like CST as per the notification of the Govt, whereas it was promised that user can alter tax rate any tune. (e) Any stock item cannot be inserted in between the other two stock items in the invoice like deletion of an item when edition. (f) During purchase entry before save voucher, the stock items: quantity are not updated when item allocation entered against list of order pending like sale invoice or payment vouchers. (g) The Single Voucher e.g. Receipt voucher does not show the total amount against two ledger entries and also does not indicate "as per details" (h) Price list has only sale rate and does not have purchase rate. (i) Showing undesirably in. the computer of the complainant under licence Gateway of tally "tally.net subscription expired" a payment default like message although the complainant does not have any outstanding. Also the Opposite Party-2 has online advertisement like messages such as latest update available in the computer of the complainant without the permission of the complainant. It can be hidden as additional feature but certainly not in front of the computer which not only reduces the space for other working fonts but also keeps on showing as an unwanted element always in front of eyes of the user. A copy of the computer screen picture of tally software showing the subscription expiry and latest update is hereby attached an Annexure-4. (j) Memory access violation problem, is repeated very often. The Respondent Nos. 1 and 2 have clubbed the update version cost with other costly services such as data synchronization thus making the update version unnecessarily costly, whereas the user may or may not need the additional services. Both the Opposite Parties refused to give update version alone and demanded exorbitantly high amount of money of Rs. 10,800 per annum (Rs. 8,100 for multi-user + Rs. 2,700 for single user) than the cost promised of Rs. 500 at the time of sale of software. Thus they had adopted unfair trade practices by clubbing the cost of update version with other services. 3. The Respondent No. 1 had not arranged the full return amount of Rs. 5,402 till date from the Respondent No. 2 as promised and only part payment of Rs. 4,051 has been paid on date 2.8.2010 through chartered accountant Shri Vikram Aggarwal. 4. The complaint was earlier rejected at admission stage by the District Forum vide order dated 1.2.2011 by holding that Petitioner was running a commercial enterprise and software was purchased for commercial activity and as such was not a "consumer" as prescribed under the Act. The Petitioner then filed First Appeal before State Commission i.e. F.A. No, 103 of 11 whereby the order passed by the District Forum was set aside by observing that the District Forum had passed a very cursory order and had given no reasons. It was held that the order was not sustainable and the matter was remanded back to the District Forum for further proceeding in accordance with law. 5. Respondent No. 2 had contested the complaint case by filing a detailed written statement wherein it was contended that the complaint was not maintainable since the Petitioner/Complainant was not a ''consumer'' as defined under Section 2(1)(d) of the Act. The appellant/complainant had more than 10 employees and had a large turnover worth crores. The software purchased was not used for self-employment but was for commercial purpose to make profits. The software was used for accounting, generation of cash memos, recording of all types of inventory transactions etc. which were clearly in the nature of commercial activities. The allegations about defects were totally denied by respondent-2/OP-2. It was further stated that Respondent-2/OP-2 and respondent-1/OP-1 operate on a principal to principal basis only and not on a principal agent basis. Respondent No. 2/OP-2 was not responsible for any alleged misrepresentation if any, made by the OP-1/Respondent No. 1. 6. The Respondent No. 1 filed written response to the complaint along with written submissions wherein the alleged deficiencies/defects in the software were totally denied. It was also contended that the appellant/complainant was not a ''consumer'' as defined under Section 2(l)(d) of the Act. The software was used for accounting, invoicing and recording of day-to-day business transaction which were clearly in the nature of commercial activity. The Complainant had been making different statements. On one hand, he had alleged that from the use of software, no product or profit was generated, on the other hand, he had alleged that due to alleged defects in the software, he was unable to issue sale invoices to his customers and business of appellant/complainant suffered badly due to slow down in sale as a result of which he was put to loss. Thus, it was clear that the software with VAT/CST/Excise/TDS accounting of business transactions was used for business accounting: and was purely meant for commercial purpose. It was prayed that complaint was not maintainable and was liable to be rejected. 7. The District Consumer Disputes Redressal Forum, North West Shalimar Bagh, Delhi (for short,'' District Forum'') vide its order dated 20.3.2014, while dismissing the Complaint filed by the Petitioner, held as under; "Apart from the above, we may state that the complainant has mentioned a number of discrepancies/defects in the software supplied to him by the OPs. In response to the averments made in the complaint as regards the defects/discrepancies the OPs have filed written statements and affidavits denying that the software supplied to the complainant suffers from the alleged discrepancies/defects. In his complaint, the complainant has listed as many as seven defects/discrepancies in the software. Since the OPs have not admitted to these defects/discrepancies, we are of the considered opinion that the allegations levelled by the complainant cannot be adjudicated without elaborate evidence being led by the complainant and his witness being subjected to a detailed and lengthy cross-examination. At any rate, the matter in controversy cannot be decided under the summary procedure prescribed in the Consumer Protection Act. Consequently, we hold that the present complaint is not maintainable in this Forum. The same is hereby dismissed." 8. Aggrieved by the order of the District Forum, the Petitioner filed an Appeal before the State Commission. While dismissing the Appeal vide their order dated 2.11.2016, observed as under: "26. It is the case of appellant/complainant that he is running business under the name of M/s. Carewell Pipes. It is also admitted position that he has purchased ''the software'' from respondent-1/OP-1 which is manufactured by respondent No. 2/OP-2. It is also admitted position that the appellant/complainant is having a turnover worth crores and had employed more than 15 employees. In these circumstances it cannot be said that he is under self-employment as Proprietor of aforesaid firm as is alleged. As per own case of appellant/complainant he is using the software for accounting purposes for his customers. The appellant/complainant has alleged in the complaint that due to not removing the defects and holding functioning of invoice, top file, the appellant/complainant was unable to issue any sale invoice to his customers and all the business of appellant/complainant suffered badly resulting slowdown in sale thus putting him to a heavy loss. The above averments of appellant/complainant show that the software was purchased for earning profits. 27. It may also be mentioned that in replication while referring to para 9 of the complaint, the appellant/complainant has averred as under: "It is further submitted that the complainant (Proprietor Carewell Pipes), is using the software exclusively in own business of pipes where accounting and invoice is prime and lifeline for survival of business in today''s scenario and is essential for his clients in day-to-day activities. Further, heavy irreparable loss and damage is being caused to the complainant without his fault. The complainant is badly suffering due to decline in pipe sales because of nonfunctioning or obstruction in the operation of the software being a prime tool of accounting in business. Due to drop in sale, apart from the huge personal loss, there is also a loss to the Exchequer in terms of sales tax/VAT to the tune of several lakhs of rupees. And further the pipe sale business is being severely affected due to non-functioning by date bar or cease of software by making licence invalid through online intervention by OP-2." 28. In the evidence by way of affidavit, the aforesaid averments are made on oath. Further the appellant/complainant has stated in the affidavit that due to alleged defects, heavy damage due to loss of profit has occurred which the deponent might be earning from the sate of pipes to his customers as the sale drastically came down because these days the customers do not wait for a moment for billing issues and on various occasions the customers cancelled the order and purchased the material from other sources thus causing an irreparable loss of business to the appellant/complainant. 29. The aforesaid statement on oath by the appellant/complainant clearly demonstrates that the subject software had a close nexus with the commercial activities being carried on by the appellant/complainant and that it was an integral part of the business. 30. The alleged defects which the complainant has pointed out in software which are already reproduced above shows that the appellant/complainant had purchased the software for use in business activities. 31. The Harsolia Motors case (supra) sought to be relied upon, by the appellant/complainant is not applicable to the facts of present case since the said matter deals with insurance policies in a completely different context and the same cannot be compared/adopted to the present case in any manner whatsoever. Even the case of Regional Provident Fund Commissioner Shiv Kumar Joshi (supra) is not applicable to the facts of present case as the said case mainly deals with the question of law as to whether the provisions of the Consumer protection Act could be invoked against the Provident Fund Commissioner by a member of the Employees Provident Fund Scheme and hence, the said case cannot be invoked in the facts and circumstances of the present matter. Even the case of Laxmi Engineering Works (supra) does not help the appellant/complainant''s case in any manner, 32. In view of the above discussions, the contention raised by the appellant/complainant that the software is for personal use is baseless. The own case set up by appellant/complainant in the complaint, the evidence by way of affidavit of appellant/complainant, the alleged defects in the software reproduced in preceding paras clearly show that the software was purchased for use in running large scale business having turnover of crores. The software was used for discharging various commercial activities and motive was to maximize the profits as such appellant/complainant is not a "Consumer" tits defined under the Act. 33. We also find no reasons to interfere with the reasoning given by the learned District Forum that the findings on the alleged defects cannot be given without elaborating evidence being led by both the parties. We find that alleged defects are totally denied by the respondent No. 2/OP-2. There is an affidavit against affidavit. As such we agree with the opinion of the learned District Forum that the allegations levelled by the appellant/complainant cannot adjudicated without elaborate evidence being led by the appellant/complainant and his witnesses being subjected to detailed and lengthy cross-examinations which is not possible in a Summary Procedure under the Act. 34. We find no illegality or infirmity in the impugned order passed by the learned District Forum. 35. We may mention that it has been pointed out on behalf of the respondents/OPs that the appellant/complainant had filed the complaint in the year 2011 and since then they have been unnecessarily dragged into litigation. It is submitted that appellant/complainant is the neighbourer of respondent-1/OP-1. It is submitted that even during the pendency of the present appeal, the appellant had moved to the National Commission for early disposal of the appeal. Thereafter, he had approached the Hon''ble Supreme Court for early hearing. It is submitted that for no reasons the respondents/OPs have been harassed by the appellant/complainant. Learned Counsel submits that if the appellant/complainant is not satisfied with the software, without admitting any deficiency therein and without prejudice to their rights and contentions, the respondent-1/OP-1 is ready to return the amount of software which appellant/complainant had paid to respondent No. 1/OP-1. However, the appellant/complainant has refused to accept the said offer 36. In view of the above discussion, the appeal stands dismissed." 9. Hence, the Revision Petition. 10. The present Revision Petition has been filed with delay of 5 days. However, no application for condonation of delay has been filed on behalf of the Petitioner. 11. We have heard the Petitioner in person and gone through the record very carefully. 12. The Petitioner contended that the order of the State Commission should be set aside as they had erred in coming to the conclusion that he was a not a ''Consumer''. He further contended that he had bought the software in question from the Respondents not for resale but for the use of his business and earning for his livelihood by means of self-employment. The Petitioner relied upon the judgment cited in the matter of Harsolia Motors v. National Insurance Co. Ltd., I (2005) CPJ 27 (NC). He has drawn our attention towards Paras 21 to 23 of the cited judgment, which reads as under: "21. If the goods are purchased for resale or for commercial purpose then such consumer would be excluded from the coverage of Consumer Protection Act, 1986. Such illustration could be that a manufacturer who is producing one product A, for such production he may be requited to purchase articles, which may be raw-material, then purchase of such articles would be for commercial purpose. As against this, the same manufacturer if he purchases a refrigerator, a. television or an air-conditioner for his use at his residence or even in his office, it cannot be held to be for commercial purpose and for this purpose he is entitled to approach the Consumer Forum under the Act. 22. Similarly, a hospital which hires the services of a medical practitioner, it would be a commercial purpose. But, if a person avails of such services for his ailment it would be held to be not a commercial purpose. 23. Further, from the aforesaid discussion, it is apparent that even taking wide meaning of the words for any commercial purpose it would mean that goods purchased or services hired should be used in any activity directly intended to generate profit. Profit is the main aim of commercial purpose. But, in a case where goods purchased or services hired in an activity which is not directly intended to generate profit, it would not be commercial purpose." 13. After going through the above said cited judgment, it seems that the Petitioner has overlooked the relevant Para 24, which reads as under: "24. In this view of the matter, a person who takes insurance policy to cover the envisaged risk does not take the policy for commercial purpose. Policy is only for indemnification and actual loss. It. is not intended to generate profit." 14. The main issue involved in this Revision Petition, whether the Petitioner/Complainant comes within definition of a ''consumer'' as defined under Section (2)(l)(d) of the Consumer Protection Act, 1986 [for short, ''Act''). In order to answer the aforesaid vital question, it would be useful to pursue the amended definition of a ''Consumer'' along with its ''Explanation'' as provided under Section 2(l) (d) of the Act, which reads as under: "(d) Consumer means any person who - (i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or (ii) [hires or avails) of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person (but does not include a person who avails of such services for any commercial purpose]; [Explanation - For the purpose of this clause, "commercial purpose" does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment]." 15. The State Commission correctly concluded "that reading of the ''explanation'' makes it clear that benefit of explanation is only to the available to the person who avails the services exclusively for the purpose of earning his livelihood by way of self-employment. The onus of proving that the appellant/complainant is covered by the explanation is upon him". Moreover, the Petitioner himself has admitted in Para 1 of his Complaint filed before the District Forum that he is owner of proprietor of the firm, namely, Ms. Carewell Pipes having office at 201-202, 2nd Floor Bhanot Bhavan, Commercial Complex, Azadpur, Delhi. It is also admitted fact that about 10-15 employees are working in firm of the Petitioner/Complainant, 16. The ratio of the judgment in case of Harsoli Motor case (supra), sought to be relied upon by the Petitioner, as correctly concluded by the State Commission are not applicable to the facts of the present case because the said matter deals with the insurance policies in a completely different context. 17. Thus, in view of the above discussions, we find that no jurisdictional or legal error has been shown to us in the impugned order to call for interference in the exercise of powers under Section 21(b) of the Consumer Protection Act, 1986. The order of the State Commission does not call for any interference nor does it suffer from any infirmity or erroneous exercise of jurisdiction or material irregularity in dismissing the application for condonation delay as also dismissing the appeal preferred by the Petitioners. Thus, the present Revision Petition is hereby dismissed as also the Complaint is dismissed. However, liberty is granted to the Petitioner to file a fresh Complaint oh the same cause of action in the appropriate Forum. Revision Petition dismissed.