TATA MOTORS LIMITED vs SANT BAHADUR SINGH

BOTH these Appeal Nos. 857/05'' by the manufacturer and the dealer of Tata Vehicles and No. 1135/05 by Tata Finance Ltd. , heard as connected matters, arise from the order dated 9. 3. 2005 passed by District Consumer Disputes Redressal Forum, Rewa in C. C. No. 145/98.

FOR the purpose of this order respondent No. 1-Sant Bahadur Singh in both the appeals shall be referred as complainant, while appellants-Tata Motors Ltd. , Commercial Automobiles and Tata Finance Ltd. shall be referred as opposite party Nos. 1, 2 and 3 respectively. The dispute pertained to a 407 truck manufactured by opposite party No. 1 and made available to complainant on hire purchase basis on 14. 6. 1995 by opposite parly No. 3 through opposite party No. 2-dealer. The grievance of the complainant before the District Forum was two fold : one, that the chassis of the tractor developed crack within the warranty period, but the same was not replaced by the opposite parties and two, ''that the truck was wrongly repossessed and illegally sold by opposite party No. 3-Finance Company. The complaint was resisted by the opposite parties through two separate written statements and preliminary objection as to the tenability of the complaint on the grounds that truck in question was purchased for commercial purpose and that there being arbitration clause in the hire purchase agreement the complaint was not maintainable. However, the Forum below over-ruled both the objections and upheld the complaint of the complainant directing all the opposite parties to provide to the complainant a new truck of the same capacity and also pay to him compensation Rs. 10,000 , besides cost Rs. 1,000.

As regards the repossession and sale of tractor by O. P. No. 3-Tata Finance Ltd. it may be observed at the out-set that the truck in question was made available to the complainant on hire purchase basis and the ownership of the truck vested with the financier company (O. P. No. 3) and the complainant was only a hirer. Hon''ble the National Commission in the case of Ram Deshlahara v. Magma Leasing Ltd. , III (2006) CPJ 247 (NC), has held that under a hire purchase transaction the financier does not render any service within the meaning of Consumer Protection Act and the hirer-complainant is, thus, not a consumer. The complaint filed by respondent No. 1 was, therefore, not maintainable and his remedy lay elsewhere not under the provisions of the Consumer Protection Act. It will be thus seen that no order for replacement of tractor or payment of any compensation could be made against O. P. No. 3-Finance Company and the order passed by the District Forum in this regard is liable to be set-aside on this short ground alone.

THIS leaves us with the question of manufacturing defect in the said tractor. There is documentary evidence available on record that on 15. 4. 1996 when the complainant took the said tractor for servicing to Sunny Auto Agency, which was then the authorised service agent of O. P. No. 1-company, the complainant was informed that the chassis of the vehicle is cracked. In the job card (vide Ex. P-30) it was clearly stated that new chassis is not available with the agency and that the same shall be supplied on receipt of it from the manufacturing company. As already stated Sunny Auto Agency was the authorised service agents of the O. P. No. 1-company and so, the acknowledgement made in the job card is binding on the O. P. No. 1-company. Even otherwise, there is no reason to disbelieve complainant''s evidence on that point. O. P. Nos. 1 and 2 i. e. the manufacturer and the dealer have resisted complainant''s complaint in this regard on the ground that the truck in question having been hired for commercial purpose, the complaint was not maintainable inasmuch as the complainant was not a "consumer" as defined under Section 2 (1) (d) of the Consumer Protection Act. The Forum below has over-ruled the objection and in our opinion rightly, as the truck was hired by the complainant for earning his livelihood by way of self employment. Complainant''s statement in that regard made on his affidavit, could not be challenged or rebutted successfully by the opposite parties. The case of the complainant thus fell within the exception as provided by the explanation to Clause (d) of Section 2 (1) of the CP Act. Even otherwise, the crack in question had developed the said crack during the warranty period and replacement of damage part of the vehicle forms part of service promised to be rendered by the opposite parties, the manufacturer and the dealer. Legal position on the point is made luculent by the National Commission in the case of East India Construction Co. and Anr. v. Modern Consultancy Services and Ors. , II (2006) CPJ 289 (NC), in following words : "the first issue has been answered by this Commission in a catena of judgments wherein it has held that even though the machine/equipment is used for commercial/industrial purpose if any manufacturing delect occurs during the warranty period then the issue is covered under the Act and for that purpose purchaser of the equipment is entitled to file a complaint under the Act. This point has been elaborated in the following judgments some of which are quoted below : "meera and Co. Ltd. v. Chinar Systex Ltd. , II (2004) CPJ 24 (NC) and Amtrex Ambience Ltd. v. M/s. Alpha Radios and Anr. , I (1996) CPJ 324 (NC ). "

Mr. Ajay Mishra learned Counsel for opposite party Nos. 1 and 2 has pointed out that the truck had met with accident twice and the damage caused in any such accident was not covered by the warranty. We are not persuaded by the argument. There is evidence on record to show that the truck met with an accident on 7. 6. 1996 and then on 24. 5. 1997 i. e. much after the said crack being noticed in the truck on 15. 4. 1996. The crack in chassis was not the result of any such accident, but due to manufacturing defect. Both the manufacturer and the dealer were, therefore, liable to replace the chassis or pay its price to the complainant.

THE Forum below has however, ordered for replacement of the entire vehicle. This order in our view, is not in tune with Section 14 of the CP Act which enumerates the reliefs which a Forum can grant to a consumer. It was not a case where the entire vehicle was found defective, but only a part of it i. e. the chassis was defective. Needless to say that the chassis is a separable part of the vehicle and the engine of the old vehicle could very well be fitted in a newly replaced chassis. So the only relief the complainant was entitled to get either the chassis replaced or recover its price from the O. P. Nos. 1 and 2. Now that the truck has been repossessed by the O. P. No. 3-Financier the question of replacement of the chassis does not arise. The only alternative thus left is to compensate the complainant for the said deficiency on the part of the O. P. Nos. 1 and 2. While computing the compensation it has to be borne in mind that the original chassis (less than two years old) though developed cracks was used by the complainant even after detection of the said defect and the vehicle also suffered two accidents before it was finally repossessed and sold by O. P. No. 3. The vehicle was sold along with the said chassis and naturally the sale proceeds received by O. P. No. 3 also included the cost of the said chassis. Under all these circumstances, it is almost impossible to assess the exact loss suffered by the complainant. In our considered view the interest of justice would be served by awarding general damages Rs. 50,000, besides cost Rs. 5,000 to the complainant. In the result, the Appeal (No. 1135/2005) filed by O. P. No. 3-Tata Finance Ltd. is allowed in toto. The order passed by the Forum is set aside as against this opposite party. The complaint of respondent No. l-complainant against this opposite party shall stand dismissed. Appeal No. 857/2005 filed by O. P. Nos. 1 and 2 is allowed in part and to the extent indicated above. The order passed by the Forum below for supply of new vehicle and payment of compensation is set aside and instead it is directed that these opposite parties shall jointly and severally pay to complainant compensation Rs. 50,000 with interest @ 9% p. a. from the date of complaint i. e. 30. 4. 1998. They will also bear complainant''s cost of both the Fora and the same is quantified at Rs. 5,000. 8. This order be retained in Appeal No. 857/2005 and a copy be placed in the record of Appeal No. 1135/2005. Ordered accordingly.