Oral Order: (R. Lakshminarasimha Rao, Member)
1. The appeal is filed by the opposite parties in CC 160/2011 pm the file of the District Forum II, Krishna at Vijayawada challenging the order dated 20.03.2013.
2. The respondents are running jewel work shop in Vijayawada. The first complainant and one Murala Pradeep, attended demonstration at Chennai and agreed to purchase three German made Semi Automatic side cut cable chain machines of two different sizes i.e. 0.25 MM and 0.35 MM @ Rs.1,75,000/- each and three Indian Made Semi Automatic side cut cable chain Machine @ Rs.85,000/- each. On 20.04.2011 the 1st complainant paid an amount of Rs.5,80,000/- by cash and Rs.40,000/- by way of cheque bearing No. 103267 dt. 25.04.2011 to the appellants which includes Rs.6,750/- tax for German made machine and other charges.
3. The respondents agreed to purchase three German Made machines for Rs.1,75,000/- each and three Indian made machines @ Rs.85,000/- each from the appellants and paid an amount of Rs.5,80,000/- by cash and Rs.40,000/- through cheque bearing No. 103267 dt. 25.04.2011. The cost of the machine is Rs.5,75,000/-. The cost of tools and accessories of Rs..60,000/- , tax of Rs.6,750/-, packing and courier charges of Rs.30,000/- and operator charges of Rs.20,000/- amounts to Rs.6,41,750/- out of which the opposite parties offered discount of Rs.21,750/-. The first respondent paid Rs.2,30,000/- to the appellants on 20.4.2011 for supply of three Indian made machines.
4. The respondents submitted that the appellants informed the first complainant that after receiving balance of Rs.1,00,000/- the six machines would be delivered to the complainant and the first complainant paid an amount of Rs.98,000/- on 18.05.2011 by remitting the amount to the Account of the opposite parties. On 19.05.2011, the appellants dispatched three Indian made machines through Safe Express Private Limited and they did not send the three German made machines as also send their technical person for imparting training to the personnel working in the shop of the respondents.
5. The complainants submitted that the 1st respondent got issued notice dt. 10.06.2011 and corrigendum to the notice on 13.06.2011. the complainant got inspected the three Indian Made machines by a mechanic who informed them that the machines are defective and lack internal parts for utilization, as also, the machines are not in working condition. The respondents claimed for refund of the value of the machines paid by them to the opposite parties.
6. The appellants resisted the claim on the premise that the respondents entered into transaction for purchase of machines for commercial purpose and the complainants are not consumers. The entire transaction took place at Gandhi nagar in Agra. The District Forum has no jurisdiction. The matter involves several disputes facts which can be decided only by conducting elaborate trial. The three respondents entered into separate transactions and they cannot maintain single complaint. The appellants opened a stall in the exhibition organized at Chennai. On 20.04.2011,the first respondent and One Pradeep made enquiry with the appellants about the machines, Indian made automatic side cutting cable chain machines.
7. The respondents booked three machines in the name of three persons and issued cheque for Rs.40,000/- towards advance and promised to pay the balance within one month. The appellants requested the respondent to pay the balance amount, courier charges etc. of Rs.98,000/- and the first respondent remitted the amount of Rs.98,000/- on 18.05.2011 to the account of the appellants. The respondents demanded for issuing of separate bills for each machine. The had sent three Indian made automatic side cutting cable chain machines to the respondents who were received by them and the appellants requested the respondents to return the bill dated 11.5.2011 issued in the name of the firm. The respondents did not return the bill and filed the complaint. The machines are in working condition and they do not suffer any defect. There was no deficiency in service on the part of the opposite parties and the Ops prayed for dismissal of the complaint.
8. The first respondent filed his affidavit and the documents, Ex. A-1 to A-19. On behalf of the appellants, the second appellant filed his affidavit. The appellants had not chosen to file any documents,
9. The District Forum allowed the complaint on the premise that the machines supplied to the respondents were not defective and the appellants failed to deliver three German made machines even after receiving the amount of Rs.6,20,000/- from the respondents . The District Forum observed that non-supply of the German made machines amounts to deficiency in service on the part of the appellants.
10. Feeling aggrieved by the order of the District Forum, the appellants filed appeal contending that complaint is not maintainable as the claim arose out of commercial transaction which does not fall under the purview of the Consumer Protection Act and in absence of any deficiency in service or unfair trade practice, the District Forum has become Corum non judis.
11. The learned counsel for the appellants has submitted that the matter involves disputed questions of facts which has to be decided by Civil court and the complainants are not consumers within the meaning of Sec. 2(1)(d) of Consumer Protection Act. It has contended that the machines were purchased for commercial purpose and as such the complaint is not maintainable under the provisions of Consumer Protection Act.
12. The learned counsel further submitted that appellants have not rendered any service to the respondents for consideration. The inter transaction took place at Agra and Courts at Agra only have got jurisdiction to entertain the complaint. The appellants contended that they disputed Ex. A5 and A-6 and the District Forum erred in holding that the respondents booked three German made machines and three Indian made machines, in absence of any documents thereof.
13. The learned counsel for the respondents has filed written arguments.
14. The points for consideration are
(i) Whether the complainant is consumer and the complaint maintainable under the provisions of Consumer Protection Act ?
(ii) whether there is deficiency in service on the part of the opposite party.
(iii) To what relief ?
15. POINT No. 1 : The appellant no. 1, as seen from the brochure is a partnership firm engaged in the design and construction of machinery and tools meant for the use in the gold mithery, formal jewellery and costume jewellery sectors and it is involved in the production of machines for creation of change and jewellery . The appellants 2 and 3 are the partners of appellant no. 1 firm.
16. The complainants state that they placed orders or three German made machines and three Indian made machines and the opposite parties had sent Indian made machines withholding three German made machines. The opposite parties opened a stall in Gem and Jewellery India International Exhibition organized at Chennai and they had obtained postal address and e-mail address of Pradeep and sent the mails to him explaining about their product. The first complainant and Pradeep visited the factory of the opposite party no. 1 on 20.4.2011 and the first complainant booked three India made semi automatic side cut cable chain machine and issued cheque dated 25.4.2011 for an amount of Rs.40,000/- towards advance and promised to pay the remaining balance within one month therefrom.
17. A perusal of the record would show that the complainant No. 1 has placed for three Indian made machines in the name of his wife, the complainant no. 2, Mrs. Jayalakshmi Bhargavi, and the complainant no. 3, his brother, Bitra Paramesh. The learned counsel for the appellant has contended that the respondents purchased the machines for their business purpose and the transaction and disputes thereof cannot be decided by Consumer Forum. He has placed reliance on the following decisions:
(i) Laxmi Engineering works Vs PSG Industrial Institute, (1995) III SC 583
(ii) Cheema Engineering services Vs. Rajan Singh CDJ 1996 SC 1055
(iii) Kalpavruksha charitable trust Vs. Toshniwal Brothers CDJ 1999 SC 626
(iv) Birla Technologies Limited VS Neutral Glass and Allied Industries Limited CDJ 2010 SC
(v) Hindusthan Machine Tools Limited and another Vs. M/s. Ram Laxman Finance and Hire purchasers FA No. 174/2009.
(vi) FA No. 556/2008
(vii) FA No. 1082/2009
(viii) FA No. 32/2012
(ix) III (2007) CPJ 423
18. The learned counsel for the respondent has contended that the respondents are consumers within the meaning of 2 (1)(d) of C. P. Act as they are goldsmiths and they are skilled labourers doing their job work in making gold jewellery.
19. The respondents have not made any averment in the complaint, more particularly, there is no any statement in the affidavit of the first respondent as to their purchasing the machines for eking out their livelihood by means of self employment. The respondents are engaged in the business of making the gold ornaments and selling them on profit. The purchase of the machines meant for business of the respondents, predominantly the transaction thereto between the appellant and the respondents is for commercial purpose which excludes the dispute from the scope of the Consumer Protection Act.
20. In œLaxmi Engineering works œ (supra ), the Honble Supreme Court considered the status of purchaser of goods on the touchstone of explanation of section 2(1)(d) (i) of the Consumer Protection Act. The Supreme Court held that œthe exception mentioned in the section 2(1)(d)(i) of the Consumer Protection Act is subjected to another exception that œ commercial purpose? would not take away the purchaser from the ambit of œ definition œ of expression consumer , in case, the purchaser made use of the goods for commercial purpose for the purpose of earning his livelihood by means of self employment.
21. The scope of commercial purpose is expanded in Cheema Engineering Services ( supra ) and it was held that the purchaser of goods in order to qualify the definition of consumer within the meaning of section 2 (1)(d) of Consumer Protection Act, has to prove that he used the machine exclusively by himself and the burden of proof lies on him to establish that the goods purchased are used for self employment. The Apex Court observed :
œIn other words, the Explanation excludes from the ambit of commercial purpose in sub-clause (i) if section 2(1)(d), any goods purchased by a consumer and used by him exclusively for the purpose of earning his livelihood by means of self-employment. Such purchase of goods is not a commercial purpose. The question, therefore, is : whether the respondent has been using the aforesaid machine for self-employment? The word 'self-employment 'is not defined. Therefore, it is a matter of evidence. Unless there is evidence and on consideration thereof it is included that the machine was used only for self-employment to earn his livelihood without a sense of commercial purpose by employing o regular basis the employee or workmen for trade in the manufacture and sale of bricks, it would be for self- employment. Manufacture and sale of bricks in a commercial way may also be to earn livelihood, but "merely earning livelihood in commercial business", does not mean that it is not for commercial purpose. Self-employment connotes altogether a different concept, namely, he alone uses the machinery purchased for the purpose of manufacture by employing himself in working out or producing the goods for earning his livelihood. 'He' includes the members of his family. Whether the respondent is using the machine exclusively by himself and the members of his family for preparation, manufacture and sale of bricks or whether he employed any workmen and if so, how many, are matters of evidence. The burden is on the respondent to prove them. Therefore, the Tribunals were not right in concluding that the respondent is using the machine only for self-employment and that, therefore, it is not a commercial purpose. The orders of all the Tribunals stand set aside. The matter is remitted to the District forum. The District Forum is directed to record evidence of the parties and dispose it of in accordance with law within a period of six months from the date of receipt order.?
22. In the case on hand, there is no any averment in the complaint or in the affidavit of the first respondent that the machines were purchased for eking out their livelihood by means of self employment as provided in the explanation to Sec. 2(1)(d) of the Consumer Protection Act. The decision is squarely applicable to the facts of the present case. In all the aforementioned cases, the ambit and scope of commercial purpose is elaborately dealt by this Commission
23. In Birla Technologies Limited, the question that fell to the consideration of the Honble Supreme Court was whether the service availed by a person for commercial purpose can invoke the jurisdiction of Consumer Forum in regard to any dispute relating to the service availed of. Their Lordships, held :
œ the goods sold by the appellant to the respondent/complainant amounted to `goods' and that such goods were purchased for commercial purpose of earning more profits, there could be no dispute that even the services which were offered had to be for the commercial purpose. Nothing was argued to the contrary. It seems that the whole error has crept in because of the wrong factual observation that the complaint was filed on 1.8.2000. In that view, it has to be held that the complaint itself was not maintainable, firstly, on the count that under Section 2(1)(d)(i), the goods have been purchased for commercial purposes and on the second count that the services were hired or availed of for commercial purposes. The matter does not come even under the Explanation which was introduced on the same day i.e. on 15.3.2003 by way of the amendment by the same Amendment Act, as it is nobody's case that the goods bought and used by the respondent herein and the services availed by the respondent were exclusively for the purpose of earning the respondent's livelihood by means of self- employment. In that view, it will have to be held that the complaint itself was not maintainable in toto.?
24. The Honble National Commission in the decision reported in III (2007) CPJ 423 (NC) held that the purchaser of machine who purchased it not for exclusively earning livelihood and to supplement and enhance income cannot be a consumer as it is excluded by the commercial purpose to be amenable to the jurisdiction of Consumer Forum.
25. The question of jurisdiction is one of the vital aspects for a Court or Tribunal since it involves the challenge to the very competence of the Tribunal. The order or decree passed by the Court or Tribunal is not treated on the same footing where it passed without territorial jurisdiction or pecuniary jurisdiction and the jurisdiction as to the subject matter. The order passed without the jurisdiction of the subject matter is no order in the eye of the law as the very power required to pass the order or decree is lacking in the court or tribunal.
26. Section 2(1)(d) of the Consumer Protection Act confers status of consumer is the person who avails service or purchases goods not for any commercial purpose and in case, the service is availed or goods are purchased for commercial purpose it is subject to the condition that such commercial purpose is meant for his eking out his livelihood by means of self-employment.
27. The word commercial is an adjective defining the nature of a transaction or activity irrespective of the fact whether that transaction or activity is on a larger scale or on a small scale. If any activity or transaction is for the purpose of profit making it becomes commercial. The appellant, as such cannot maintain the complaint before the Consumer Forum.
28. The respondents have not come forward to state that the machines were purchased not for commercial purpose and for eking out their livelihood by means of self employment. For the aforementioned reasons and inview of the ratio laid in the above mentioned decisions, we are for the considered view that the respondents are not consumer within the meaning of Section 2(1)(d) of the Consumer Protection Act. the point is answered accordingly.
29. Point No. 2 : The respondents are held to be not consumers and they cannot invoke the jurisdiction of the Consumer Forum. Therefore, there need to be no any discussion under this point.
30. Point No. 3: In the result, the appeal is allowed setting aside the order of the District Forum. The respondents are at liberty to approach appropriate Court/Forum and in such an event, the period spent between the filing of the claim before the District Forum and disposal of the matter today by this Commission will be excluded under section 14 of Limitation Act, 1963 in the light of the decision of the Honble Supreme Court in œTrai Foods Ltd. Vs. National Insurance Company Ltd and others reported in (2004) 13 SCC 656.