Ch. Naga Tej Vs. Bmw India Financial Services Pvt Ltd., Rep. by Its Financial Manager and Another - Court Judgment

Oral Order: (R. Lakshminarasimha Rao, Member)

1. The complaint is filed claiming release of BME car by receiving a sum of Rs.5,00,000/- towards pending installments, a sum of Rs.10,00.000/- towards compensation for suffering mental agony and Rs.50,000/- towards costs.

2. The complainant is director of Sri Kaleshwari Travels and availed loan of Rs.34,51,000/- for purchase of BMW car which was later registered with registration number AP16 BY 0005. The car was used by the director of the company for his personal and family necessities. The car was hypothecated with the opposite parties. The complainant started paying the installments from June,2011 to the opposite party. The complainant had been to the USA on 24.01.2012 and returned to India on 24.01.2012. By the date he left India, the complainant paid the entire installments due and he informed the local branch of the opposite party that he would pay the installments after he returned to India.

3. As on 10.02.2012 there were 2 installments due and the car has not become NPA by the date and the opposite parties without issuing prior notice repossessed the car on 11.02.2012 when the vehicle was sent to garage for the purpose of servicing. The complainant requested the opposite party to release the vehicle and the opposite party did not respond to receive the demand draft .

4. The opposite parties resisted the claim on the premise that the complainant committed breach of terms of the contract and failed to pay the installments and that the complainant is a company carrying on commercial activity and M/s Kaleshwari Travels in whose name and for whose purpose the car was purchased is not a consumer and the complaint cannot be filed by the director of the company in his individual capacity. It is contended that it is the duty of the complainant to make arrangement for payment of loan installments and despite request, the complainant failed to pay the installments due and the opposite parties got issued notice dated 25.01.2012 to the complainant terminating the agreement and recalling the loan facility extended to the complainant. As per clause 23 of the agreement, any dispute arising out of the agreement, has to be referred to arbitration. By virtue of arbitration clause, the opposite parties filed application under Section 9 of the Arbitration and Conciliation Act before the District Judge, Delhi seeking appointment of receiver to repossess the vehicle.

5. The Court appointed receiver to take possession of the vehicle and the receiver had taken possession of the vehicle.. The arbitrator had sent notice to the complainant on 7.03.2012 and 30.03.2012 to appear before him and the complainant filed the complaint before this Commission. Hence, prayed for dismissal of the complaint.

6. The complainant has not filed his affidavit. The complainant has filed the doucments viz., Inventory sheet dated 11.02.2012, registration certificate, early termination dated 10.2.2012, passport of the complainant, statement of account of loan A/c No.CN00012232 and demand draft with cover letter dated 13.02.2012.

7. On behalf of the opposite party no affidavit has been filed. The opposite party has filed the documents viz., power of attorney dated 1Rs.6.11.2011, agreement dated 30.5.2011, statement of account dated 25.7.2012, legal notice dated 25.1.2012, orders of Additional District Judge, New Delhi dated 6.2.2012, notice for arbitration proceedings dated 7.3.2012, statement of claim dated 9.3.2012, notice for arbitration proceedings dated 30.3.2012.

8. The learned counsel for the opposite party has filed written submissions.

9. The points for consideration are:

i) Whether the complaint is maintainable in view of the initiation of arbitration proceedings and purchase of the car by a company?

ii) Whether the opposite parties rendered deficient service by repossessing the vehicle?

iii) To what relief?

10. POINT No.1: The facts beyond any dispute are that M/s Kaleshwari Travels Pvt Ltd purchased BMW car availing loan to the extent of Rs.34,50,000/- from the opposite parties and execution of agreement by M/s Kaleshwari Travels Pvt Ltd in favour of the opposite parties hypothecating the car and agreeing to pay installments regularly. It was agreed that the opposite parties can possess the vehicle in case of default committed in paying the loan installments. M/s Kaleshwari Travels Pvt Ltd failed to pay installments due and the opposite parties issued notice dated 25.01.1012 to pay the outstanding due within 7 days from the date of receipt of the notice. The opposite parties have requested M/s Kaleshwari Travels Pvt Ltd to surrender the vehicle which was hypothecated to them. As the installments were not paid, the opposite parties repossessed the vehicle on 10.02.2012 and initiated arbitration proceedings before the district Court, Delhi.

11. M/s Kaleshwari Travels running business and havingpurchased the car for its business purpose cannot be a consumer within the meaning of provisions of the Consumer Protection Act. Sections 2(1)(d) and (o) of the Consumer Protection Act, read as under:

“Section 2(1)(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 purposes 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.

Section 2(1)(o):

‘service means service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying a news or other information (but does not include the rendering of any service free of charge or under a contract of personal service).”

“The word ‘commercial according to the Oxford Dictionary means viewed as a matter of profit and loss. The word ‘purpose means ‘object which is in view or for which is made : ‘aim ‘amend. The word ‘commercial purposes would, therefore, cover an undertaking the object of which is to make a profit out of the undertakings. (Municipal Board, Unnao v. The State of U.P., 1957 All. L.J. 469 at 498).”

12. According to Oxford dictionary, it means “viewed as a matter of profit or loss”.

13. The word “commercial” is defined in the Concise Oxford Dictionary, New Edition of the 1990, at page 227, the word “commercial” is defined as ‘having profit as a primary aim rather than artistic etc. value (vide Dena Bank, Ahmednagar v. Prakash Birbhan Katariya, AIR 1994 Bombay 343 at 345).

14. The buying of goods and availing of services has been excluded from the ambit of the provisions of the Consumer Protection Act. We do not consider it necessary to discuss the limitation aspect as we have held the appellant firm not to be a consumer. The appellant is at liberty to approach the appropriate forum/court for rederessal of its grievance.

15. The National Commission in M/s. Anand Cane Crusher Vs. U.P. State Electricity Board reported in III (1993) CPJ 365 (NC) held that:

“The State Consumer Forum has also no jurisdiction to grant the reliefs, it has actually granted in this case viz. quashing the bills prepared on the basis of tariff for 'continuous power' consumers and directing the Electricity Board to bill the Complainant — M/s. Anand Cane Crusher hereafter at the 'non-continuous process' consumer tariff rate. It has no authority to give such relief under Section 14 of the Consumer Protection Act.”

16. Importantly the complainants are utilizing the vehicle for commercial purpose viz., for transport business. The Honble Supreme Court in Birla Technologies Ltd. Versus Neutral Glass and Allied Industries Ltd. reported in CDJ 2010 SC-1177 held:

“that the goods sold by the appellant to the respondent/complainant amounted to Rs.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. On the one 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”

17. In the light of the decision of the Honble Supreme Court and in the teeth of admitted commercial activity undertaken by the appellant, he cannot be termed as ‘consumer as defined under the provisions of the Consumer Protection Act.

18. After the opposite parties initiated arbitration proceedings, the complainant has filed the complaint before this Commission. The car was purchased in the name of that M/s Kaleshwari Travels Pvt Ltd and the complainant in his individual capacity has filed the complaint. M/s Kaleshwari Travels Pvt Ltd in which purchased the car has been running business in transport and the car purchased obliviously for its business purpose which is commercial purpose. For all the reasons the complaint is not maintainable and liable to be dismissed.

19. In the result the complaint is dismissed. There shall be no order as to costs.