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1997 Supreme(Bom) 246
IN THE HIGH COURT OF BOMBAY
(N.C.D.R.C., New Delhi)
V. Balakrishna Eradi, President; S.S. Chadha, S.P. Bagla C.L. Chaudhry, Members.
Engineers International ors. ..... Appellants.
Versus
D. V. Vasudeva Rao...... Respondent.
First Appeal Nos. 665 and 805 of 1994, decided on 19-5-1997.
Advocates appeared :
V. Ramasubramaniam, for the appellant in F.A. No. 665/94 for respondent No. 1 4 in F.A. No. 805/94.
K.K. Kishore, for the respondent in F.A. No. 665/94 and for appellant in F.A. No. 805/94.
K.S. Katari, for the respondent Nos. 2 4 in F.A. No. 805/94.
THE STATE COMMISSION'S ORDER DIRECTING THE RESPONDENT TO PAY THE PRICE OF DEFECTIVE MACHINES, INTEREST, AND COMPENSATION WAS JUST AND APPROPRIATE.
Headnote:
CONSUMER PROTECTION ACT, 1986 - DEFECTIVE MACHINERY - SECTION 2(1)(g) - THE COURT HELD THAT THE STATE COMMISSION'S ORDER DIRECTING THE RESPONDENT TO PAY THE PRICE OF DEFECTIVE MACHINES, INTEREST, AND COMPENSATION WAS JUST AND APPROPRIATE.
Fact of the Case:
THE APPELLANT, A DIPLOMA HOLDER IN AUTOMOBILE ENGINEERING, SET UP A SMALL-SCALE UNIT UNDER THE SELF-EMPLOYMENT SCHEME. HE PROCURED MACHINERY FROM THE RESPONDENTS, WHICH TURNED OUT TO BE DEFECTIVE. HE FILED A COMPLAINT BEFORE THE STATE COMMISSION, WHICH DIRECTED THE RESPONDENTS TO PAY THE COST OF THE MACHINES, INTEREST, AND COMPENSATION.
Finding of the Court:
THE COURT FOUND THAT THE MACHINERY WAS INDEED DEFECTIVE AND THAT THE STATE COMMISSION'S ORDER WAS JUST AND APPROPRIATE.
Issues: 1. WHETHER THERE IS PRIVITY OF CONTRACT BETWEEN THE COMPLAINANT AND OPPOSITE PARTIES? 2. WHETHER THE MACHINERY FOUND TO BE DEFECTIVE SHOULD BE REPLACED OR COST OF MACHINERY WITH INTEREST BE REFUNDED? 3. WHETHER THE COMPLAINANT WAS ENTITLED TO ANY COMPENSATION?
Ratio Decidendi: THE COURT HELD THAT THE STATE COMMISSION'S ORDER WAS JUST AND APPROPRIATE BECAUSE IT DIRECTED THE RESPONDENT TO PAY NOT ONLY THE PRICE OF DEFECTIVE MACHINES BUT ALSO 15% INTEREST FROM THE DATE OF COMPLAINT ALONG WITH COMPENSATION OF RS. 5,000.00.
Final Decision: THE COURT DISMISSED THE APPEAL WITH NO ORDER AS TO COSTS.
2.Briefly the facts of this case are that the appellant, who is a diploma holder in Automobile Engineering set up a small scale unit under the name and style of M/s. Jyoti Enterprises, Hyderabad under the self-employment scheme. His project was assisted by the National Small Industries Corporation Ltd. and the General Manager, District Industries Centre, Musheerabad. He procured the following machinery which was supplied by the National Small Industries Corporation Ltd. at the prices indicated :
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Sl. No.ParticularsQty.Sale ValueD.C. No.
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01.N.S.B. Lathe 6 feet 2 H.P.129,739.00425 to
Motor and Accessories427
02.Samson 1 M.T. 1" H.D. Radial114,380.00
Drilling Machine with 1 H.P.
Motor and Accessories
03.Hercules brand 300 amps.1 7,796.00 Dt. 27-9-1986
welding transformer
04.KIWI 0.5 H.P. Double ended1 1,862.00
Bench Cylinder.
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Total53,715.00
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This machinery was supplied to him through Engineers International. After the setting up of the workshop he found that two items namely the lathe 6 2H.P. Motor and Accessories and Radial Drilling Machine with 1 H.P. Motor and Accessories were defective and burnt out within three months. These could not be even repaired and ultimately, according to the appellant, he had to close his business suffering huge losses as neither the Engineers International nor the National Small Industries Corporation Ltd. or the General Manager, District Industries Centre, Musheerabad gave him any help. He, therefore, first filed a complaint before this Commission and on our advice as regards the valuation, he filed it before the State Commission, Andhra Pradesh at Hyderabad. The State Commission decided on the following issues on the basis of pleadings of both the parties :
(1) Whether there is privity of contract between the complainant and Opposite Parties ?
(2) Whether the machinery found to be defective should be replaced or cost of machinery with interest be refunded ?
(3) Whether the complainant was entitled to any compensation ?
The State Commission came to the conclusion that the lathe and radial drilling machine were indeed defective, and therefore, directed the Engineers International who are respondent before us to pay Rs. 44,119.00, the original cost of these machines, paid by the appellant back to him alongwith interest @ 15% per annum from the date of complaint i.e. 6-7-1990 and take back the dismantled parts of the machines. The respondents were also directed to pay Rs. 5,000.00 towards compensation.
3.It is against this order that Shri D.V. Vasudevarao has filed the appeal before us. His main contention is that the award given by the State Commission is totally inadequate in relation to the reliefs claimed and the losses sustained by him. He has claimed the following reliefs before the State Commission :-
(a) Directions to the respondents to take back the defective machines and refund the amount.
(b) To pay a sum of Rs. 2,08,165.00 towards the maintainance expenses incurred by him during the period the workshop did not function because of defective machinery.
(c) To pay business loss at the rate of Rs. 30,000.00 per annum and direct the National Small Industries Corporation Ltd., Madras and Hyderabad not to recover instalments of the loan till the consumer dispute is settled.
It has been argued before us that but for the defective machines the appellant w
