The provision of telephone facilities by the Telecommunication Department constitutes a service under the Consumer Protection Act, and aggrieved consumers can seek redressal before the special forums created under the Act, despite the existence of a remedy by way of arbitration under the Indian Telegraphs Act.

V. Balakrishna Eradi, President—This is an appeal filed against the order dated 1st August, 1988 passed by the State Commission of Bihar awarding to the Respondent herein-the Managing Director. State Warehousing Corporation, Patna - a sum of Rs. 5,000/- by way of compensation for the wrongful shifting of a telephone from his office to the residence of the Private Secretary to the Chairman of the said Corporation. It is unnecessary for us to narrate, in detail, the facts of the case since they have been set out in exten-so in the order of the State Commission.

2. After hearing both the sides, we do not find any valid grounds for disturbing the finding arrived at by the State Commission that in effecting the shifting of the telephone from the office of the Complainant to the residence of the Private Secretary to the Chairman, there was negligence on the part of the appellant herein and that it constituted a deficiency in the service rendered by the appellant Department to the consumer.

3. We have already held in Union of India v. Nilesh Agarwal that “in providing the telephone facility to subscriber on payment of installation charges, rental charges and call charges, the Telecommunication Department is rendering a service as defined in the Consumer Protection Act and the subscribers to telephones are consumers as defined in the Act.” We are not impressed with the contention taken on behalf of the appellant by the learned counsel Mr. Sanghi that by reason of Section 7(b) of the Indian Telegraphs Act which provides for arbitration, the remedy under the Consumer Protection Act cannot be invoked by the consumers. The existence of a remedy by way of arbitration, even assuming for purposes of discussion that Sec. 7(b) covers this case which, in our view, is extremely doubtful, does not preclude an aggrieved consumer from seeking redressal before the Forums constituted under Consumer Protection Act which is a special statute enacted by Parliament for the specific purpose of providing a speedy, cheap and efficacious remedy to consumers before the special forums created for that purpose. We have already indicated this view, though not finally, in our judgment passed by us in the aforementioned case. We hereby affirm that view as our considered opinion in respect of this matter. The ground of objection will, therefore, stand overruled.

4. The finding of the State Commission that there was deficiency on the part of the appellant in rendering the service to the Respondent having been, thus, affirmed by us, a question arises as to whether the State Commission was justified in awarding the sum of Rs. 5,000/- by way of compensation. As indicated by us in some of our earlier judgments, the award of compensation by the Forums established under the Act has to be made only on well recognised legal principles governing the quantification of damages or compensation. The compensation to be awarded has to be quantified on a rational basis on a consideration of materials produced before the Adjudicating Forums showing the extent of injury suffered and the manner in which and the extent to which monetary loss has been caused thereby to the complainant. There was absolutely no material before the State Commission showing the extent of loss or injury caused to the Corporation on account of the disconnection of the telephone for a short period. There was only a bald assertion that because of the disconnection of the telephone, the business of the Corporation had suffered. To what extent it had suffered or in what manner, particularly when there were two or three other telephones in the same office, has not been attempted to be shown to the State Commission by the Complainant. Unfortunately, there is no discussion in the order of the State Commission to disclose on what basis it has fixed the compensation at Rs. 5,000/-.

5. In the circumstances of this case, we are of opinion that the State Commission should have awarded only nominal damages and that the a