SupremeToday Landscape Ad
Back
Next
Judicial Analysis Court Copy Headnote Facts Arguments Court observation
Listen Audio Icon Pause Audio Icon
judgment-img

KERALA STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, THIRUVANANTHAPURAM
Mr. Justice L. Manoharan, President &
Prof. K. Madhuri Latha, Member
B. JAYAKUMAR—Complainant
versus
BHARATH EARTH MOVERS LIMITED—Opposite Party
O.P. No. 82 of 1997—Decided on 8.9.1998

Advocates:
Counsel for the Parties :
For the Complainant :Mr. Varghese M. Mathew, Advocate.
For the Opposite Party :Mr. V.K. Mohankumar, Advocate.

Headnote:

CONSUMER PROTECTION ACT - PURCHASE OF EQUIPMENT FOR COMMERCIAL PURPOSE - WHETHER THE COMPLAINANT IS A CONSUMER - WHETHER THE EQUIPMENT SUFFERS FROM MANUFACTURING DEFECT - WHETHER THE COMPLAINANT IS ENTITLED TO COMPENSATION CLAIMED.

Fact of the Case:

The complainant purchased a Backhoe Loader from the opposite party for commercial purposes. The complainant alleged that the equipment suffered from manufacturing defects and sought compensation for the loss incurred due to the non-functioning of the equipment. The opposite party contended that the complainant was not a consumer as the purchase was for commercial purposes and that the equipment did not suffer from any manufacturing defects.

Finding of the Court:

The court held that the complainant was not a consumer as the purchase was for commercial purposes. However, the court held that the complainant could be treated as a consumer for the purpose of service during the warranty period. The court further held that the complainant failed to prove that the equipment suffered from manufacturing defects. The court also held that the complainant failed to prove the loss incurred due to the non-functioning of the equipment.

Issues: 1. Whether the complainant is a consumer? 2. Whether the equipment suffers from manufacturing defects? 3. Whether the complainant is entitled to compensation claimed?

Ratio Decidendi: 1. A person who purchases goods for commercial purposes is not a consumer under Section 2(1)(d) of the Consumer Protection Act, 1986. 2. Even if the purchase is for commercial purposes, the purchaser can be treated as a consumer for the purpose of service during the warranty period under Section 2(1)(d)(ii) of the Consumer Protection Act, 1986. 3. The burden of proof is on the complainant to prove that the goods suffer from manufacturing defects. 4. The complainant cannot be awarded compensation without proving the loss incurred due to the non-functioning of the equipment.

Final Decision: The complaint was dismissed.

ORDER

Mr. Justice L. Manoharan, President— This complaint under Section 17 of the Consumer Protection Act, 1986 (for short 'the Act') is for a direction for payment of Rs. 20 lakhs as compensation. The allegations in brief are; on 8.8.1995 the opposite party placed an invoice with the complainant offering the sale of a Backhoe Loader needed for the purpose of bulk movement of earth for total consideration of Rs. 14,57,500/- inclusive of tax. The ex-factory price of the equipment is Rs. 12,50,000/-, that was accepted by the complainant at Kalady in Ernakulam District. The opposite party thereupon sent the equipment on 31.10.1995 and the sale certificate was issued on 9.11.1995; and on 16.11.1995 the Shipping Officer of the opposite party at Bangalore prepared the invoice for the removal of the equipment to Kalady. Warranty Card for the same was also handed over to the complainant. On 22.11.1995 a representative of the opposite party deputed by the Kochi Office of the opposite party inspected the equipment at Kalady and issued the delivery inspection report. Thereafter on 1.12.1995 it was found that the Back Hoe of equipment was not working properly and hence the mobile control value assembly of the equipment had to be replaced. There was oil leaking on 4.12.1995 and it was inspected, the control value was found tilted; thereupon the Rotary Activator Assembly was replaced. Though repairs were attended, it was noticed that, the problem cannot be rectified at the site and therefore it had to be removed to Bangalore Head Office and accordingly it was sent to Bangalore on 12.1.1996. The opposite party replaced the engine and the transmission system of the equipment and it was delivered back at Kaladi on 3.2.1996. The equipment was found to be working effectively. On 9.2.1996 it showed Hydraulic oil leakage and that was rectified. On 26.2.1996 it was found that certain defects like swing did not stop and that too was rectified by the opposite party's Engineers. On 16.3.1996 though there was oil leakage the machine was working. On 27.3.1996 it was found the machine had developed leakage of oil. On 11.9.1996 repairs were attended and 14 items were replaced. But on 3.10.1996 the hydraulic oil leakage repeated and upon that the complainant wanted the warranty period of the equipment extended. Warranty period was extended for 1 year or 1500 hours of operation of the equipment whichever is earlier. On 24.12.1996 oil leakage was noticed. That was rectified. Later, though rectified the problem again repeated. On 7.9.1997 the operation of the machine became slow. On 12.12.1997 the condition of the equipment continued with the aforesaid problem. The complainant alleged that, he had invested Rs. 5 lakhs for acquiring the equipment and raised the balance Rs. 9,50,000/- by hire purchase. He expected the equipment to work for a minimum of 9 hours a day, but during the course of 2 years after supply of the machine it worked only for 2500 hours of which productive part was only 2000 hours. The equipment requires an operator, an assistant operator and also a helper, their wages also had to be paid. There was facility to work for 10 months in a year at the rate of 9 hours a day, but because of frequent failures of the machine the output was only 2500 hours as against the anticipated 5400 hours. Thus towards the earning, the complainant incurred a net loss of Rs. 11,91,000/-. An amount of Rs. 9,60,000/- is outstanding towards balance of hire purchase of the equipment. Thus the complainant has incurred a total loss of Rs. 33,06,000/-. It is also alleged that, later in the afternoon of 18.12.1997 the Manaspuram General Finance and Leasing Limited, Naikanal, Thrussur, who had advanced finance for the purchase of the equipment seized the equipment from the complainant's custody and taken it into their possession. The aforesaid series of non-functioning would constitute "defect" under the Consumer Protection Act. Complainant therefore alleged that, there is








































Click Here to Read the rest of this document

1
2
3
4
5
6
7
8
9
10
11
Judicial Analysis

AI

SupremeToday Portrait Ad
supreme today icon
logo-black

An indispensable Tool for Legal Professionals, Endorsed by Various High Court and Judicial Officers

Please visit our Training & Support
Center or Contact Us for assistance

qr

Scan Me!

India’s Legal research and Law Firm App, Download now!

For Daily Legal Updates, Join us on :

whatsapp-icon Back to top