The main legal point established is that the Commissions under the Consumer Protection Act do not have the jurisdiction to refer disputes for consensual adjudication without explicit authorization under the Act.

1. All these Civil Appeals are being disposed of by this common order. It is clarified that at this stage this Court is not going into the facts of any case but is only dealing with the propriety of the procedure followed by the National Consumer Disputes Redressal Commission (hereinafter for sake of convenience called the ‘Commission’) in all these matters.

2. With the industrial revolution and development in the International Trade and Commerce, there has been a substantial increase of business and trade, which resulted in a variety of consumer goods appearing in the market to cater to the needs of the consumers. The modern method of advertisement in media, influence the mind of the consumers and notwithstanding the manufacturing defect or imperfection in the quality, a consumer is tempted to purchase the goods. There has been possibility of deficiency in the services rendered. For the welfare of such consumer and to protect the consumers from the exploitation to provide protection of the interest of the consumes, the Parliament enacted the Consumer Protection Act, and the Act itself makes provision for the establishment of Commissions for settlement of the consumer disputes and matters connected therewith. The Commissions, under the Act, are quasi judicial bodies and they are supposed to provide speedy and simple redressal to consumer disputes and for that purpose, they have been empowered to give relief of a specified nature and in an appropriate way, to award compensation. On a detailed scrutiny of the different provisions of the Act and bearing in mind the powers conferred on the Commissions, it is indeed difficult to conceive that such Commissions would be authorised to refer the disputes for a consensual adjudication, merely because to arrive at a decision, it would be necessary to take evidence in the proceedings. In the absence of any provision in the Act itself, authorising the Commission to refer a pending proceeding before it, on receipt of a complaint from a consumer, for being settled through a consensual adjudication, the conclusion is irresistible that the Commissions under the Consumer Protection Act do not have the jurisdiction to refer the dispute for a consensual adjudication and then make the said decision of the so-called consensual arbitrator, an order of the Commission itself. Even if there exists an arbitration clause in an agreement and a complaint is made by the consumer, in relation to certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal Agency, constituted under the Consumer Protection Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force. Now let us see what procedure has been adopted by the Commission.

3. In all these matters the Commission has passed orders referring the concerned matter to consensual adjudication by a retired Judge. For sake of convenience a typical order (as passed in Civil Appeal No. 2500 of 1994) is reproduced below :

“ORDER

After hearing both sides we suggested to parties that since evidence will have to be taken and the questions of facts determined after scrutiny of various documents and the oral evidence, it is best that both sides agree to the matter being adjudicated upon consensually by a retired Judge of the Supreme Court. Both parties have submitted before us that they are agreeable to the course suggested by us. Accordingly both sides consented before us that the dispute forming the subject matter of this Original Petition may be referred to Mr. Justice V.D. Tulzapurkar, retired Judge of the Supreme Court of India who is residing in Bombay. Both parties to this dispute have their offices in Bombay and so it would be convenient to have the adjudication conducted by a retired Judge who is in Bombay. The records of the case will be transmitted by the Registry to Mr. Justice V.D. Tulzapurkar at his address