Employees and their family members entitled to free-medical treatment as per their service conditions can be considered as consumers under the Consumer Protection Act.

Dr. P.D. Shenoy, Member—The short point to be decided in this case is whether an employee and his family members of Visakhapatnam Port Trust who are entitled to receive free-medical treatment as per their service conditions can be considered as consumers under Consumer Protection Act. The simple answer is yes.

2. The complainant No. 1 Shri G. Kondala Rao, an employee of Visakhapatnam Port Trust claimed compensation for medical negligence and deficiency in service due to the action and inaction of the first and second opposite parties which led to the death of his wife. Complainant’s wife was treated at the dispensary and hospital run by the Visakhapatnam Port Trust and also at King George Hospital and the latter had charged Rs. 118 towards H.S. Charges. The District Forum held as follows:

“The service rendered by both the hospitals is under the contract for service. Service under the contract of personal service is excluded from the deficiency of service. Hence, it is not a consumer dispute. Complainant, if so advised, has to approach the Civil Court for claiming compensation under tortious liability. Hence, return the complaint for representing in the Civil Court having jurisdiction.”

3. Aggrieved by the order of District Forum the complainant had filed, an appeal before the State Commission. The State Commission confirmed the order of District Forum.

4. It is not in dispute that complainant No. 1 is an employee of Visakhapatnam Port Trust and provision of medical service to an employee free of cost or at nominal cost was a part of service conditions.

5. Extract from the judgment of the Apex Court in Laxman Thamappa Kotagari v. B.R. Ambedkar Hospital run by the Indian Railways, 2005 (1) Scale 600 is quoted below in extenso:

“The appellants is an employee of the Railways. On the ground that his wife had been negligently treated in the B.R. Ambedkar Hospital of the Central Railway (referred to as ‘the Hospital’) as a result of which she died, he filed a complaint under the Consumer Protection Act, 1986 (hereinafter referred as ‘the Act’) before the State Commission came to the conclusion that the hospital had been set up to treat railway employees and the ‘predominant component’ of the Railway Hospital was free service to the railway employees and not paid service to outsiders. The charges taken from the railway employees were nominal and were with reference to the maintenance charges of the Hospital. Relying upon the decision of this Court in Indian Medical Association v. V.P. Shantha, III (1995) CPJ 1 (SC)=1995 (6) SCC 651, the State Commission came to the conclusion that event if these charges were taken into consideration the services rendered at the Railway Hospital would not come within the definition of ‘paid service’ for the purpose of the Consumer Protection Act, 1986 and, therefore, the complaint of the appellant was not maintainable. The National Commission upheld this view and rejected the appeal preferred by the appellant.

The appellant has submitted that the decision of the Commission was erroneous as it proceeded on a misunderstanding of the scope of the decision of this Court in V.P. Shantha’s case (supra). It is submitted that V.P. Shantha’s case was a clear authority for the proposition that where medical service was rendered as part of the terms and conditions of service this would not amount to free service and would constitute service for the purpose of the Act.

Since it is not in dispute that the medical treatment in the said Hospital is given to employees like the appellant and his family members is part of the conditions of service of the appellant and that the Hospital is run and subsidized by the appellants employer, namely, the Union of India, the appellant’s case would fall within the parameters laid down in paragraph 55(12) of the judgment in V.P. Shantha’s case and not within the parameters of either para 55(6) or para 55(9) of the said case.

It is true that the decision in State of Orissa v. Divisiona