Judicial Analysis Court Copy Headnote Facts Arguments Court observation

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Subhash Chandra, Presiding Member and
AVM J. Rajendra, AVSM VSM (Retd.), Member
M/s Idmc Ltd. – Complainant
versus
M/s Ernst & Young Llp and Ors. – Opp. Parties
Consumer Complaint No.820 of 2016 with
IA/216/2023 (Deletion of Parties), IA/3477/2024 (Condonation of Delay), IA/9651/2016
(Dismissal of complaint)
Decided on 9.5.2025

Counsel for the Parties:
For the Complainant:Mr. Anil Kher, Sr. Advocate, Mr. Sanjay Sharma, Mr. Mohit Giri, Advocates
For the Opp. Parties:Mr. Koshy John, Ms. Ravneet Kaur Malik Advocates

IMPORTANT POINT
Consumer complaint—Maintainability—Primary determinant for categorizing an entity as a ‘consumer’ is nature of transaction rather than identity or status of entity itself—If a transaction involves purchase of goods or services for personal use, entity making purchase can be considered a ‘consumer,’ regardless of whether they are an individual or a company.

Headnote:
Consumer Protection Act, 1986 – Section 2(1)(d) [Consumer Protection Act, 2019 – Section 2(7)] – Consumer complaint – Maintainability – Commercial purpose – Service Contract – Breach of confidentiality – Primary determinant for categorizing an entity as a ‘consumer’ is nature of transaction rather than identity or status of entity itself – If a transaction involves purchase of goods or services for personal use, entity making purchase can be considered a ‘consumer,’ regardless of whether they are an individual or a company – Complainant is a large commercial entity and scope of contract in question between parties is inherently for enhancing viability and profitability – Complainant does not constitute a Consumer under Consumer Protection Act, 1986 – Consumer complaint dismissed – Complainant granted liberty to invoke jurisdiction of appropriate forum to advance their grievances. (Paras 12, 13 and 14)
Result: Consumer Complaint dismissed.

JUDGMENT

AVM J. Rajendra, AVSM VSM (Retd.), Member—The present Consumer Complaint has been filed under Section 21(a)(i)of the Consumer Protection Act, 1986 (for short “the Act’) against the Opposite Party seeking to direct the OPs:—

(i) Allow the instant Complaint filed by the Complainant.;

(ii) Pass an order holding the Opposite Parties 1 to 4 jointly and severally liable for the deficiency in providing service to the Complainant;

(iii) Pass an order directing the OPs to jointly and/ or severally forthwith remit to the Complainant a sum of Rs.1,59,55,000/- towards the refund of the amount paid by the Complainant to the OPs;

(iv) Pass an order directing the OPs to jointly and/ or severally forthwith remit to the Complainant a sum of Rs.1,00,00,000 towards compensation for the grave inconvenience and agony and loss of management time suffered by the Complainant;

(v) Pass an order imposing an interest at the rate of 18% per annum on the total sum prayed above from the date of this complaint till its realization;

(vi) Pass an order awarding cost of the present proceedings in favour of the Complainant and against the OP;

(vii) Pass such other or further order or orders, direction or directions as may be considered fit and expedient in the interest of justice;

2. Brief facts of the case, as per the complainant, is that the Complainant and OP-1 to 3 have entered into an agreement and a Statement of Work (“the SoW’) wherein the office bearers and representatives of OP-1 agreed to provide support for implementing the recommendations for sustainable growth to the Complainant under the project name ‘Aarohan’ (“the Project’). The scope of work covered under the said SoW, as duly agreed between the Complainant and OPs, comprised four modules, namely: (i) Support for strategy implementation; (ii) Support for operations improvement and cost reduction; (iii) Support for implementation of HR recommendations; and (iv) Compliance Management. The said SoW contained details relating to the services agreed to be provided by the OPs to the Complainant and was duly supplemented by General Terms and Conditions (“the T&C’), which were also agreed between the parties. These, inter-alia, enumerated the terms and conditions regarding mutual relationship and responsibilities of the contracting parties and terms related to confidentiality and data protection. It was agreed with reference to Section 25 of the T&C that neither of the parties may disclose to third parties the contents of this Agreement or information, except tax advice, provided by or on behalf of the other that ought reasonably to be treated as confidential and/or proprietary. It was further undertaken under Section 29 of the T&C, that OPs shall process personal data forming part of the information shared by the complainant as per the applicable law and professional regulations. The Complainant acted on the representation of OPs that they strive to keep in place the most effective data security practices and safeguard confidentiality with utmost seriousness. The Global Code of Conduct followed by OPs declares as follows: “We respect and protect confidential information obtained from, or relating to, our clients or third parties, as well as personal information about our people, in accordance with local law and professional standards.’ Despite making stout claims regarding the services offered by the OPs, backed by robust practices to safeguard confidential client information, OP-1 and its office bearers/representatives acted in an utter negligent and callous manner while handling complainant’s critical data/information, exposing its interests to severe and perpetual risk. During the course of engagement of OPs with the Complainant, a designated employee/ representative of OPs Mr. Shashank Rastogi, Senior Manager, IIC Performance Improvement, in an Email dated 27.02.2015, which was shockingly sent from his personal Email ID (shashankr@gmail.com), communicated a chain of Emails w