Judicial Analysis Court Copy Headnote Facts Arguments Court observation

2025 Supreme(Online)(NCDRC) 2547

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
A. P. Sahi, CJ, Bharatkumar Pandya, J
H.G. Jain – Appellant
Versus
Volkswagen India Pvt. Ltd. – Respondent
Consumer Complaint No. NC/CC/284/2015

Advocates:
For the Complainant:MR. PRASOUK JAIN, ADVOCATE, MR. ANURAG SHARMA, ADVOCATE
For the Opposite Party:MS. EKTA BHASIN, ADVOCATE, MR. SANIDHYA SONTHALIA, ADVOCATE FOR OP-1, MR. R. GOPALAKRISHNAN, ADVOCATE FOR OP-2

Manufacturers are liable for defects in products sold, and consumers are entitled to compensation for deficiencies in service, ensuring that the product functions as expected.

Headnote:(A) Consumer Protection Act, 2019 - Sections 2(1)(d), 14 - Allegation of deficiency in service regarding defects in a luxury car - Complaint arises from performance and mechanical issues of vehicle 'Phaeton' purchased for Rs.90,80,592/- - Defects reported such as navigation failure and water leakage damaging ECM unit - Opposite Parties failed to respond adequately, leading to consumer dissatisfaction - Case involves unlawful trade practices. (Paras 1-4, 10, 54)

(B) Defect and Deficiency - 'Defect' defined under the Act, involves fault or imperfection affecting quality or purpose - Manufacturer’s responsibility extends to ensuring product performance - Service, despite warranty efforts, deemed ineffective. (Paras 12.2-12.3, 52)

(C) Damages - Consumers entitled to compensation for persistent defects; the absence of replacement options factored in the liability - Award of Rs.10,00,000/- granted for the harassment endured. (Paras 54, 55)

Facts of the case:
The Complainant purchased a 'Phaeton' luxury vehicle by Volkswagen on 27.04.2011. Complaints of performance issues and factory defects arose between 2014 and 2015, including water leakage and failure of electronic systems. The complaint had been filed following poor responses from the Opposite Parties regarding repair and service deficiencies.

Findings of Court:
The vehicle presented multiple defects within a short period since purchase, and the repairs attempted by Opposite Parties failed to resolve the issues. The court concluded that the complainant is entitled to full damages for ongoing defects and service failures.

Issues: The central issues addressed involve whether the vehicle was sold as an old stock with undisclosed defects, the adequacy of service provided, and the resultant damages to the complainant.

Ratio Decidendi: The court emphasized that continuous defects led to deficiency in service under the Act; consumer expectations were not met due to the brand's failure in providing an adequately functioning product, culminating in the award for damages.

Result: Complaint allowed; an award of Rs.10,00,000/- is granted.

Table of Content
1. initial description of the complaint and parties. (Para 1 , 2 , 3)
2. allegations regarding vehicle defects and responses from parties. (Para 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12 , 13)
3. court's observations on the arguments and evidence presented. (Para 14 , 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22 , 23 , 24)
4. consideration of the principle of caveat emptor and buyer's responsibilities. (Para 25 , 26 , 27 , 28 , 29 , 30 , 31 , 32)
5. assessment of alleged manufacturing defects and the necessity of expert opinion. (Para 33 , 34 , 35 , 36 , 37 , 38 , 39 , 40 , 41)
6. determining liability and repair obligations of manufacturers and dealers. (Para 42 , 43 , 44 , 45 , 46 , 47 , 48)
7. final observations on the defects and decision basis. (Para 49 , 50 , 51 , 52 , 53 , 54)
8. entitlement to compensation due to persistent defects. (Para 55)

ORDER

A.P. Sahi, J. (President)

1. This Complaint arises out of an allegation of deficiency in service against the Opposite Parties regarding the defects in a luxury car purchased by the Complainant manufactured by Volkswagen and purchased by the Complainant from the dealer M/s B. U. Bhandari Automotive Pvt. Ltd. Opposite Party No. 3 herein. The Complaint was filed on 17.04.2015 in which notices were issued on 01.05.2015. The Complaint originally designed had four Opposite Parties namely 1. Volkswagen A.G. (Volkswagen Aktiengesellschaft); 2. Volkswagen India Pvt. Ltd.; 3. Volkswagen Group Sales India Pvt. Ltd. and 4. B. U. Bhandari Automotive Pvt. Ltd. The original Opposite Party No. 1 situated at Germany was sought to be served through the Ministry of Law and Justice. This exercise of service continued for long and ultimately the Complainant moved an Application for deleting the Opposite Party No. 1 through IA/1194/2022 that was allowed on 17.02.2022. Consequently, Opposite Party No. 1 was struck off from the array of parties.

2. Of the remaining three, the original Opposite Party No. 2 and 3, now Opposite Party No. 1 and 2 were served but in spite of service of notice they failed to file their written version within time and consequently their right to file a written version was rejected on 14.10.2015. RA/275/2015 was filed seeking review of the said Order which was also rejected on 14.12.2015. The said Opposite Parties approached the Apex Court by filing special leave to Appeal No. 35031 of 2015 that was dismissed on 04.01.2016. Consequently, the said Opposite Parties had their right to file written version forfeited but they have appeared through their counsel and who have advanced their arguments in support of the legal contentions raised by them.

3. The present Opposite Parties No. 1 and 2 underwent a legal change of entity under a scheme approved by the NCLT Mumbai vide Order dated 05.09.2019. A copy of the said Order was placed on record through IA No. 17119 of 2024 filed on 27.11.2024 vide a Diary No. 39044. The said Application has been allowed on 02.12.2024 by us whereafter the orders were reserved. Consequently, with a change of entity as above the amended Memo has been filed and the same is on record. According to the amended Memo the dealer is now the Opposite Party No. 3. It may be pointed out that the dealer who was originally the Opposite Party No. 4 has filed his reply on 02.02.2016 vide Diary No. 5064. The said reply is the only written version which is on record regarding the allegations made in the Complaint. Since that is the only reply on Record, the same has been taken into consideration along with the documents filed along with the said reply. A reply was filed to the said response and the matter has been heard accordingly.

4. The grievance of the Complainant is that from the date of purchase the Complainant was disappointed by the performance of the vehicle which is a product named “Phaeton”. The Complainant alleges that the said version of the vehicle that were produced very few in number were claimed by the manufacturers to be of the same level of cars as Bentle

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2025 Supreme(Online)(NCDRC) 2547

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSIONA. P. Sahi, CJ, Bharatkumar Pandya, JH.G. Jain – AppellantVersusVolkswagen India Pvt. Ltd. – RespondentConsumer Complaint No. NC/CC/284/2015

Manufacturers are liable for defects in products sold, and consumers are entitled to compensation for deficiencies in service, ensuring that the product functions as expected.

Cases Referred (3)

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION
A. P. Sahi, CJ, Bharatkumar Pandya, J
H.G. Jain – Appellant
Versus
Volkswagen India Pvt. Ltd. – Respondent
Consumer Complaint No. NC/CC/284/2015