DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)

Consumer Complaint No.293 of 2017

                                             Date of institution:  20.04.2017                                             Date of decision   :  16.02.2018

Harpreet son of Anil Kumar resident of House No.1738, Sector 80, Mohali.

…….Complainant

Vs

Adi Sports Pvt. Ltd., Adidas GF 001, FF 40, 41, 42, 43, 44 Cosmo Plaza NH-22, Mohali Zirakpur through its Manager or authorised representative.

……..Opposite Party

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:    Shri G.K. Dhir, President,

                Shri Amrinder Singh Sidhu, Member

                Mrs. Natasha Chopra, Member.

Present:     Complainant in person.

                Shri Manoj Lakhotia, counsel for the OP.

Order by :-  Shri G.K. Dhir, President.

Order

               Complainant, after visiting OP on 30.03.2017 purchased one product by paying Rs.212/- through retail invoice of that date. MRP of the product inclusive of all taxes was Rs.399/-. Discount of 50% on the MRP was offered. After such discount, price of the product was Rs.199.50 N.P. inclusive of all taxes. However, OP charged VAT of amount of Rs.12.07 N.P. @ 6.05% on the discounted price and that is an unfair trade practice adopted by OP due to which complainant suffered physical and mental harassment as well as agony. So complaint filed for seeking refund of excess paid amount of Rs.12.07 N.P. alongwith compensation for mental and physical harassment of  Rs.25,000/- and litigation expenses of Rs.15,000/-.

2.             In reply, it is claimed that jurisdiction of this Forum erroneously invoked and complaint being based on vague and baseless assumptions merits dismissal. Complaint also alleged to be not disclosing any cause of action. Issue of charging VAT on discounted price is already sub judice before Hon’ble Supreme Court of India in Special Leave Petition 8868 of 2017 titled as M/s. Aero Club (Woodland) Vs. Rakesh Sharma. Special Leave Petition in that respect has been admitted by Hon’ble Supreme Court vide order dated 31.03.2017 and as such prayer made for adjourning the proceedings of this complaint sine die. Admittedly, OP is carrying on business of sale, distribution and marketing of Reebok brand sports and lifestyle goods for which it has acquired reputation.  Complainant alleged to have approached this Forum with unclean hands by suppressing material facts. Complainant failed to disclose the facts regarding invitation of offer of discount alongwith terms and conditions, on which the discount offer can be availed. No unfair trade practice adopted by OP and nor it violated provisions of any law in charging VAT as extra on the discounted price. Complainant himself accepted the terms and conditions of OP while paying sale consideration amount without protest. Complainant was made well aware regarding terms and conditions of applying VAT extra on the discounted price and as such now complainant estopped  by his act and conduct from filing this complaint. Present complaint contains afterthought versions and the same is filed with intention of harassing OP. Other allegations of complaint regarding charging of extra VAT tax amount of Rs.12.07 N.P. denied but by admitting that discount of 50% on MRP was offered. VAT alleged to be levied as per rules and regulations.

3.             Complainant to prove his case tendered in evidence his affidavit Ex.CW-1/1 alongwith original bill and tag Ex.C-1 and C-2 and thereafter closed evidence.  On the other hand, counsel for the OP tendered in evidence affidavit Ex.OP-1/1 of Shri Gurpreet Mann alongwith document Ex.OP-1 and Ex.OP-2 and thereafter closed evidence.

4.             Written arguments not submitted by any of the parties. Oral arguments heard and records gone through.

5.             From the pleadings of the parties and the submitted evidence as well as contents of invoice Ex.C-1 and tag Ex.C-2, it is made out that MRP of the purchased product was Rs.399/- inclusive of all taxes. After giving discount, an amount of Rs.199.50 N.P. was the discounted price, but VAT amount of Rs.12.07 N.P. @ 6.05%, was additionally charged. ROD of 0.43 even was charged. Total paid amount by complainant through invoice Ex.C-1 was Rs.212/- . So from this, it is obvious that complainant despite getting discount offer, had to pay the VAT amount in addition to the discounted price amount. This is despite the fact that MRP of Rs.399/- includes all taxes. That certainly is an unfair trade practice as per law laid down by Hon’ble National Commission and Hon’ble State Commission. In holding this view, we are fortified by law laid down by Hon’ble National Commission in case titled as M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma bearing Revision Petition No.3477 of 2016 decided on 04.01.2017. Similar view also taken by Hon’ble State Consumer Disputes Redressal Commission, UT Chandigarh in its judgment dated 23.05.2017 titled as M/s Aero Club Vs. Ravinder Singh Dhanju bearing First Appeal No.136 of 2017. After going through ratio of these cases, it is made out that when MRP includes all taxes, then VAT/other taxes cannot be charged separately, meaning thereby that after discount, no VAT can be charged. Ratio of both these cases lays that on discounted price of the product, VAT cannot be charged and as such certainly practice of charging VAT on discounted price, is unfair trade practice.  The same practice followed by OP in this case by charging VAT on the discounted price and as such certainly complainant entitled to refund of excess charged amount of Rs.12.07 N.P. with interest @ 6% per annum w.e.f. the date of  purchase namely 30.03.2017 till realisation. On account of above said act of charging VAT illegally, complainant suffered mental agony and harassment and was dragged in litigation and as such he is entitled to compensation as well as litigation expenses.

6.             Learned counsel for the OP vehemently contends that as order dated 04.01.2017 passed by the Hon’ble National Commission in case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra)  has been challenged before the Hon’ble Supreme Court and as the Hon’ble Supreme Court has admitted the Special Leave Petition, as disclosed by contents of Ex.OP-1, and as such benefit from ratio of cases  of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) and M/s Aero Club Vs. Ravinder Singh Dhanju (supra)  referred above, cannot be got by the complainant. That submission of counsel for OP has no force because it is well settled that bare filing of Special Leave Petition or admission thereof, will not tantamount to staying of operation of orders of Hon’ble National Commission. The ratio of above quoted case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) of Hon’ble National Commission is binding on this Forum and as such the same has to be followed, in abeyance to the orders passed by any other District Forum or Hon’ble State Commission. Provisions of Order 41 Rule 5 of CPC also provide that mere filing of appeal does not amount to stay of operation of orders under challenge in appeal. Upon the same analogy, it has to be held that even if Special Leave Petition through Ex.OP-1 may have been admitted by Hon’ble Supreme Court, despite that inference of stay of operation of law laid down by Hon’ble National Commission in case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) cannot be drawn.

7.             The complainant vehemently contends that exemplary costs of more than Rs.10,000/- should be allowed, so that such practice may not be followed in future by OP. However, law prohibits unjust enrichment. After going through Para No.4 of case titled as M/s Aero Club Vs. Ravinder Singh Dhanju (supra) it is made out that in  the reported case also, Ld. District Forum allowed compensation for physical and mental harassment of Rs.2,000/- but litigation expenses of Rs.1,000/-.  Those amounts not enhanced in appeal even. VAT charged in the case before us is not too much and as such allowing of compensation for mental harassment and agony of Rs.2,000/- and litigation expenses of Rs.2,000/- more against OP is justified because these amounts are reasonable by keeping in view monetary sufferings of the complainant, more so when interest @ 6% per annum also allowed on the excess charged amount.

8.             As a sequel of above discussion, the complaint is allowed with direction to OP to refund excess charged amount of Rs.12.07 N.P. with interest @ 6% per annum w.e.f. 30.03.2017 till payment. Compensation for mental agony and harassment of Rs.2,000/- and litigation expenses of Rs.2,000/- more allowed in favour of complainant and against  OP.  Payment of amount of compensation and litigation expenses be made within 30 days from the date of receipt of certified copy of the order.

                Since there is shortage of postal stamps in this Forum, therefore, the parties through their counsel are directed to receive free certified copy of the order by hand and it will be the responsibility of the learned counsel for the parties to inform them accordingly.  This direction issued by following the principle laid down by Hon’ble  Punjab State Consumer Disputes Redressal Commission, Chandigarh in Consumer Complaint No.956 of 2017 titled as Partap Rai Sharma Vs. Greater Mohali Area Development Authority (GMADA), decided on 25.01.2018. File be indexed and consigned to record room.

Announced

February 16, 2018.

                                                                (G.K. Dhir)

                                                                President

                                                     (Amrinder Singh Sidhu)                                                                 Member

(Mrs. Natasha Chopra)

Member