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

Consumer Complaint No.648 of 2017

                                                Date of institution:  28.08.2017                                             Date of decision   :  09.08.2018

Sanjeev Gupta son of Ramesh Chander, # 617, Sector-2, Panchkula.

…….Complainant

Versus

1.     The Manager, Adi Sports India Pvt. Ltd.  Ground Floor-001, First Floor 40, 41, 42, 43, 44, Cosmo Plaza, NH-22, Zirakpur-140603, Mohali.

2.     The Director, Adi Sports India Pvt. Ltd.  Ground Floor-001, First Floor 40, 41, 42, 43, 44, Cosmo Plaza, NH-22, Zirakpur-140603, Mohali.

3.     The Managing Director/Chairman, Adidas India Marketing Pvt. Ltd. (Corporate Office), Plot No.53, Sector 32, Gurugram-122001 (Haryana).

4.     The Manager, Adidas India Marketing Pvt. Ltd. (Corporate Office) Plot No.53, Sector 32, Gurugram-122001 (Haryana).

                                                            ……..Opposite Parties

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:    Shri G.K. Dhir, President,

                Shri Amrinder Singh Sidhu, Member.

Present:     Shri Vineet Mittal, counsel for complainant.

                Shri Manoj Lakhotia, counsel for the OPs.

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

Order

               Complainant after visiting show room of OPs on 28.03.2017, purchased one pair of shoes having MRP of Rs.4,299/-, but after giving discount, the discounted price was Rs.2,149.50 N.P. inclusive of all taxes. MRP of socks purchased was Rs.699/- and after giving discount, discounted price was Rs.349.50 N.P. inclusive of all taxes. MRP of shorts purchased was Rs.1,599/- and after giving discount, discounted price was Rs.799.50 N.P. inclusive of all taxes. Likewise MRP of purchased cap was Rs.1,199/- and after giving discount, discounted price was Rs.599.50 N.P. inclusive of all taxes. MRP of purchased shorts was Rs.1,699/- and after giving discount, discounted price was Rs.849.50 N.P. inclusive of all taxes. Likewise MRP of purchased T-shirt was Rs.1,299/- and after giving discount, discounted price was Rs.649.50 N.P. inclusive of all taxes. MRP of purchased shorts was Rs.1,999/- and after giving discount, discounted price was Rs.999.50 N.P. inclusive of all taxes. After discount @ 50%, total amount  to be paid was Rs.6,396.50  N.P. of the purchased items having total MRP of Rs. 12,793/-. However, OP charged Rs.6,961/-  from complainant, despite the fact that discounted price payable was Rs.6,396.50 N.P. In this way amount of Rs.565/- charged excess as VAT by adopting unfair trade practice and that is why this complaint for seeking refund of the excess charged VAT amount of Rs.565/- with interest @ 18% per annum from the date of purchase namely 28.03.2017 till payment. Compensation for mental agony and harassment of Rs.1,50,000/- and litigation expenses of Rs.20,000/- more claimed.

2.             In joint reply submitted on behalf of OP No.1 to 4, it is claimed that complainant is not consumer of OPs and as such complaint not maintainable. Besides, it is claimed that complaint is vague, baseless and filed with misconceived notion without any cause of action. So prayer made for dismissal of complaint in limine. Moreover, it is claimed that matter regarding charging of VAT on the discounted price is under consideration of Hon’ble Supreme Court of India in Special Leave Petition No.8868 of 2017 titled as M/s. Aero Club (Woodland) Vs. Rakesh Sharma. OPs have acquired good market reputation for its range of products, but the present complaint alleged to be filed by suppressing material facts. Complainant has not disclosed the fact that invitation to offer discount was subject to terms and conditions. Complainant after due application of mind and accepting terms and conditions of purchase bill, paid the consideration amount without protest. As the shoes were sold to complainant after completing chain of events forming contract and as such now complainant estopped from filing the complaint, more so when the same alleged to be filed just for harassing OPs for having illegal gain. Like products are ordinarily sold at discounted price in the market with VAT extra on the discounted price. So offer of discount was consistent with the market practice. It is also claimed in the reply that complainant purchased the T-shirt from OP No.1 having MRP of Rs.1,099/- on which discount of 50% was offered. It is claimed that alleged VAT of Rs.33.24 N.P. has been levied as per law on the sale price (It may be observed here that quoted MRP and the amount of VAT in this written reply is erroneously mentioned). It is claimed that VAT was rightly levied as per provisions of VAT Act of Punjab and Haryana, 2003. Sale price as per provisions of this Act means the amount payable to a dealer as consideration for sale of any goods less any sum allowed at the time of sale. At no point of time, OPs declared that flat rate of discount will be given on MRP of the product. Discount is always given on MRP, but VAT is always charged extra over the discounted sale price. Other averments of the complaint denied.

3.             Complainant to prove his case tendered in evidence his affidavit Ex.CW-1/1 alongwith document Ex.C-1 and Ex.C-2 and thereafter closed evidence. On the other hand counsel for OPs tendered affidavit Ex.OP-1/1 of Shri Gurpreet Mann, authorised signatory alongwith documents Mark-A  and thereafter closed evidence. 

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

5.             Perusal invoice Ex.C-2, legible copy of which subsequently produced on file on 09.08.2018, shows that amount of Rs.6,396.50 N.P. was payable after discount on all the purchased items referred above, but OPs charged Rs.6,961/- including taxes @ 14.3% or 6.05% as mentioned in Ex.C-2. So it is obvious that amount of Rs.564.50 N.P. has been charged as tax extra on the payable discounted price of Rs.6,396.50 N.P. That charging of taxes on the discounted price of products having MRP inclusive of all taxes is the one as  is certainly unfair trade practice. Tags numbering 7 produced as Ex.C-1 for showing MRP of the purchased products inclusive of all taxes, as referred in the complaint.  As MRP was inclusive of all taxes and as such taxes on the discounted price could not have been charged because the act of charging   tax on the discounted price has been held unfair trade practice by Hon’ble National Consumer Disputes Redressal Commission, New Delhi  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 as well as in case bearing First Appeal No.136 of 2017 titled as M/s Aero Club Vs. Ravinder Singh Dhanju decided on 23.05.2017 by Hon’ble State Consumer Disputes Redressal Commission, UT Chandigarh.  Ratio of both these cases fully applicable to the facts of the present case. No law to the contrary produced except that judgment in case of M/s. Aero Club (Woodland) Vs. Rakesh Sharma (supra) has been challenged in Hon’ble Supreme Court by way of filing Special Leave Petition No.8868 of 2017.  Perusal of Mark-A shows leave granted, but no stay granted. Provisions of Order 41 Rule 5 CPC provide that mere filing of appeal does not amount to stay of operation of order under challenge in appeal. On the same analogy, it has to be held that the operation of order of Hon’ble National Commission passed in M/s. Aero Club (Woodland) Vs. Rakesh Sharma (supra) has not been stayed till date. Being so, that order passed by the highest authority under the Consumer Protection Act, 1986, has to be followed by this Forum, being subordinate to the Hon’ble National Commission. So, virtually charging of VAT amount extra is an act of unfair trade practice, which had been deprecated by the Hon’ble National Commission in above cited case.

6.             As a sequel of above discussion, the complaint is allowed with direction to OPs to refund excess charged amount of Rs.564.50 N.P. with interest @ 6% per annum w.e.f. 28.03.2017 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  OPs.  Payment of amount of compensation and litigation expenses be made within 30 days from the date of receipt of certified copy of the order. Certified copies be supplied to the parties as per rules.  File be indexed and consigned to record room.

Announced

August 09, 2018.

                                                                (G.K. Dhir)

                                                                President

                                                       (Amrinder Singh Sidhu)

Member