DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)
Consumer Complaint No.230 of 2018
Date of institution: 21.02.2018 Date of decision : 15.11.2018
Brijesh Khosla son of N.K. Khosla, resident of Kothi No.382, Sector 30-A, Chandigarh- 160030.
…….Complainant
Versus
AdiSports India Pvt. Ltd., GF 001, FF-40,41,42,43,44, Cosmo Plaza, NH-22, Mohali, Zirakpur through its Proprietor/Manager/Authorised Signatory.
……..Opposite Party No.1
Adidas India Marketing Private Limited, 5th Floor, Sector 45, Block-B, Greenwood City, Gurgaon-122001 Haryana, India.
……..Opposite Party No.2
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: Ms. Shiti Jain Dutt, counsel for complainant.
Shri Manoj Lakhotia, counsel for the OPs.
Order by :- Shri G.K. Dhir, President.
Order
Complainant, after seeing the displayed advertisement of sale of OP No.1 in August 2016, purchased one Pant and one Sweat Shirt, on the tags of which MRP of Rs.2,099/- and Rs.2,699/- were mentioned. Discount of flat 60% on the price mentioning MRP (inclusive of all taxes) was offered. So discounted price of the purchased products was Rs.1919.20 N.P. but OP No.1 charged VAT of Rs.116.11 N.P. @ 6.05% on this discounted price. Act of charging VAT on the discounted price alleged to be unfair trade practice as described in Section 2 (1) (r) of the Consumer Protection Act, 1986. OP No.2 is manufacturer/importer of brand Reebok, but OP No.1 is local dealer from whom complainant purchased the articles in question. Charging of VAT alleged to have caused harassment and pain to complainant and as such this complaint filed for seeking refund of excess charged amount of Rs.116.11 N.P. as VAT alongwith compensation for mental harassment and agony of Rs.50,000/-, but litigation expenses of Rs.15,000/-.
2. In reply filed by OPs jointly it is pleaded inter alia as if jurisdiction of this Forum has been wrongly invoked because disputes arising out of the transaction are subject to jurisdiction of Gurgaon only; complainant alleged to be not a consumer within the meaning of Section 2 (1) (d) of the Act. Moreover, complaint alleged to be vague, misconceived and based on baseless assumptions. Issue of charging VAT on discounted price is already sub judice before Hon’ble Supreme Court of India in SLP No.8868 of 2017 titled as M/s. Aero Club (Woodland) Vs. Rakesh Sharma. SLP in that respect has been admitted by granting leave vide orders dated 31.03.2017 by Hon’ble Supreme Court of India. OP Company has acquired good market reputation for its range of products. Complainant has failed to disclose terms and conditions of invitation of discount offer. No unfair trade practice alleged to be adopted by OPs. Complainant after application of mind accepted terms and conditions of OPs, while paying due consideration amount without any protest. Complaint has been alleged to be filed by complainant as an afterthought for harassing OPs so as to get illegal gain. A reasonable person bound to understand or know the bargain price as discounted price alongwith VAT applicable thereon. In fact, like products are ordinarily sold at a discount in the market with VAT extra charged. Purchase of products in question by complainant not denied, but other contents of the complaint are denied.
3. Complainant to prove his case tendered in evidence her affidavit Ex.CW-1/1 alongwith documents Ex.C-1 to C-4 and thereafter closed evidence.
4. Counsel for the OPs tendered in evidence affidavit of Gurpreet Mann, authorised signatory/representative of OPs Ex.OP-1/1 alongwith documents Ex.OP-1 and Mark-A and thereafter closed evidence.
5. Written arguments not submitted. Oral arguments heard and records gone through.
6. Contents of complaint as well as of affidavit and invoice Ex.C-1 establishes that one Pant and one sweatshirt were purchased by complainant after visiting OP No.1 at Zirakpur (District Mohali) on 07.08.2016 by paying price of Rs.2035/- including VAT amount of Rs.116.11 N.P. @ 6.05%. MRP of the purchased products mentioned as Rs.2,099/- and Rs.2,699/- (inclusive of all taxes) on the tags, copies of which are produced on record as Ex.C-3 and Ex.C-4. It is not disputed that discount of 60% was granted on the MRP and it is on the discounted price that VAT @ 6.05% = Rs.116.11 N.P. has been charged. That practice of charging VAT on the discounted price certainly is against the law laid down 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 of 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 lays that when MRP is inclusive of all taxes, then VAT/other taxes cannot be charged separately, meaning thereby that on discounted price no VAT can be charged. In the case before us, VAT has been charged on the discounted price, which is not permissible as per law laid down in the above cases and as such certainly OP No.1, the seller, adopted unfair trade practice in doing so. As and when any unfair trade practice is adopted, then certainly action of the dealer/retailer causes mental tension and harassment to the consumer. So, complainant certainly is entitled to compensation for mental harassment and agony from OP No.1 alone because excess amount charged by OP No.1 and not by OP No.2. Refund of excess charged amount also should be done by OP No.1, who provided deficient services by charging VAT extra on the discounted price, despite the fact that such practice deprecated in the above cited cases.
7. Counsel for OPs vehemently contends that display was put forth on the counters as well as around the show room and on the website that VAT will be charged extra on the discounted price and terms and conditions will apply and as such in view of acceptance of that offer by complainant, now complainant cannot claim that VAT on the discounted price could not be charged. Even if in the copy of alleged notice put up around the show room, mention made “Buy 2 @ 50% off; Buy 1 @ 40% off with VAT extra”, despite that no material produced on record to show as to at which conspicuous place of the show room, original of Ex.OP-1 was put up. Untill and unless place on which Ex.OP-1 displayed is shown to be conspicuous place, it cannot be held that contents of Ex.OP-1 were made known to each and every customer visiting the show room in question, from where the product in question purchased by complainant. Date of display of Ex.OP-1 or place of display of same not specifically mentioned in the reply or in the affidavit Ex.OP-1/1 of Shri Gurpreet Mann, authorised signatory/representative of OP and as such it cannot at all be held that actually this Ex.OP-1 was displayed for providing due information to the customers. Being so, just on the strength of Ex.OP-1 it cannot be held that complainant was made aware of the terms and conditions of the discount offer. If complainant was not made aware of those terms and conditions, then how OP can charge extra VAT amount on the discounted price in violation of the law laid down by Hon’ble National Commission in case of M/s. Aero Club (Woodland) Vs. Rakesh Sharma (supra) qua that no plausible explanation at all is offered. So act of charging of VAT on the discounted price certainly is unfair trade practice in view of facts and circumstances of this case. Being so, complainant entitled for compensation for mental agony and harassment and also to litigation expenses, but of reasonable amount only
8. The counsel for 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 OPs or any of them. 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, District Forum allowed compensation for physical and mental harassment of Rs.2,000/- but litigation expenses of Rs.1,000/-. Those amounts remained unchanged in appeal. 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 No.1 only 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.
9. Learned counsel for the OPs vehemently contends that 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 the Special Leave Petition in that respect has been admitted and as such the proceedings of this complaint should be adjourned sine die. Provisions of Order 41 Rule 5 of CPC provide that mere filing of appeal does not amount to stay of operation of orders under challenge in appeal and as such on the same analogy, it has to be held that on mere filing of SLP alone, it cannot be inferred that operation of the law laid down by Hon’ble National Commission in above cited case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) has been stayed. So long as the operation of law laid down by Hon’ble National Commission not stayed, the same to prevail and as such there is no need to adjourn the proceedings sine die.
10. As a sequel of above discussion, the complaint is allowed with direction to OP No.1 to refund excess charged amount of Rs.116.11 N.P. with interest @ 6% per annum w.e.f. 07.08.2016 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 No.1. Payment of amount of compensation and litigation expenses be made within 30 days from the date of receipt of certified copy of the order. Complaint against OP No.2 the manufacturer/ importer, however, dismissed. Certified copies of the order be supplied to the parties free of cost and thereafter the file be indexed and consigned to the record room.
Announced
November 15, 2018.
(G.K. Dhir)
President
(Amrinder Singh Sidhu) Member
(Mrs. Natasha Chopra)
Member
