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

Consumer Complaint No.780 of 2017

                                                 Date of institution:  19.09.2017                                                      Date of decision   :  10.05.2018

Rishi Kumar son of Shri Somnath resident of 430/1, Pipli Wala Town, Manimajra, Chandigarh 160101.

…….Complainant

Vs

Adisports India Pvt. Ltd.  GF 001, FF 40, 41, 42, 43, 44, Cosmo Plaza, NH-22, Mohali, Zirakpur through its Manager or its Authorised Representative.

                                                                ……..Opposite Party

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:    Shri G.K. Dhir, President,

                Shri Amrinder Singh Sidhu,

                Mrs. Natasha Chopra, Member.

Present:     Shri Kirti Kumar, counsel for the complainant.

                Shri Manoj Lakhotia, counsel for the OP.

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

Order

               MRP of product purchased by complainant was Rs.749/- and after giving discount of 30%, the same turned to be Rs.524.30 N.P. OP charged Rs. 31.72 N.P. as VAT amount @ 6.05%. That charging alleged to be unfair trade practice because MRP was inclusive of all taxes. Prayer, therefore, made for directing OP to refund extra charged VAT amount of Rs.31.72 N.P. alongwith interest @ 18% per annum and pay compensation for mental harassment and agony of Rs.50,000/-, but litigation expenses of Rs.22,000/-.

2.             OP filed reply by pleading inter alia as if complaint not maintainable because complainant is not consumer within meaning of Section 2 (1) (d) of Consumer Protection Act; complaint being vague and based on misconceived and baseless assumptions is not maintainable. Moreover, it is claimed that no cause of action available against OP because issue of charging VAT on the discounted price is already under consideration of Hon’ble Supreme Court in Special Leave Petition No.8868 of 2017 titled as  M/s. Aero Club (Woodland) Vs. Rakesh Sharma. That SLP has been admitted for hearing vide orders dated 31.03.2017. OP has acquired good market reputation for its range of products and is rendering customer friendly services, but this complaint alleged to be filed by suppressing material facts. Complainant has failed to disclose that the invitation to offer discount were prominently displayed by OP on its website as well as around the show room. Complainant after due application of mind accepted the terms and conditions of OP, while paying sale consideration amount without protest and as such now complainant estopped from filing this complaint. Product was sold to complainant as per terms of the contractual obligations, but now complainant is trying to wriggle out of the contract. After going through advertisement and the material placed outside show room, everyone will know that on the discounted price, VAT will be chargeable. Admittedly VAT of amount of Rs.31.72 N.P. charged on the sale price, but same alleged to be charged for paying the same to the State Govt. It is only the State Govt. who can exempt or reduce the tax liability. VAT was rightly levied as per provisions of VAT Tax Act of Punjab and Haryana, 2003. At no point of time it was declared by OP that flat rate of discount will be given on the MRP of the products. VAT is to be calculated on the selling price as per market practice and the same has been done and as such it is claimed that no unfair trade practice adopted by OP.

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 his counsel closed evidence. On the other hand counsel for OP tendered affidavit Ex.OP-1/1 of Shri Gurpreet Mann, authorised signatory alongwith documents Ex.OP-1 and thereafter closed evidence. 

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

5.             Undisputedly the product in question having MRP of Rs.749/- was purchased by complainant from OP on offer of discount @ 30%, by paying VAT @  6.05% of amount of Rs.31.72 N.P. Copy of the invoice Ex.C-1 alongwith tag Ex.C-2 in this respect are produced on record. On the produced tag, MRP of the purchased product is mentioned as Rs.749/- (inclusive of all taxes). So the material produced by complainant itself establishes that MRP was inclusive of all taxes. Being so,  on the discounted price, extra VAT could not have been charged by OP because as per 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 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, if on the sold product mention made regarding MRP inclusive of all taxes, then extra tax (VAT/GST etc.)  cannot be charged on the discounted price and in case it is done, then the same will amount to unfair trade practice. 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. Copy of record of proceedings pending before the Hon’ble Supreme Court is produced on record as Ex.OP-1. Perusal of the same reveals as if leave has been granted for filing the Special Leave Petition. 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 OP to refund excess charged amount of Rs.31.72 N.P. with interest @ 6% per annum w.e.f. 21.05.2017 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. Certified copies be supplied to the parties as per rules.  File be indexed and consigned to record room.

Announced

May 10, 2018.

                                                                (G.K. Dhir)

                                                                President

(Amrinder Singh Sidhu)

Member

(Mrs. Natasha Chopra)

Member