Haryana

Panchkula

CC/174/2018

AASTHA BHARDWAJ - Complainant(s)

Versus

COBB APPARELS PVT.LTD - Opp.Party(s)

SAMDISH-HARPREET

28 Feb 2019

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,  PANCHKULA.                                                            

Consumer Complaint No	:	174 of 2018
Date of Institution	:	08.10.2018
Date of Decision	:	28.02.2019

                                                                                          

Aastha Bhardwaj D/o Sh.Sunil Bhardwaj, R/o H.No.5327/3, MHC Manimajra, Chandigarh.

                                                                                          ….Complainant

Versus

Cobb Apparels Pvt. Ltd., SCO 9, Sector-11, Panchkula, Haryana through its Manager or authorized representative.

                                                                    ….Opposite Party

COMPLAINT UNDER SEC. 12 OF THE CONSUMER PROTECTION ACT, 1986.

 

Before:                 Mr.Satpal, President.

                             Dr.Pawan Kumar Saini, Member.

                             Dr.Sushma Garg, Member.

 

For the Parties:     Mr.Samdish, Adv., for the complainant. 

Op already ex-parte vide order dated 28.11.2018.

ORDER

(Satpal, President)

1.                The complainant has filed this complaint against the Op with the averments that he had purchased one socks from the OP on 28.06.2017 after paying the consideration amount of Rs.63/- (round off). The MRP of the said product was Rs.100/- which was inclusive of all taxes and the Op in order to promote the sale of the articles offered a discount of 40% on the MRP on the products. After giving 40% discount on the product, the price of the product came to Rs.60/- which was inclusive of all taxes but in addition thereto the OP charged VAT @ 5.25% on the discounted price of the product which came to Rs.3/-, therefore, the complainant had to pay Rs.63/- (round off). After seeking the bill, the complainant resisted the same but the OP forced him to pay the final amount of Rs.63/-. The pleading of the complainant went unheard and has left no other option but to pay the amount of Rs.63/- as the OP said that one’s bill has been made, the complainant has to pay the net payable amount. This act of the opposite party amounts to deficiency in service on its part. Hence, this complaint.

2.                Notice was issued to the Op through registered post on 22.10.2018 (vide registered post No.CH054779108IN), which was not received back either served or unserved despite the expiry of 30 days from the issuance of notice to Op; hence it was deemed to be served and thus, due to non appearance of Op, it was proceeded ex-parte by this Forum vide order dated 28.11.2018.

3.                To prove the ex-parte claim of the complainant, the learned counsel for the complainant has tendered the evidence by way of affidavit Annexure C-A alongwith documents Annexure C-1 & C-2 and closed the evidence.

4.                We have heard the learned counsel for the complainant and perused the record carefully and minutely.

It is evident that the complainant purchased one socks from the OP on 28.06.2017 after paying the consideration amount of Rs.63/- vide retail invoice dated 28.06.2017 (Annexure C-1). The Op in order to promote the sale of articles offered a discount of 40% on the MRP on the products. It is further revealed that after giving 40% discount on the product, the price of the product came to Rs.60/- which was inclusive of all taxes. It has also been revealed that the tag of the socks (Annexure C-2) showed the Maximum Retail Price (MRP) of the product as Rs.100/- which was inclusive of all taxes. The grievances of the complainant are that the Op was not authorized to charge any amount over and above as indicated in the tag of the socks as MRP because MRP included all taxes etc. As per complainant, the Op was not permitted and justified to charge any tax such as VAT upon the MRP. As per contention of the complainant, the value of the product after providing 40% discount comes to Rs.60/- and the Op indulging into unfair trade practice has levied the VAT upon the discounted amount of Rs.60/- to the tune of Rs.3/- thereby compelling the complainant to make the payment of Rs.63/-. The complainant has disputed the charging of Rs.3/- as VAT in the present complaint.

5.                Having gone through the invoice dated 28.06.2017 (Annexure C-1), we find that the MRP of the product was Rs.100/- whereupon discount of 40% i.e. Rs.40/- on the MRP has been given. We have also found that the Op has charged the VAT of Rs.3.15 upon the balance payable amount of Rs.40/-. Thus, we have to decide whether the act on the part of Op while charging the VAT on the discounted price of the product is legally justifiable. We have gone through the order dated 23.05.2016 passed by the Hon’ble State Consumer Commission, UT Chandigarh in appeal No.101 of 2016 wherein similar question of law and facts were involved. In the said appeal, the retailer who provided the T-shirt to the consumer, had charged the VAT @ 5% on the discounted price of the T-shirt. In the said appeal, the retailer/shopkeeper had promised the discount of 70% on the MRP of the T-shirt. The Hon’ble State Commission, UT Chandigarh vide said judgment held that no VAT could be charged on the discounted price of the product. The relevant para of the judgment of the said appeal is reproduced as under:-

“11.  After giving our thoughtful consideration, we are of the considered opinion that no one can charge more than the MRP and MRP includes all taxes including VAT/other taxes. When MRP is including all taxes then VAT/other taxes cannot be charged separately. Meaning thereby that MRP includes VAT and after discount no VAT can be charged, so on discounted product also VAT cannot be charged.  

12      Though Opposite Party No.1 had offered 70% discount on the articles in question, still it charged 5% extra VAT on discounted price inspite of specific mention on the tag MRP inclusive of all taxes as is evident vide Annexure C-2. When, once it is mentioned as MRP with inclusive of all taxes, charging of 5% VAT or tax, is certainly against the trade practice. Here we are fortified by the similar view taken by the Hon’ble State Consumer Disputes Redressal Commission, Bangalore, in Appeal No. 3723 of 2011, titled as “The Branch Manager, M/s Shirt Palace Branch, Black Bird Showroom Vs. Chandru H.C.”, decided on 16.01.2014.”

                   Further we have also gone through the order dated 09.02.2017 passed by the Hon’ble National Commission, New Delhi in revision petition No.3156 of 2016 wherein the Hon’ble National Commission, New Delhi  has disapproved/depreciated the practice of the retailer/shopkeeper while charging of VAT on the discounted product.

6.                Now keeping in view the aforesaid legal settled preposition by Hon’ble National Commission, New Delhi and Hon’ble State Commission, UT Chandigarh regarding the charging of VAT over the discounted price, we advert to the facts of the present case which make it evident that the complainant was tempted to purchase the socks on the basis of allurement made by the complainant that product i.e. socks would be made available at the discounted price of 40% of MRP. If the retailers/shopkeepers are permitted to charge the VAT or GST over the discounted price then that would definitely be contrary to the promise made by the retailers. At this juncture, it would be relevant to mention here that the version of the complainant is fully corroborated by affidavit Annexure C-A as also the documents Annexure C-1 & C-2 whereas on the other hand, the Op has preferred to be proceeded ex-parte and thus, for the want of any challenge to the correctness of the version of the complainant as contained in the complaint the same is taken as proved on record. In the backdrop of the above stated factual position as also the aforesaid legal preposition as held by the Hon’ble State Commission, UT Chandigarh and Hon’ble National Commission, we have no doubt with regard to the lapse and deficiency on the part of Ops while charging GST on the discounted price of the product; hence, the complainant is entitled to relief.

7.                As a sequel to above, we dispose of the present complaint by partly allowing it with directions to the Ops to refund the amount of Rs.3.15 charged as VAT to the complainant alongwith interest @ 9% per annum from the date of filing of present complaint till its realization. The Op is further directed to pay a lump sum amount of Rs.4,000/- as compensation for mental agony, harassment. The Op is further directed to pay a lump sum amount of Rs.1000/- as cost of litigation. Let the order be complied with within the period of 30 days from the receipt of certified copy of this order.  A copy of this order be sent to the parties free of costs and file be consigned to the record room after due compliance.

 

ANNOUNCED

28.02.2019        (Dr.Sushma Garg)     (Dr.Pawan Kumar Saini)        (Satpal)

                                 Member                   Member                                President

 

Note: Each and every page of this order has been duly signed by me.

 

    

                                                                     Satpal

                                                                             President