DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)
Consumer Complaint No.610 of 2018
Date of institution: 12.06.2018 Date of decision : 09.01.2019
Mohit Sharma son of Shri Narinder Sharma, resident of House No.121, Block-S, Shivalik Vihar, Naya Gaon, Mohali (Punjab).
…….Complainant
Versus
1. Firstcry (A FirstCry- Mahindra Venture), Rajashree Business Park, Plot No.114, Third Floor, Survey No.338, Near Sohrabh Hall, Tadiwala Road, Pune through its Manager or authorised representative.
2. Digital Age Retail Pvt. Ltd., Khasra No.585/2, Palam Vihar Road, Bijwasan, New Delhi.
……..Opposite Parties
Complaint under Section 12 of
the Consumer Protection Act.
Quorum: Shri G.K. Dhir, President,
Mrs. Natasha Chopra, Member.
Present: Shri Arjun Veer Sharma, counsel for complainant.
Shri Navneet Jindal, counsel for the OPs.
Order by :- Shri G.K. Dhir, President.
Order
Complainant purchased one product from OPs on 03.03.2018 by paying amount of Rs.1481.53 against retail invoice of that date. However, IGST @ 18% of amount of Rs.226/- on the discounted price charged despite the fact that MRP was inclusive of all taxes. That practice of charging GST on the discounted price alleged to be illegal and unfair trade practice. So this complaint for seeking refund of Rs.226/- with interest @ 18% per annum. Compensation for mental and physical harassment of Rs.25,000/- and litigation expenses of Rs.15,000/- more claimed.
2. In this case Digital Age Retail Pvt. Ltd. was impleaded as OP No.2 vide orders dated 30.11.2018 and today counsel for OPs suffered statement that written statement already filed be treated as written statement on behalf of both the OPs.
3. It is pleaded through written reply as if complaint in present form not maintainable and reply has been submitted through Mr. Sagar Panaskar, authorised representative, in whose favour resolution by Board of Directors has been passed. Further it is claimed that First Cry is a brand name belonging to Brainbees Solutions Pvt. Ltd. However, the online platform is run, operated and managed by Digital Age Retail Private Limited because of brand license agreement executed between Brainbees Solutions Pvt. Ltd. and OP. OP is engaged in business of retail trading of maternity, baby and kids products through online platform. Complainant received the order and voluntarily accepted product knowing fully well about the concept of MRP, discount and applicable GST charges. Complainant has produced invoice copy, in which mention of applicable charges on the purchased products is made. Website and invoice clearly displays actual MRP of the product. In case complainant has any grievance regarding applicable charges, then he could have refrained OPs from proceeding with the placed order delivery, but same not done and as such present complaint alleged to be filed on afterthought version. In the website illustrative table “Terms of Use” is provided, wherein it is categorically mentioned that GST will be applicable, if the discount provided is more than 19%. The base percentage of 19% for attracting GST is commercial call taken by OPs. This GST after being collected is deposited with GST authorities as per applicable GST Act and Rules. Complainant has made bulk orders using the same account under different billing names. So the purchased products cannot be said to be meant for personal consumption. OPs are giving various additional discounts apart from regular discount on the website like loyalty cash, gift certificates and cash refund. Complainant is liable to make payment of GST. No unfair trade practice adopted by OPs. As such by denying each and every other averment of the complaint, prayer made for dismissal of the complaint, more so when deficiency in service not established.
4. Complainant to prove his case tendered in evidence his affidavit Ex.CW-1/1 alongwith documents Ex.C-1 and Ex.C-2 and thereafter closed evidence. On the other hand, counsel for OPs tendered in evidence affidavit Ex.OP-1/1 of Shri Sagar Panaskar, authorised representative alongwith documents Ex.OP-1 and Ex.OP-2 and thereafter closed evidence.
5. Written arguments not submitted by any of the parties. Oral arguments heard and records gone through.
6. Perusal of invoice Ex.C-1 reveals that GST of amount of Rs.226/- has been charged on the product purchased by complainant through this invoice dated 03.03.2018. MRP of the product given as Rs.1699/- and after discount of Rs.443.47 N.P. thereon, amount of Rs.1481.53 N.P. including IGST of Rs.226/- has been charged. So it is obvious that IGST has been charged on the discounted price, despite the fact that tag Ex.C-2 establishes that MRP is inclusive of all taxes. Practice of charging tax on the discounted price having MRP inclusive of all taxes has been deprecated 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. So practice of charging tax on the discounted price of the products having MRP inclusive of all taxes in this case certainly is unfair trade practice.
7. Even if tax to be charged from the buyer, despite that the terms of such practice can be changed by mutually arrived at contract through which the seller may undertake liability to pay tax on the discounted price of a product having MRP inclusive of all taxes. It was OPs themselves who professed through tag Ex.C-2 that MRP will be inclusive of all taxes and as such on the discounted price, OPs by such undertaking bound to pay taxes. Complainant on representation of OPs of discount offer on products having MRP inclusive of all taxes, purchased the products in question from OPs and as such now OPs estopped by their act and conduct from claiming that tax to be charged extra on the discounted price, especially when law on the subject referred above is to the contrary.
8. Contention of counsel for OPs that GST will be applicable in case discount provided is above 19% as per terms of use, has no force because there cannot be discrimination in matter of allowing concession on one product having MRP inclusive of all taxes vis. a vis. other product also having MRP inclusive of all taxes.
9. Even if displays regarding charging GST may have been put on the website as denoted through terms of use Ex.OP-2, despite that there is clause “applicability of GST”, of discount coupons and/or cash back offers includes an extra component of GST benefits, being passed on to customers. This means that GST benefits on discounted price to be passed on to the consumers like complainant, which means that GST in excess of discounted price cannot be charged.
10. No other point argued.
11. As a sequel of above discussion, complaint is allowed with direction to OPs to refund excess charged amount of Rs.226/- with interest @ 6% per annum w.e.f. 03.03.2018 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
January 09, 2019.
(G.K. Dhir)
President
(Mrs. Natasha Chopra)
Member
