Delhi

West Delhi

CC/16/759

NARAYAN SINGH - Complainant(s)

Versus

INDIA INFOLINE LTD. - Opp.Party(s)

31 Oct 2022

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION-III (WEST)

GOVT. OF NCT OF DELHI

C-150-151, COMMUNITY CENTRE, JANAKPURI

NEW DELHI-110058

 

Complaint Case No.  759/16

 

In the matter of:

 

NARAYAN SINGH

VERSUS

INDIA INFOLINE LTD.

DATE OF INSTITUTION:    JUDGMENT RESERVED ON:         DATE OF DECISION      :

22.11.2016 11.10.2022 31.10.2022

Coram:

 

Ms Sonica Mehrotra, President

Ms Richa Jindal, Member

Mr Anil Kumar Koushal, Member

 

Order passed by : Richa Jindal, Member

 

ORDER

1. That the complainant has filed a present complaint under section 12 of the CPA Act,1986 alleging deficiency service on the part of Ops and claims compensation. Brief Facts of the complaint are as follows:-

 

1. The complainant is a customer of OP with client ID-Narain30 dealing online in securities.

 

2. The OP is a company engaged in brokering business of dealing in listed securities in the National stock exchange and Bombay stock exchange and providing services online to its customers.

 

3. the Complainant stated that he was forced/compelled to do any type of tradingas the market is in sound condition and the complainant was informed about the charges for service of sending SMS for six months for Rs.6,000/- and after his consent and the OP send his runner to collect the same from the Complainant on 10^th April 2015 and the complainant paid the same through cheque favouring someone as informed by Mamta Malik and the cheque was debited from his account.
4. To the surprise of the complainant although the cheque was cleared,the said amount has not been credited in the ledger account of the Complainant maintained at the office of the Indian Infoline Ltd. i.e. OP.
5. After obtaining the above-mentioned service of SMSs, the SMSs on the mobile of the Complainant as usual started coming. After seeing those messages,the Complainant was not able to understand the same or that the information, he was getting through the SMSwas the same as available in the newspapers and the Complainant had asked the OP to stop the above-mentioned services.
6. The Complainant was further asked to deposit a sum of Rs. 1058.78 as this was the debit balance against the Complainant and without the consent of the complainant, the OP illegally sold some of the shares on 18/10/2016.
7. The complainant stated that the amount of Rs.6,000/- deposited by the Complainant through the Cheque was admitted by the OP dated 06/07/2015, still the OP even after having the information kept demanding the excess debit amount.
8. The complainant gain wrotevarious letters dated 12/06/2015, 15/06/2015 or 26/06/2015 duly received by the OP and they assured the Complainant that the adjusted amount could be used for any other services.
9. The OP has charged the Complainant twice for one service and that too the service was imposed on the Complainant even though it was not allegedly useful for him.
10. At the time of opening the account, it was informed to the complainant that the monthly charges at the rate of 25+ service tax would be levied but the OP’s illegally charged at the rate of 40 + service tax.

 

11. The above-mentioned act of the respondent has caused a lot of monetary loss as well as mental and physical agony to the complainant for which the respondent is liable to compensate the complainant.

 

• The complainant filed the present complaint wherein the respondent is liable to refund an amount of Rs 6,000/- alongwith interest and to return the shares, which were illegally sold by OP to the complainant due to which loss happened due to the selling of the shares from her account i.e., Rs.2705.70/-along with interest till the realization of the amount as well as Rs 10,000/- as compensation towards distress and mental agony along withthe cost of litigation.

2.       After hearing arguments on admission, a court notice was issued to OP’s returnable on 7/12/2009. Accordingly, OP appeared and filed a reply, wherein OP took the following preliminary objections:

1. That the present Complaint is liable to be dismissed as the Complainant is not a Consumer within the meaning the of Consumer Protection Act as he is using services of the respondent for commercial purposes for making a profit by buying and selling of shares and trading in the stock market is a commercial activity and the compensation cannot be claimed in the Consumer Forum as per the settled law of Hon'ble NCDRC in the case titled M/s Steel City Securities Ltd. Vs G.P. Ramesh & Ors. (RP 3060 of 2016) and Unit Trust of India Vs Sabitri Devi and also in the case titled Sunita Rani Vs Zee Telefilms Ltd. it was held that shares are commercial activity and thus not covered under the jurisdiction of the Consumer Forums.

 

2. The present Complaint is liable to be dismissed as the same has been filed without any basis, unfounded and does not have any merit. The present Complaint is nothing but an abuse process of law and hence the same is liable to be dismissed.

 

3. The present Complaint is liable to be dismissed as the Complainant has concealed the material facts from this Hon'ble Forum and has not approached this Hon'ble Forum with clean hands and averred inaccurate, untrue and misleading facts before this Hon'ble Forum.

 

4. The present Complaint is liable to be dismissed as the same is prima-facie on the face of it a false, frivolous, malicious and vexatious and the same has been filed with the ulterior motive to indulge in speculative litigation taking advantage of the beneficial legislation and to extort money and to harass the respondent. Hence the OP prayed for the dismissal of the present Complaint in the interest of justice.

 

4. Thereafter complainant filed their evidence by way of the affidavit but despite opportunities,the Opposite party failed tofile their evidence and did not appear. Hence, they proceeded exparte vide order dated 7/05/2019. 
5. However later on after the corona pandemic was over and after resuming the bench to its work, despite of various opportunities the complainant failed to appear. However, during the perusal of records, this bench made a specific observation that this matter pertains to transactions relating to the online trading of shares which is commercial in nature.

6. We have carefully gone through the record of the case since nobody came forward to address their arguments.
7. After going through the material placed on record, it reveals that it is an admitted fact that the complainant had been indulging in trading of the shares as respondents in their complaint have stated that they are regularly transacting the transactions through the petitioner. Thus, the short question which arises for consideration in the present case is whether the complainant is a ‘consumer’ or not as per Section 2(1)(d) of the Consumer Protection Act,1986 or not.
8. The only aspect for consideration before us is whether the Complainant was excluded from the purview of the definition of “consumer” under Section 2(1)(d) of the Consumer Protection Act, 1986 on account of the subject transaction amounting to sale or for being for a commercial purpose. As per the law of land, it is already settled that issue of maintainability can be decided at any stage. Reliance is placed on the following Judgement: -

 

Hon'ble Supreme Court in a case tilted as “ Hewlett Packard India Ltd. Vs Shri RamaChander Gehlot” in CA No. 7107/2003 decided on 16.02.2004 held that

 

“Issue of maintainability has to be decided before admitting or hearing the matter on merit.”

 

8. in FIRST APPEAL NO. 337 OF 2017 in a case titled “KOSHY VARGHESE THAVALATHI HOUSE, MELE VETTIPURAM, PATHANAMTHITTA Versus HDFC BANK LTD. & 2 ORS.” Held that

 

“It is settled law that the question in which law point is involved can be decided at any stage of the proceedings of the case.

 

9. In case title “Shashi Bhushan Shori vs The Chairman-Cum-Managing Director” decided on 4th October 2012 decided by STATE CONSUMER DISPUTES REDRESSAL COMMISSION, U.T., CHANDIGARH in First Appeal No. 230 of 2012 held that

“It is, however, the settled principle of law, that the Consumer Foras, at any stage of the proceedings, are duty bound to decide of their own, the legal questions, as to whether the complainant fell within the definition of a consumer; whether they (Foras) had territorial and pecuniary jurisdiction to entertain and decide the complaint;”

 

10. Since the Act gives protection to the consumer in respect of service rendered to him, the expression "service" in the Act has to be construed keeping in view the definition of "consumer" in the Act. It is, therefore, necessary to set out the definition of the expression `consumer' contained in Section 2(1)(d) in so far as it relates to services and the definition of the expression `service' contained in Section 2(1) (o) of the old Act. The said provisions are as follows :

“2(1)(d) “consumer” means any person who—

                       

1. partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person but does not include a person who obtains such goods for resale or any commercial purpose; or
2. hires or avails of any service for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such service other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first-mentioned person, but does not include a person who avails of such service for any commercial purpose.

 

Explanation.—For this clause—

 

1. the expression "commercial purpose" does not include the use by a person of goods bought and used by him exclusively to earn his livelihood, using self-employment;

 

(b)   the expressions "buy any goods" and "hires or avails any services" include offline or online transactions through electronic means or by teleshopping or direct selling or multi-level marketing;

11.  

The definition of `service' in Section 2(1)(o) of the Act can be split up into three parts –

1. the main part, the inclusionary part and the exclusionary part. The main part is explanatory in nature and defines service to mean service of any description which is made available to potential users.
2. The inclusionary part expressly includes the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both housing construction, entertainment, amusement or the purveying of news or other information.
3.  

 

12.   Counsel for the complainant argued that the complainant had maintained a current account in their branch, which is used for commercial transactions only. The term ‘consumer’ has, thus, been defined to mean, a person who isa buyer, or with the approval of the buyer, the user of the goods in question, or a hirer or person otherwise availing, or with the approval of such aforesaid persons, the beneficiary, of the service(s) in question with the condition superadded that such buying of the goods or hiring or availing of any such service, is for a consideration, - paid, or promised, or partly paid or promised, or covered by any system of deferred payment The term consumer used in Section 2(1)(d) of the Consumer Protection Act 1986 came up for consideration in Laxmi Engineering Works Vs PSG Industrial Institute (1995) 3 SCC 583 passed by Hon’ble Supreme Courtin which the two-judge bench of the Hon’ble Apex Court elucidated upon the meaning of ‘commercial purpose’ as follows: …The explanation reduces the question, of what is a “commercial purpose”, to a question of fact to be decided in the facts of each case. It is not the value of the goods that matters but the purpose to which the goods bought are put. The several words employed in the explanation, viz., “use them by himself”, exclusively to earn his livelihood” and “using self-employment” make the intention of Parliament abundantly clear, that the goods bought must be used by the buyer himself, by employing himself for earning his livelihood.” (Emphasis Supplied)

13.   The said observations form part of the order passed by Hon'ble Supreme Court in Lilavati Kirtilal Mehta Medical Trust Vs Unique Shanti Developers IV (2019) CPJ 65 (SC) passed on 14.11.2019 in Civil Appeal no. 12322/2016 in which the Hon'ble Supreme Court post discussion on the said issue of determining/defining commercial purpose, which cannot be strait-jacketed, culled out the following broad principles for determining whether an activity or transaction is ‘for a commercial purpose’: The question of whether a transaction is for a commercial purpose would depend upon the facts and circumstances of each case. However, ordinarily, ‘commercial purpose’ is understood to include manufacturing / industrial activity or business-to-business transactions between commercial entities. The purchase of goods or services should have a close and direct nexus with a profit-generating activity. The identity of the person making the purchase or the value of the transaction is not conclusive to the question of whether it is for a commercial purpose. It has to be seen whether the dominant intention or dominant purpose for the transaction was to facilitate some kind of profit generation for the purchaser and/or their beneficiary.

14.   In the case of Som Nath Jain v. R.C. Goenka & Anr., reported in I (1994) CPJ 27 (NC). In that case, dealing with the sale purchase of shares, the National Commission expressed serious doubt whether the complaint qua would be maintainable under the Consumer Protection Act. Because, qua such transactions, elaborate evidence needs to be taken regarding the purchase and sale of shares, their prevalent price in the market and evidence regarding the passing of instructions by the client to the broker. Resultantly, the complainants were relegated to get the dispute decided through civil Court.

 

15.   Further Hon’ble NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION in Steel City Securities Ltd. Vs GP Ramesh decided on 3^rd February 2014 in REVISION PETITION NO.3060 OF 2011 held that

“Since, respondents are trading regularly in the share business, which is a commercial activity, under these circumstances, respondents would not fall under the definition of ‘consumer’ as per the Act. Moreover, regular trading in the sale and purchase of shares is a purely commercial activity and the only motive is to earn profits. Therefore, this activity being purely commercial one is not covered under the provisions of the Act. Accordingly, we hold that since respondents are not the ‘consumers’ as per provisions of the Act. "

 

16.   It said NCDRC in Vijay Kumar Vs. IndusInd Bank, II (2012) CPJ 181 (NC) has held;

“Since, the petitioner has been trading regularly in the shares which is a commercial transaction and for which he has also availed the “overdraft facility” from the respondent, as such he would not be a consumer as per Section 2 (1) (d) (ii) of the Act. Moreover, regular trading in the purchase and sale of shares is a commercial transaction and the only motive is to earn profit. Thus, this activity is a purely commercial one and is not covered under the Act”.

 

17.   Supreme Court’s decision in Morgan Stanley Mutual Funds v. Kartick Das, (1994) 4 SCC 224 the law laid down by the Supreme Court still holds good.

“33. Certainly, clauses (iii) and (iv) of Section 2(1)(c) of the Act do not arise in this case. Therefore, what requires to be examined is, whether any unfair trade practice has been adopted. The expression ‘unfair trade practice’ as per rules shall have the same meaning as defined under Section 36-A of the Monopolies and Restrictive Trade Practices Act, 1969. That again cannot apply because the company is not trading in shares. A share means a share in the capital. The object of issuing the same is for building up capital. To raise capital means making arrangements for carrying on the trade. It is not a practice relating to the carrying of any trade. The creation of share capital without allotment of shares does not bring shares into existence. Therefore, our answer is that a prospective investor like the respondent or the association is not a consumer under the Act. Q. 2: Whether the appellant company trades in shares?”

18.    In a recent judgement titled “Baidyanath Mondal v. Kanahaya Lal Rathi”  , decided on 29-4-2022, Hon’ble NCDRC held that

        “It is not the case of the Complainant that he had invested the money in the share market exclusively for earning his livelihood. In this regard, the State Commission observed as follows: -

“The above facts and circumstances clearly indicate that the transactions involved in the case on hand are commercial activities and such commercial activities are not exclusively for the purpose of self-employment of the Appellant/Complainant and thus the Appellant/Complainant is not covered by inclusive explanation appended to Section 2 (1) (d) of the Consumer Protection Act, 1986 and hence, the Appellant/Complainant does not fall within the definition of “Consumer” as defined u/s 2 (1) (d) of the Consumer  Protection Act, 1986.”

Hence, the complainant was not a consumer and the state commission had passed a well-reasoned order.

 

19.   The decision of Hon'ble National Commission in Vishwanidhi Dalmia v. India Infoline Commodities Ltd., 2017 (1) CPR 153 (NC) too cannot have any bearing in the instant case given that share trading and purchasing shares cannot be equated under any circumstances.  It has nowhere been pleaded that the complainant was carrying on aforesaid activities for earning his livelihood by means of self-employment and when the complainant had executed power of attorney in favour of OP No. 1 to trade in commodities on his behalf, it cannot be said that complainant was carrying on aforesaid activities for earning his livelihood by means of self-employment and in such circumstances, Consumer Fora has no jurisdiction to entertain the complaint as complainant does not fall with the purview of consumer under C.P. Act.

 

20.   In Ramendra Nath Basu Vs. Sanjeev Kapoor & Anr. I (2009) CPJ 316 has held that share trading transactions between parties do not come under the purview of the Consumer Protection Act, of 1986. Similarly, the Hon’ble Delhi State Consumer Disputes Redressal Commission in the case of Anand Prakash Vs. A.M. Johri & Ors. III (2000) CPJ 291 has held CC No.36/2019 Page 5 of 6 that the sale-purchase of shares are commercial transactions and the complainant does not fall within the purview of the definition of a ‘Consumer’ as defined under Section 2(1)(d) of the Consumer Protection Act, 1986. Further, the Hon’ble National Consumer Disputes Redressal Commission in R.P. No. 1179 of 2012 A. Asaithambi Vs. Company Secretary Satyam Computer Services Ltd. & Ors. also held that the sale and purchase of shares are commercial transactions and do not fall within the purview of the definition of Consumer as contained in the Consumer Protection Act, 1986. Further, Special Leave to Appeal (Civil) No.36840 of 2012 (A. Asithambi Vs. Company Secretary Satyam Computer Services Ltd. & Ors.) filed against the aforesaid judgment was dismissed in limine by the Hon'ble Supreme Court on 14.12.2012. Hon'ble National Commission also took the same view in Dr. V.K. Agarwal Vs. M/s. Infosys Technologies Ltd. Bearing & Ors. O.P. No. 287 of 2001 decided on 24.7.2012 and in R.P. No. 3345 of 2012 M/s. Sterlite Industries (India) Ltd. Vs. Ganapati Finsec Pvt. Ltd. decided on 12.7.2013.

 

 21.  In the present case, it is evident from a bare perusal of the complaint and documents annexed thereto by the complainant himself as well as by OP that the complainant is trying to camouflage a business of online trading under the garb of a consumer dispute which is purely commercial. Since the account itself was connected and related to the commercial transaction of the complainant, the service hired for that purpose would fall within the category of hiring services for commercial purposes and therefore is not a subject matter to be decided on merits by this Forum. Requirements of the restricted meaning of “Commercial Purpose” are that the complainant ought to have availed of the services of OP exclusively for purpose of earning livelihood by way of self-employment.

22.   The Hon’ble SCDRC Delhi in the recent judgment of Indo Arab Air Services Vs ICICI Home Finance Co. Ltd. I (2020) CPJ 220 (Del) decided on 20.12.2019 held that a loan against property is a transaction done for commercial purposes and therefore outside the scope and ambit of provision of the Act and had dismissed the complaint.

23.   The Hon'ble National Commission in the recent judgment of Ratna Bose vs India Infoline Ltd. on 25 February 2020 reported in 2020 1 CPR (NC) 851 held that  

“ It is an admitted fact that Petitioner had been indulging in trading of the shares. Thus, the short question, which arises for consideration in the present case is whether Petitioner is a Consumer or not as per Section 2(1) (d) of the Consumer Protection Act, 1986. Since the petitioner has been trading regularly in the shares which is a commercial transaction as such he would not be a consumer as per Section 2 (1) (d) (ii) of the Act. Moreover, regular trading in the purchase and sale of shares is a commercial transaction and the only motive is to earn profit. Thus, this activity is purely commercial and is not covered under the Act.”

24.   The Hon'ble National Commission in the judgment of Freight System (India) Pvt. Ltd. Vs Omkar Realtors and Developers Pvt. Ltd. II (2021) CPJ 33 (NC) in CC no. 886/2020 decided on 25.01.2021 observed that a company is included in the definition of ‘person’ contained in Section 2(31) of CPA 2019, it is not per se precluded from being ‘consumer’, provided, if, for a particular purpose, it means the requirement of ‘consumer’ as defined in Section 2(7) of the Act of 2019 explanation to which concerning “commercial purpose” excludes use by such a person.

25.   A plain reading of Section 2(7)(ii) and Section 2(42) of the Act 2019 makes it clear that the complainant company which had availed services of a bank for promoting business and earning profit is not a consumer under the Act 2019. The Hon'ble National Commission relying upon the verdict of the Hon'ble Supreme Court in the Lilavati Supra case where ‘broad principles’ including the yardstick of ‘close and direct nexus’ and ‘dominant purpose’ were laid down, observes that such tests would be extrapolated to juridical person depending on facts and circumstances of each case.

26.   Applying the said ratio which is squarely relevant to the present case, the services availed by the complainant from OP had a ‘close and direct nexus’ to furthering business prospects for commercial profitability and the ‘dominant purpose’ behind availing such service was the link to large scale commercial activity and even otherwise it was never the case of the complainant in pleadings or oral submission that it was a consumer within the meaning of Section 2(7)(ii) of the Act 2019 or that the services from OP were availed for self-employment or generating livelihood and therefore cannot be construed within the service as defined Section 2(42) CPA 2019. The Hon'ble National Commission had, therefore, dismissed the Freight (supra) complaint in limine on facts and law.

27.   We are guided by the above-settled principle of law as discussed at length in the legal discourse of catena of judgments passed by the Hon’ble Apex Court and Hon’ble NCDRC cited in forgoing paras and can be safely applied in the present case especially after appreciating the nature of transaction entered into between complainant and OP and the perusal of cash credit facility letter, project work order and emails exchanged between complainant and OP about the cash credit facility etc., placed on record by the complainant himself.

28.   The case of the complainant relates to the relationship between the complainant and OP to further commercial activity for which the complainant had availed the services of OP for commercial purposes. Therefore, because of the inbuilt exception in the definition of consumer, the complainant cannot be termed as a consumer as envisaged under Section 2(7)(ii) of the Act.

29.    According to Section 2(1)(d)(i) of the Act, the consumer does not include a person, who obtains such goods for resale or any commercial purpose. Section 2(1)(d)(ii), which was amended by Act 62 of 2002 w.e.f. 15.03.2003, clearly lays down that the person who hires or avails of the services for consideration, for any commercial purpose, shall not qualify, as a consumer. In the instant case, the complainant, availed of the services of the Opposite Parties, by obtaining a credit facility, in the sum of Rs.245 lacs, for commercial purposes. In other words, he took the credit facility for furthering his business, to generate huge profits, and, as such, he did not fall within the definition of a consumer.

30.   In Economic Transport Organization Vs. Charan Spinning Mills (P) Ltd., & Anr., I (2010) CPJ 4 (SC), a four Judge Bench, of the Hon’ble Apex Court, also held that, after the amendment of Section 2(d) of the Act w.e.f.15.03.2003, the services of the carriers, it had been availed of, for any commercial purpose, then the person availing of the services will not be a consumer. In Birla Technologies Ltd. Vs Neutral Glass and Allied Industries Ltd. 2011 (1), SCC 525 and Sanjay D. Ghodawat Vs R.R.B. Energy Ltd. IV (2010) CPJ178(NC), a case decided by a Full Bench of the Hon’ble National Commission, the similar principle of law was laid down. In Sushma Goel Vs Punjab National Bank 2011 Consumer Protection Judgments 270(NC), the complaint related to the operation of a bank account maintained by a commercial entity for commercial purposes. It was held that the complainant did not fall within the definition of a consumer. Since, the services of the Opposite Parties/respondents, in the instant case, were availed of, by the complainant/appellant, for the commercial purpose of earning huge profits, he did not fall within the ambit of a consumer, and, as such, the complaint was not maintainable.

31.   The National Consumer Dispute Redressal Commission (NCDRC), while dismissing a revision petition in various cases has clarified that a person regularly trading in the share market does not fall under the definition of 'consumer' as per the Consumer Protection Act, 1986. Since, respondents are trading regularly in the share business, which is a commercial activity, under these circumstances, respondents would not fall under the definition of ‘consumer’ as per the Act. Moreover, regular trading in the sale and purchase of shares is a purely commercial activity and the only motive is to earn profits. Therefore, this activity being purely commercial is not covered under the provisions of the Act."

 

32.   That being the case, the complainant has no locus standi to file the present complaint before this Commission and therefore we have no hesitation in concluding inescapably that the complainant is not a consumer and, on this count, alone, dismiss the present complaint.

 

33.   It is however made clear that denial to avail remedy before a consumer protection Commission to a ‘person’ who is not a ‘consumer’ and does not meet the ingredient of ‘consumer’ under the Act 2019 does not take away or affect his right to agitate his case in any appropriate forum/court as per law. Notwithstanding or having said so, on the present complaint which blatantly is a commercial dispute but has been filed before this Commission, we are guided by the observation of Hon'ble National Commission in Freight (Supra) case here that anyhow allowing anyone into consumer protection fora has adverse ramification, including inter alia: Evasion of court fee in Civil Courts; and Eroding into the time and resources of consumer protection Fora, which could otherwise be better devoted to the ordinary general consumers, who straightway fall, ex facie, in the definition of ‘consumer’ (without having to write a treatise to enable their anyhow entry into the Fora).

34. M/s Ashina Inn Limited and another vs Punjab and Sindh Bankvide CC No. 99 of 2013 decided by the National Commission on 5.07.2013 wherein the Hon’ble National Commission has considered the definition of the consumer before and after the amendment of the C. P. Act and it held that commercial purpose, for Section 2(1)(d) does not include service availed by a person exclusively to earn his livelihood using self-employment and the explanation to Section 2(1)(d) of C.P. Act restricting the scope of commercial purpose does not help a body corporate to fit in the definition of consumer.

35.   Hon’ble NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI in FIRST APPEAL NO. 337 OF 2017 in a case titled “KOSHY VARGHESE THAVALATHI HOUSE, MELE VETTIPURAM, PATHANAMTHITTA Versus HDFC BANK LTD. & 2 ORS.” Held that

        “The contentions raised were that the appellant was not a consumer as defined under Section 2 (1) (d) of the Consumer Protection Act. The loan against shares was an overdraft account opened by the appellant with the respondent bank against the security of equity shares pledged with them. Further investment in equity shares was in the nature of speculative investment made for commercial purpose. The investment carried an inherent risk of capital erosion which can be caused by dips in the stock market. Such investments cannot be said to be made for earning livelihood since they do not guarantee any returns and can even wipe out the entire investment made by the investor. Dealing with equity shares cannot be treated as one for earning a livelihood. Hence, the Appellant/Complainant is not a 'Consumer' as per Section (2) (1) (d) of the Act and the Complaint filed by the Appellant /Complainant is not maintainable and is liable to be dismissed on this sole ground.”

36.   In lieu of the National Commission judgement titled Punjab National Bank vs Sant Ram Harbans Lal reported in 2016(2) CPR 584 (NC) it is observed that although counsel for the complainant in the present case has contended that the case of the complainant is covered under the explanation to Section 2 (1) (d) of the CP Act, 1986. On reading the explanation it is clear that the explanation restricts the definition of commercial purpose by providing that commercial purpose does not include the use by a person of goods bought or services availed exclusively to earn his livelihood using self-employment. The user of the words "earning of his livelihood using self-employment" in the explanation makes it clear that the explanation carves out an exception only in respect of natural persons. The complainant being an online share trader, by no stretch of the imagination can claim to avail of the benefit of the explanation to Section 2 (1) (d) of the Act. Thus, we do not find any merit in the contention of learned counsel for the respondent/complainant.

37.   In view of the discussion above, it is obvious that Regular sale and purchase of shares is a purely commercial activity and the only motive is to earn profits. Therefore, this activity is not covered under the provisions of the Consumer Act. the complainant was not investing money in the share market exclusively for earning his livelihood, hence the same was he did not fall under the definition of Consumer. The complainant is not a consumer as envisaged under Section 2 (1) (d) of the Consumer Protection Act, 1986, as such he is not entitled to raise a consumer dispute before the consumer commission.

 

38.   While dismissing the complaint as not maintainable reserve the right of the complainant to approach the appropriate Civil Court to seek its remedy. In the event, the complainants approach the Civil Court or competent forum, the period spent between the filing of the claim before this Commission and till disposal of the matter today will be excluded under Section 14 of the Limitation Act, 1963 in the light of the decision of the Hon’ble Supreme Court in Trai Foods Ltd vs National Insurance Company Ltd and others reported in III (2012) CPJ 17.

39.   The petitioner/complainant is given the liberty to get the redressal of his grievances before the appropriate forum including the civil court as per law.  So far as the period of limitation is concerned, the petitioner can take advantage of the decision rendered in “Lakshmi Engineering Works V. P.S.G. Industrial Institute (1995 ) 3 SCC 583.

40.   Having perused the material on record we are of the opinion that ex-facie the complaint is not maintainable under the provisions of the Consumer Protection Act, and consequently a direction could be given to approaching the appropriate court for seeking relief for which the complaint is filed.

41.   We, therefore, dismiss the present complaint as non-maintainable before this Commission without entering into the merits of the dispute between the opposing sides and the complainant company is free to agitate its case in any appropriate court as per law.

42.   Let a copy of this order be sent to each party free of cost after receiving the application for the certified copy as per the direction received from the Hon’ble State Commission.

43.   File be consigned to record room.

44.   Announced on 31.10.2022.

 

 

 

Richa Jindal                             Anil Kumar Koushal                   Sonica Mehrotra

(Member)                                            (Member)                         (President)