BEFORE THE STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT PUDUCHERRY

WEDNESDAY, 13^th day of April, 2016

FIRST APPPEAL No. 1/2015

M/s Royal Enfield,

A unit of Eicher Motors Limited

Through Customer Service,

Tiruvottiyur High Road, Chennai – 19.      ………..                                        Appellant

                                                                              Vs.

1. K. Vasanth, No.154, Cuddalore Road,

    Radhakrishnan Nagar, Moolakulam,

    Puducherry.

2. Suvani Motors, Rep. by its Proprietor,

    41, Cuddalore Road,

    Thavalakuppam,

    Puducherry

3. Rooster Automobiles,

    Rep. by its Authorised Signatory.

    168, 100 feet Road,

    Opposite to R.T.O.,

    Puducherry – 4.                                       ………….                                Respondents

(On appeal against the order passed in C.C.No.39/2014, dt.18.09.2014 of the District  Consumer Disputes Redressal Forum, Puducherry)

C.C.No.39/2014

K. Vasanth, No.154, Cuddalore Road,

Radhakrishnan Nagar, Moolakulam,

Puducherry.                                           ………….                                     Complainant

                                                                           Vs.

1. M/s Royal Enfield,

    A unit of Eicher Motors Limited

    Through Customer Service,

    Tiruvottiyur High Road, Chennai – 19.    

2. Suvani Motors,

    Rep. by its Proprietor,

    41, Cuddalore Road,

    Thavalakuppam,

    Puducherry

3. Rooster Automobiles

    Rep. by its Authorised Signatory

    168, 100 feet Road,

    Opposite to R.T.O.,

    Puducherry – 4.                                       ………….                           Opposite Parties

BEFORE:

HON’BLE THIRU JUSTICE K.VENKATARAMAN,

PRESIDENT

TMT. K.K.RITHA,

MEMBER

FOR THE APPELLANT:

Mr.S.Vimal,

Advocate, Puducherry

FOR THE RESPONDENT/COMPLAINANT:

Tvl.P.Ilayaraja, D.Sridharan,

M.Darwin Muthu, Advocates, Puducherry.

RESPONDENTS/O.P.S:

2^nd Respondent/O.P.No.2   - Exparte

3^rd Respondent/O.P.No.3 – Party-in-Person

O   R    D    E    R

(By Tmt.K.K.Ritha,  M.A., M.H.R., B.L., Member)

            The present appeal is being preferred by the appellant against the impugned order of the District Forum, Puducherry, dated 18.09.2014 whereby the appellant and 2^nd respondent are directed to pay jointly and severally a sum of Rs.50,000/- with interest at 12% p.a. and Rs.5,000/- as cost of the litigation.

            2. Aggrieved by the order, the appellant has filed this appeal before this Commission.

            3. The appellant is the manufacturer of Royal Enfield Bullet motorbikes and selling through its authorized dealers across India. The 2^nd respondent had been given dealership for selling motorbikes of the appellant in Puducherry and the 3^rd respondent is the subsequent dealer of the appellant. The1^st respondent/complainant had paid a sum of Rs.50,000/- on 10.09.2012 to the 2^nd respondent for purchase of Royal Enfield Classic Black colour motorbike. When he approached the 2^nd respondent on 17.12.2012 for delivery of the vehicle, he was  assured of delivery of vehicle by 31.03.2013.  But, he was shocked to know that the 2^nd respondent without any information, closed the business and absconded by colluding with the appellant.  A criminal case also was filed in this regard by the aggrieved parties.

            4. The appellant states that they failed to contest the matter before the District Forum owing to a human error committed by one of the representatives. The appellant does not sell the motorcycles directly to any individual customers, they are sold only through their dealers. There is no arrangement between 1^st respondent/complainant and 2^nd respondent.   Since the 2^nd respondent was not working as an agent of the appellant, the latter cannot take responsibility for the acts of commission and omission committed by the former.  Moreover, the 2^nd respondent had not placed any booking with the appellant at the behest of 1^st respondent/complainant. The appellant was not aware of any criminal complaint filed by the customers against 2^nd respondent.  The appellant had been asking the 2^nd respondent  to furnish its statement and accounts with regard to the booking of the motorcycles. Since the 2^nd respondent was not acting in accordance with dealership norms and requirements, the appellant was constrained to terminate its dealership in December, 2012. Thus, there was no role or any involvement of the appellant in the alleged fraud played by 2^nd respondent and more over the police authorities have concluded that the appellant is not connected in the fraud committed by 2^nd respondent. Hence, the appellant prayed to set aside the impugned order of the District Forum.

            5. According to 1^st respondent/complainant, the order of the District Forum was duly served to the appellant and 2^nd respondent, but, they neither settled the matter nor preferred any appeal. So, the respondent No.1/complainant filed Execution Application before the District Forum. Only then, aggrieved by the order, the appellant filed this appeal. The appellant and the 2^nd respondent wantonly failed to contest the matter before the District Forum and were set exparte. Further, they have not explained any reason for not contesting the matter in this appeal and no evidence has been adduced, except pleading that they could not appear and contest before the District Forum due to human error.  

            6. The appellant stated that the 2^nd respondent was an erstwhile dealer and that the relationship between them was of principal to principal basis. According to 1^st respondent/complainant, the use of the word ‘erstwhile dealer’ would itself mean that the 2^nd respondent was once a dealer of the appellant. Hence,  the 2^nd respondent is a dealer of the appellant.  Further, the appellant stated in para ‘H’  of the grounds of appeal that “the appellant had been asking respondent No.2 to furnish its statement of accounts with regard to the booking of the motorcycle. The dealership was terminated in December, 2012 as the second respondent was not acting in accordance with the dealership norms and requirements” This clearly shows that the 2^nd respondent was a dealer of the appellant and to that extend there exist and agreement between them at the time of booking of the motorbike by the 1^st respondent/complainant.   In “Letter of Intent” dated.05.06.2010 the appellant mentioned that to appoint you as our Authorised Dealer for our products for sales, service and spare parts for Puducherry.”  which clearly shows that the 2^nd respondent is the dealer of the appellant. Again, in the same Document, the words used by the appellant are “the Letter of Intent is being given on the explicit commitments given by you”  Again at page 2 para 4, the words used by the appellant are “visit your dealership for inspection” This shows the relationship between the appellant and 2^nd respondent as manufacturer and the dealer.. .

            7. On the appellant’s side, the judgment of Hon’ble National Commission (2009) 2 CPR (NC) 391 has been filed wherein Dealership Agreement showed that the relationship between the dealer and petitioner was of  principal-to-Principal basis. The manufacturer could not be held liable for the acts and omissions of the dealer.

            8. In the above judgment  the dealership agreement was that of principal-to-principal basis between the dealer and the petitioner. In the case on hand,  there is a dealership agreement between the appellant and second respondent and thus the above decision will not apply in the present case.  Hence, the above decision cannot be taken into consideration for deciding the present case.

            9. The appellant and the respondents were duly served notice by the District Forum but, they failed to contest the case and were set exparte. The order of the District Forum was also served on these parties, but, they failed to settle the matter. Only when  the E.P. notice was issued, they have come forward to contest the matter before this Commission.  The grounds for their failure to contest before the District Forum have been stated as “owing to a human error committed by one of their representatives”.  The grounds pleaded by the appellant  for not contesting the issue before District Forum  is on a flimsy ground which has not been explained in detail by the appellant. Though this Commission has observed this, we felt, a fair chance should be given to the appellant to put forth his case and to render justice.  Hence, this Commission heard in detail the arguments of the learned counsel for the appellant.  We feel there is no merit in the appeal filed by the appellant as mentioned in the above para 6.

            10. The Letter of Intent, dated 05.06.2010 issued by the appellant to 2^nd respondent explicitly expose the dealership agreement between the two parties and that the 2^nd respondent is purely a dealer of the appellant. The appellant failed to furnish the agreement details between them and 2^nd respondent which is nothing but suppression of fact and has adverse effect on their part.

            11.  It is seen that the vehicle was booked on 10.09.2012 for Rs.50,000/- under Ex.C1, whereas the appellant mentioned in the grounds of appeal that “respondent No.2 was not acting in accordance with dealership norms and requirements, and hence the appellant was constrained to terminate its dealership in December, 2012” The above statement made by the appellant shows that the dealership agreement was terminated in December 2012 whereas the appellant had booked the motorbike on 10.09.2012 which was during the dealership period. Hence, the appellant squarely is responsible for all the omissions and commissions committed during the dealership period. Moreover, a consumer with faith in the product of the appellant had booked the motorbike through its dealer and it is not fair to leave the customer in lurch after taking an amount of Rs.50,000/- who had paid with the fond hope of getting the product from its dealer.

            12. The 3^rd respondent who is the subsequent dealer of the appellant, has no role to play in the deal and he is not a proper party to the proceedings in this case. Hence, there is no liability on the part of 3^rd respondent.

            13. The order of the District Forum is partially modified.. The 2^nd respondent is entitled to get back Rs.50,000/- paid on 10.09.2012 with interest at 12% p.a.  Regarding the cost, the District Forum has awarded Rs.5,000/- on 18.09.2014. After that the consumer has to wait again one and half year, to come into effect the order of the District Forum by preferring this appeal by the appellant. Hence, the cost of the proceedings has to be enhanced to Rs.25,000/- to render justice.

14. Since deficiency in service and unfair trade practice is proved on the part of appellant and 2^nd respondent, they are directed to pay jointly and severally

(i) Rs.50,000/- (Rupees Fifty-Thousand only) being the cost of the motorbike with interest at 12% p.a. from 10.09.2012 till realization and

(ii) Rs.25,000/- (Rupees Twenty-Five Thousand only) towards cost of proceedings. The amount shall be payable within one month from the date of this order.

Dated this the 13^th day of April, 2016

(Justice K.VENKATARAMAN)

PRESIDENT

(K.K.RITHA)

MEMBER