Chandigarh

DF-I

CC/153/2017

Mr. Shivendra Swaroop - Complainant(s)

Versus

Kapsons Fashion Pvt. Ltd. - Opp.Party(s)

Ravi Inder Singh

30 May 2017

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-I, U.T. CHANDIGARH

============

Consumer Complaint  No	:	CC/153/2017
Date  of  Institution	:	16/02/2017
Date   of   Decision	:	30/05/2017

 

 

 

 

 

Shivendra Swaroop, Resident of House No.25, Sector 3, Chandigarh.

……… Complainant.

Versus

 

[1]  Kapsons Fashion Pvt. Ltd., SCO 104-105, Sector 17-C, Chandigarh, through its Store Manager.

 

[2]  Tommy Hilfiger Arvind Fashion Pvt. Ltd., No.4, Brunton 1^st Cross Road, Bangalore – 560025, through its General Manager (Sales)/authorized representative.

 

……. Opposite Parties

 

BEFORE:   SH. SURJEET KAUR             PRESIDING MEMBER

          SH. RAVINDER SINGH           MEMBER

 

For Complainant	:	Sh. Inder Singh, proxy counsel for Sh. Ravi Inder Singh, Advocate.
For Opposite Parties	:	Ex-parte.

 

PER SURJEET KAUR, PRESIDING MEMBER

 

          Put in brief, the facts of the case are that on 26.01.2016, the complainant visited the outlet of the Opposite Party No.1. In order to promote the sale of their products, the Opposite Parties had offered flat 40% discount on MRP. The complainant purchased one Ladies Sweater from the Opposite Party No.1 which was having MRP of Rs.5499/-. The Opposite Party No.1 demanded an amount of Rs.3464.37/- which included Rs.164.97/- as VAT @ 5% [Cash Memo Annexure P-1]. The complainant raised objection relating to charging of extra VAT as the cost of the Sweater was inclusive of all taxes and VAT had already been added to the said cost, but, to no avail. The complainant has alleged that the Opposite Parties had adopted unfair trade practice by charging extra VAT from him. Hence, alleging the aforesaid act & conduct of the Opposite Parties as deficiency in service and unfair trade practice, the Complainant has filed the present Complaint.

 

2.          Notice of the complaint was sent to Opposite Parties seeking their version of the case. However, nobody appeared on behalf of Opposite Parties, despite service, therefore, they were proceeded ex-parte.

 

3.          Complainant led evidence.

 

4.          We have heard the learned proxy counsel for the Complainant and have also perused the record.   

 

5.          The case of the Complainant is that he was charged extra VAT @5% for the Sweater with MRP of Rs.5499/- (which was inclusive of all taxes) after giving a discount of 40%.

 

6.          Significantly, the Opposite Parties did not appear to contest the claim of the complainant and preferred to proceed against ex-parte. This act of the Opposite Parties draws an adverse inference against them. The non-appearance of the Opposite Parties shows that they have nothing to say in their defence against the allegations made by the complainant. Therefore, the assertions of the complainant go unrebutted & uncontroverted.

 

7.          Now, the core question which survives for determination is whether the MRP includes all taxes including VAT and whether after discount VAT can be charged or not?  

 

8.          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 if VAT is included in MRP. 

 

9.          At any rate, if the Opposite Parties have offered discount of 40% for an article purchased by the Complainant/Customer, then they are bound to sell the article after discount. Though the Opposite Parties had offered 40% discount on the article in question, still they charged 5% extra VAT on discounted price inspite of specific mention on the tag MRP inclusive of all taxes (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.

 

10.        A similar question arose for determination before the Hon’ble State Consumer Disputes Redressal Commission, U.T. Chandigarh in First Appeal No. 210 of 2015, decided on 01.09.2015 in case titled as “Shoppers Stop and others Versus Jashan Preet Singh Gill and Others”, wherein it has been held 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.

 

11.        In Revision Petition No. 3477 of 2016 titled as “M/s Aero Club (Woodland) Versus Rakesh Sharma”, decided on 04.01.2017, along with other connected Revision Petitions No.3479 to 3483 of 2016, the Hon'ble National Consumer Disputes Redressal Commission, has held that any discount falling short of “Flat 40%” on the MRP would amount to unfair trade practice, as defined in the Act.  

 

12.        The ratio of the aforecited judicial pronouncements are squarely applicable to the present lis. Therefore, the act of the Opposite Parties in charging VAT on discounted product, clearly proves deficiency in service on their part, which certainly caused immense mental and physical harassment to the Complainant. 

 

13.        For the reasons recorded above, the present complaint of the Complainant deserves to succeed against the Opposite Parties, and the same is allowed. The Opposite Parties are, jointly & severally, directed:-

 

[a]  To refund excess charged VAT of Rs.164.97/- to the Complainant;

 

[b]  Pay Rs.2,000/- as compensation on account of deficiency in service and causing mental and physical harassment to the Complainant; 

 

[c] Pay Rs.1,000/- towards costs of litigation;

 

14.        The above said order shall be complied within 30 days of its receipt by the Opposite Parties; thereafter, they shall be liable for an interest @9% per annum on the amounts mentioned in sub-paras [a] & [b] above from the date of institution of this Complaint, till it is paid, apart from costs of litigation mentioned in sub-para [c] above. 

 

15.        Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced

30^th May, 2017                                             

Sd/-

(SURJEET KAUR)

       PRESIDING MEMBER

 

Sd/-

(RAVINDER SINGH)                                                                                                      MEMBER