DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)

Consumer Complaint No.695 of 2017

                                                     Date of institution:  07.09.2017                                                 Date of decision   :  14.06.2018

Kulvinder Kaur @ Kulbinder Kaur, aged 45 years wife of Shri Ajinder Singh, resident of House No.1712, Sector 49, Chandigarh.

…….Complainant

Vs

1.     Lakshita Fashions Pvt. Ltd., SSS No.80, Phase-3B2, SAS Nagar, Mohali, Punjab through its Manager/Authorised Signatory.

2.     Lakshita Fashions Pvt. Ltd., Shop No.203, Floor No.2, Elante Mall, Plot No.178-178-A, Industrial & Business Park, Phase-1, Chandigarh through its Manager/Authorised Signatory.

                                                                    ……..Opposite Parties

Complaint under Section 12 of

the Consumer Protection Act.

Quorum:   Shri G.K. Dhir, President,

                Ms. Natasha Chopra, Member.

Present:    Ms. Hemlata Issar, counsel for complainant.

                Shri Sunny Deep Joneja, counsel for the OPs.

Order by :-  Shri G.K. Dhir, President.

Order

               Complainant purchased some items vide cash memos dated 08.01.2017 and 04.02.2017 by paying amount of Rs.1,571/- and Rs.2,759/- respectively. MRP of the purchased products was Rs.1,995/-; Rs.995/-; Rs.995/-; and Rs.2,295/-. After discount, value of the purchased products was Rs.1,496.25 N.P.; 497.50 N.P.; Rs.497.50 N.P. and Rs.1,606.50 N.P.. Total payable price of all the purchased items as such was of Rs.4,097.75 N.P., but OP charged Rs.4,330/-. VAT @ 5% and 6.05% extra was charged on the purchased items, despite the fact that MRP was inclusive of all taxes. By claiming that OPs adopted unfair trade practice, this complaint filed for seeking refund of the extra charged amount of Rs.233.25 N.P. with rate of interest @ 18% per annum. Compensation of mental harassment and financial loss of Rs.20,000/-, but litigation expenses of Rs.10,000/- claimed.

2.             In joint reply filed by OPs, it is admitted that discount was offered on the purchased items, but as per practice prevailing the VAT is generally charged extra on the discounted price. Admittedly the goods were purchased by complainant under discount scheme. In view of availing of discount scheme, the complainant went out of ambit of MRP. Concept of MRP applicable on fresh stocks and not on the discounted price items. No unfair trade practice adopted by OPs because the collected VAT has been deposited with the concerned department and has not been pocketed by OPs.  Computerized bill was generated without any manipulation and as such complaint prayed to be dismissed.

3.             Counsel for complainant tendered in evidence Ex.CW-1/1, affidavit of complainant alongwith documents Ex.C-1 to Ex.C-4 and thereafter counsel closed evidence. On the other hand counsel for OPs tendered in evidence Ex.OP-1/1 affidavit of Shri Sachin Kharbanda, representative of OPs and then closed evidence.

4.             Written arguments not submitted by any of the parties. Oral arguments heard and records gone through.

5.             It is specifically pleaded in Para No.4 and 5 of the complaint that MRP of the purchased products was inclusive of all taxes and that fact has not been denied at all by the OPs in the filed written statement. Whatever is specifically pleaded, but not denied, the same to be taken as admitted by the party not denying the same. So in view of these pleadings, it is obvious that MRP of the purchased products through invoices Ex.C-1 and Ex.C-2 was inclusive of all taxes.

6.             Perusal of bill Ex.C-1 reveals that MRP of the product purchased through this bill dated 08.01.2017 was Rs.1,995/- on which discount of Rs.498.75 N.P. was given for claiming amount of Rs.1,496.25 N.P. However, VAT of amount of Rs.74.81 N.P. charged on the discounted price through Ex.C-1. Perusal of invoice Ex.C-2 shows that MRP of three products purchased was Rs.995/-; Rs.995/- and Rs.2295/-. Discount of amounts of Rs.497.50 N.P.; Rs.497.50 N.P.; and Rs.688.50 N.P. was given on these three products for charging amounts of Rs.497.50 N.P.; Rs.497.50 N.P. and Rs.1606.50 N.P. So total payable discounted price was Rs.2,601.50 N.P. However, VAT @ 6.05% of total amount of Rs.157.39 N.P. charged on these three products through Ex.C-2 for claiming Rs.2,759/- from complainant. Both OP concerns has their show room/office at Mohali and as such this Forum has territorial jurisdiction. From contents of invoices Ex.C-1 and Ex.C-2 referred above, it is made out that VAT of amount of Rs.74.81 N.P. + Rs.157.39 N.P. = Rs.232.20 N.P. charged by OPs from complainant on the discounted price. As VAT has been charged on discounted price of items having MRP inclusive of all taxes, and as such certainly OPs adopted unfair trade practice.  Practice of charging extra VAT/GST on the discounted price certainly is unfair trade practice because the same 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.

6.             It is vehemently contended by counsel for OPs that VAT charged has not been pocketed by OPs, but deposited with the Govt. and as such no unfair trade practice adopted by OPs. That submission of counsel for OPs has no force because when offer of not charging tax on products having MRP inclusive of all taxes given by the seller, then the seller bound by his commitment. There is no material produced on record to show that complainant was disclosed about charging of VAT extra on the discounted price. When notice of charging VAT extra on the discounted price not given by OPs to complainant, then certainly OPs bound by their offer of not charging any taxes on the products having MRP inclusive of all taxes. That in fact is the ratio of law laid down in above cited cases. So even if OPs may have deposited the collected VAT amount in Govt. treasury, despite that liability of paying the same remains of OPs because of their open offer of not charging VAT or any other taxes on products having MRP inclusive of all taxes. Provisions of VAT Act meant for collecting revenue for the State and not for denying the contractual benefit to buyers. So in view of contractual obligation undertaken by OPs to not to charge taxes on products having MRP inclusive of all taxes, obligation remains of OPs to pay VAT or any other taxes. However, that tax/VAT collected from complainant by adopting unfair trade practice and as such complainant entitled to reasonable amount of compensation for mental agony and harassment and also to litigation expenses.

7.             As a sequel of above discussion, complaint allowed with direction to OPs to refund excess charged amount of Rs.232.20 N.P. with interest @ 6% per annum w.e.f. 04.02.2017 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

June 14, 2018.

                                                                (G.K. Dhir)

                                                                President

                                                       (Ms. Natasha Chopra)

Member