DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)
Consumer Complaint No.1083 of 2017
Date of institution: 19.12.2017 Date of decision : 11.10.2018
Bharti Singla wife of Shri Vijay Singla, resident of House No.1815, Nirvana Society, Sector 49-B, Chandigarh.
…….Complainant
Versus
Lifestyle International Pvt. Ltd. through its concerned Manager, North Country Mall, National Highway 21, Mohali-Kharar Road, Mohali.
……..Opposite Party
Complaint under Section 12 of
the Consumer Protection Act.
Quorum: Shri G.K. Dhir, President,
Mrs. Natasha Chopra, Member.
Present: Shri Karan Singla, counsel for the complainant.
Shri Saurabh Gulia, counsel for the OP.
Order by :- Shri G.K. Dhir, President.
Order
Complainant purchased 5 articles from OP having MRP of Article No.1 Rs.1,499/-; of Article No.2 Rs.399/-; of Article No.3 Rs.999/-; of Article No.4 Rs.1,499/- and of Article No.5 Rs.2,599/-. There was no discount on Article No.3 and 4. However, discount of 30%, 10% and 40% respectively was offered for Article No.1, Article No.2 and Article No.5, due to which discounted payable price of the purchased articles was Rs.1049.30 N.P.; Rs.359/- and Rs.1,599/- for articles No.1, 2 and 5. Further Rs.148/- was charged as tax from complainant and that is why she had to pay Rs.5,617/- on this purchase effected on 14.07.2017 through invoice. Charging of tax on the discounted price alleged to be an unfair trade practice and that is why this complaint filed for seeking refund of the extra paid amount of Rs.148.40 N.P. alongwith compensation for mental harassment and agony of Rs.50,000/- but litigation expenses of Rs.10,000/-.
2. In reply filed by OP, it is pleaded inter alia as if complaint is false, frivolous and vexatious being filed without any cause of action and is not maintainable due to missing of ingredients of Section 2 (c) of the Consumer Protection Act. Perusal of invoice shows that OP had given discount on MRP of the products and has charged only a portion of the applicable tax on the discounted price. Major portion of the tax has been borne by the OP. GST has been charged on the transaction and thereafter the same deposited with the concerned department as per mandate of law. Indirect tax regime has travelled from VAT to GST resulting in increase of said tax from 5% to 12%. However, to keep customers unaffected, tax at the old VAT rate of 5% has been charged, but rest 7% paid by OP from its pocket to the concerned department. Total tax valuation mentioned on the invoice is Rs.519.62 N.P., but complainant paid only Rs.148.4 N.P. Matter in question relates to taxation and as such this Forum alleged to be having no jurisdiction. OP has not charged any GST separately and the total amount collected from the complainant is less than MRP valuation mentioned in the price tags. Admittedly discount of 30%, 10 and 40% on articles No.1, 2 and 5 was offered. Offer of discount was widely advertised and displayed on the Lifestyle Store for giving notice of charging of tax to the customers. As the tax charged as per rules and as such allegation of deficiency in service denied, but by claiming that sale price defined under Central Sales Tax Act and Punjab VAT Act, 2005 means the amount payable to a dealer as consideration for sale of any goods, less any sum allowed as cash discount according to the practice normally prevailing in the trade. OP is entitled to charge and collect GST after deducting discount from the printed MRP and the same to be taken as sale price. On the advertisement of discount offer, it was clearly mentioned “Tax Extra”. Complainant might have missed to notice this fact. In case complainant was not agreeing with the OP for charging tax, then the invoice could have been got cancelled, but complainant choose to raise no concern in that respect and as such complaint alleged to be filed with malafide intention and for unjust enrichment. By denying other allegations of the complaint , prayer made for dismissal of the complaint.
3. Complainant to prove her case tendered in evidence her affidavit Ex.CW-1/1 alongwith document Ex.C-1 and thereafter her counsel closed evidence. On the other hand, counsel for the OP tendered in evidence affidavit Ex.RA of Shri Baljit Talwar, authorised signatory of the OP alongwith documents Ex.R-1 and Ex.R-2 and thereafter closed evidence.
4. Written arguments not submitted by any of the parties. Oral arguments heard and records gone through.
5. It is admitted case of OP that discount @ 30%, 10% and 40% on article No.1, 2 and 5 was offered and thereafter tax of amount of Rs.148.40 N.P. collected from complainant, out of total realizable CGST/SGT of Rs.519.62 N.P. That fact is borne from contents of invoice Ex.C-1. Admittedly MRP was inclusive of all taxes and as such certainly amount of Rs.148.40 N.P. has been collected by OP from complainant on the discounted price. Even if OP may have to bear 7% of the collected GST amount and complainant had to pay only 5% of the chargeable tax, despite that one thing is clear that actually Rs.148.40 N.P. has been collected by OP from complainant as tax on the discounted price. 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.
6. 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 OP itself who professed that MRP will be inclusive of all taxes and as such on the discounted price, OP by such undertaking bound to pay taxes. Complainant on representation of OP of discount offer on product having MRP inclusive of all taxes, purchased the products in question from OP and as such now OP estopped by its 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.
7. Provisions of Sales Tax Act or VAT Act 2005 stands on different footing than that of beneficial provisions of Consumer Protection Act. Assessment of turnover of a trader for purpose of sales tax to be done under the provisions of taxation provisions for collecting revenue for the State, but under the garb thereof benefit of beneficial provisions of Consumer Protection Act cannot be denied to the consumers. So even if there may be responsibility of OP to collect tax on the sold products, but despite that it is bound by its open offer of not charging tax extra on the products having MRP inclusive of all taxes.
8. It is also contended by counsel for the OP that GST is indirect tax which is bound to be collected by the vendor from the purchaser for depositing the same in the Govt. Department and as such no unfair trade practice adopted by the OP, particularly when as per display by the OP, the tax to be charged extra on the discounted price. Reliance on Ex.R-1 and Ex.R-2 is placed to show that on the discounted price, tax to be charged extra as per display given by OP in its advertisement. So long as the law laid down by Hon’ble National Commission in case M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma is not set aside, the same to govern the field qua pending cases or the cases to be decided by the Consumer Forums. Being so, the decision given by Sales Tax Authorities is not to apply to such like consumer complaints. So benefit from the ratio of case Deputy Commissioner of Sales Tax (Law), Ernakulam Vs. Advani Oorlikon (P) Ltd., AIR 1980 SC 609 cannot be gained by counsel for the OP because benefit of ratio of that case available when an assessment of the turnover of the assessee for the purpose of sales tax collection to be made. In this case before us, provisions of Sales Tax Act have no relevancy because no assessment for computation of assessee’s turnover is to be done. So certainly, the complaint is maintainable and complainant on account of suffered mental agony and harassment entitled for compensation and also to litigation expenses, but to reasonable amount.
9. Though it is contended that advertisements like Ex.R-1 and Ex.R-2 displayed for notice of consumers that tax to be charged extra on the discounted price, but there is nothing on the record to suggest as to at which conspicuous place of OP’s show room, such advertisement was put and as such virtually due notice of the scheme of charging extra tax on discounted price is not given to complainant. It is the claim of complainant put forth in the complaint as well as in the submitted affidavit Ex.CW-1/1 that she raised protest regarding charging of extra tax on the discounted price of the products having MRP inclusive of all taxes and as such it is not a case in which complainant paid tax on the discounted price without protest.
10. As a sequel of above discussion, the complaint is allowed with direction to OP to refund excess charged amount of Rs.148.40 N.P. with interest @ 6% per annum w.e.f. 14.07.2017 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 OP. 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
October 11, 2018.
(G.K. Dhir)
President
(Mrs. Natasha Chopra)
Member
