PER SHRI. S.B.DHUMAL - HON’BLE PRESIDENT :
1) In brief consumer dispute is as under –
The Complainant is a Public Limited Company, registered under the Companies Act, 1956. Opposite Party is a Company engaged in the business of providing services of Merchant Banking and is a CAT – I Merchant Banker for Capital Market related activities.
2) The Complainant had personal discussion with Opposite Party regarding proposed Right Issue of shares of the Complainant Company sometime in Dec., 2006. In pursuant to the discussions, the Opposite Party had sent a detailed proposal alongwith their letter dtd.04/12/2006. The fee agreed was at Rs.10 Lacs on the basis of scope of assignment as per the said proposal letter dtd.04/12/06. The Complainant had given advance payment of Rs.1 Lac, vide Cheque No.564429, dtd.19/01/07 to the Opposite Party.
3) In furtherance of the above arrangement the Complainant had submitted copy of its audited accounts for the year ending 31/03/2002 to 31/03/2007 to the Opposite Party under cover of letter dtd.14/02/2007. But there was no progress in the matter so the Complainant addressed letter dtd.09/04/08 requesting Opposite Party to provide list of details required for the Right Issue and also informed the Opposite Party about the change of address.
4) It is submitted that since there was no response from the Opposite Party, the Complainants on telephone requested Mr. Pradeep Vaidya, Secretary of Opposite Party to arrange for necessary list of requisite document. The Complainant had reminded the Opposite Party by letter dtd.14/04/08 to send the required details for Right Issue. Then the Opposite Party by its fax informed the Complainant that the proposed Right Issue has been referred to the practicing Company Secretary - Mr.V.K. Mishra and Opposite Party was expecting a reply. Thereafter, there was no response from the Opposite Party. Therefore, by fax message dtd.22/04/2008, the Complainant requested the Opposite Party to take the matter seriously and further informed that if no details are received by the next day i.e. 23/04/08, the Complainant will be looking for alternate arrangement and hence the Opposite Party will be required to refund the advance of Rs.1 Lac paid by the Complainant. Finally the Complainant vide their letter dtd.03/08/09 asked the Opposite Party to refund advance payment of Rs.1 Lac as there was no positive action from the Opposite Party. There was no response to the said letter from the Opposite Party. Then the Complainant issued legal notice dtd.12/11/2009 calling upon Opposite Party to refund advance payment of Rs.1 Lac with interest @ 18% p.a. till the date of payment within 21 days from the date of receipt of the said notice. Opposite Party neither refunded the amount nor responded the said notice. It is submitted that the conduct of the Opposite Party amounts to deficiency in service and therefore, the Complainant has filed this complaint before this Forum.
5) The Complainant has prayed to declare that Opposite Party is guilty of deficiency in services. Further, the Complainant has prayed to direct Opposite Party to pay to the Complainant an amount of Rs.1 Lac towards the refund of fees with interest @ 18% p.a. from 19/01/07 till the date of payment. The Complainant further requested to direct Opposite Party to pay to the Complainant compensation of Rs.5 Lacs for the hardship, loss of reputation and inconvenience caused to the Complainant. The Complainant has also prayed for cost of this complaint. Dr. Satya Prakash Jaiswal, Manager of Complainant’s Company has filed affidavit in support of the complaint. The Complainant has produced documents as per list of documents.
6) The Opposite Party has filed written statement and thereby resisted claim of the Complainant contending interalia that complaint is bad in law and deserves to be dismissed with cost.
7) Opposite Party has admitted correctness of the contents of complaint para No.1, 2 & 3. However, according to the Opposite Party, the Opposite Party has agreed to provide professional services against professional fee of Rs.11 Lacs and the Complainant has wrongly stated that agreed fee as Rs.10 Lacs. It is admitted that the Complainant submitted audited account for the year 2002-2007. However, the Complainant did not furnish remaining details though assured under letter dtd.14/02/07. It was informed by the Complainant that the documents are under preparation. Complainant never furnished said documents to the Opposite Party. Opposite Party could not proceed further as necessary documents were not provided to the Opposite Party. Opposite Party had informed the Complainant their paid up capital should be raise Rs.10 Crores or above and advised the Complainant to raise paid-up capital from Rs.25 Lacs to minimum of Rs.10 Crores, but the Complainant have not taken any steps to raise paid-up capital. Before going for Right Issue the Company should have minimum number of Shareholders to qualify for the Right Issue which has not been complied by the Complainant inspite of telephonic reminder and discussion. The Complainant was changing its address from time to time without informing to the Opposite Party.
8) It is alleged that the Complainant had deliberately suppressed the material facts from this Forum. The advance payment of Rs.1 Lac paid by the Complainant towards part professional fee was utilized for rendering services to the Complainant. Hence, the Complainant is not entitled to recover the said amount. It is contended that complaint is barred by law of limitation.
9) According to the Opposite Party, Complainant is not a ‘Consumer’ and therefore, provisions of Consumer Protection Act, 1986 are not applicable to the present case and the complaint deserves to be dismissed with cost.
10) The Complainant has filed rejoinder and thereby denied allegations made in the written statement. The Complainant has filed written argument. We heard oral submissions of Ld.Advocate MR. R.J. Baddan h/f Ld.Advocate Mr. Ajay Panicker for the Complainant and Mr. K. Damania, Representative for the Opposite Party.
11) Following points arises for our consideration and our findings thereon are as under -
Point No.1 : Whether the Complainant is a Consumer as defined under Sec.2(1)(d)(ii) of the Consumer Protection Act ?
Findings : No
Point No.4 : Whether the Complainant is entitled to reliefs as prayed for ?
Findings : No
Reasons :-
Point No.1 :- Following facts are admitted fact that that the Complainant is a Public Limited Company, registered under the Companies Act, 1956. Opposite Party is also a Private Ltd. Company, engaged in the business of providing services of Merchant Banking and is a CAT – I Merchant Banker for Capital Market related activities. The Complainant had hired services of the Opposite Party sometime in December, 2006 for Proposed Right Issue of shares and has paid Rs.1 Lac as an advance payment by cheque dtd.19/01/07 towards the agreed professional fees of the Opposite Party.
It is submitted on behalf of the Complainant that the Complainant is a ‘Consumer’ within the definition of Sec.2(1)(d)(ii) of the Consumer Protection Act. According to the Complainant’s Advocate, the Complainant had hired services of the Opposite Party for Proposed Right Issue and not for commercial purpose. The Opposite Party has not provided services as agreed nor refunded the advance amount paid by the Complainant and therefore, there is deficiency in service on the part of Opposite Party.
In the written argument the Complainant relied upon the decisions of the Hon’ble Supreme Court and the Hon’ble State Commission, but the decision relied by the Complainant are not relevant to decide issue as to whether the Complainant is a ‘Consumer’ under the Consumer Protection Act. The decision relied upon by the Complainant are on the point of limitation, deficiency in service, etc.
Representative of Opposite Party has referred to the amended provisions of Sec.2(1)(d)(ii) of the Consumer Protection Act, submitting that after amendment of 2002, a person who avails services for commercial purpose is excluded from the definition of ‘Consumer’. In the instance case, the Complainant is the Public Ltd. Co. It was proposed for Right Issue of shares and for that purpose the Complainant had availed services of the Opposite Party. The Complainant is a Ratan Glitter Industries and for enhancing capital there was proposal of Right Issue which is a paid and parcel commercial activity. As the Complainant has availed services of Opposite Party for commercial purpose, the Complainant is not a ‘Consumer’ and therefore, complaint deserves to be dismissed with cost.
By the Amendment Act of 2002, Sec.2(1)(d)(ii) of the Consumer Protection Act, was amended. By the aforesaid amended a person who availed services for commercial purpose is excluded from the definition of consumer. In this case, sometime in December, 2006, if the Complainant availed services of the Opposite Party for proposed Right Issue of shares to enhance its capital. So it is clear that the Complainant has availed services of Opposite Party for commercial purpose and therefore, in view of amendment provision of Sec.2(1)(d)(ii), the Complainant is not a ‘Consumer’. Hence, we answer point no.1 in the negative.
Point No.2 :- As discussed the Complainant is not a Consumer under Sec.2(1)(d)(ii) of the Consumer Protection Act, therefore, present complaint is not a consumer complaint and as such, the Complainant is not entitled to seek any relief from this Consumer Forum. Hence, point no.2 is answer in the negative.
For the reasons discussed above, complaint deserves to be dismissed. Hence, we pass following order -
O R D E R
i.Complaint No.27/2010 is dismissed with not order as to cost.
ii.Certified copies of this order be furnished to the parties.
