1.       Challenge in these three Revision Petitions, under Section 21 (b) of the Consumer Protection Act, 1986 (for short “the Act”), by the Manufacturer, viz.  Hyundai Motors India Ltd.; the Dealer, Viz. M/s Samara Hyundai and the Complainant, is to the order, dated 22.02.2013,  passed by the Delhi State Consumer Disputes Redressal Commission at New Delhi (for short “the State Commission”) in First Appeals No. 145 and 188 of 2010, filed by the Dealer and the Manufacturer respectively. The said Appeals had been preferred against the order, dated 20.01.2010, passed by the District Consumer Disputes Redressal Forum, Qutub Institutional Area, New Delhi (for short “the District Forum”) in Complaint Case No. 599 of 2008.  By the impugned order, the State Commission has affirmed the said order and has, thus, dismissed both the Appeals.

2.       In so far as the District Forum was concerned, while allowing the Complaint filed by the Complainant, alleging unfair trade practice and deficiency in service on the part of the Manufacturer as well as the Dealer in selling to her a defective vehicle, viz. Hyundai Verna Diesel Passenger Car (Model Verna GL 1.5 CRDI VGT-New E3 Real Earth), it had directed both of them to jointly and severally replace the vehicle with a new one, after getting it inspected by the Complainant or in the alternative to pay to her a sum of ₹7,88,413/-, being the cost of the vehicle along with a sum of ₹50,000/- as compensation for the mental agony, harassment caused to her and cost of litigation.

3.       Since all the three Petitions, arise out of a common order, between the same parties, these are being disposed of by this common order. 

4.       Almost a decade ago, more precisely on 02.06.2008, the Complainant purchased the afore-stated vehicle from the Dealer for a total sale consideration of ₹7,88,413/-, by raising loan of ₹5,00,000/- from the Bank.  According to the Complainant, she was assured that before the vehicle is delivered to her, she and her son would be allowed to inspect and test drive the same, but on the pretext that as the car had been received from Manufacturer with a Pre-Delivery Inspection (PDI) Certificate, they were not permitted to inspect or test drive it.  However, after taking the delivery of the said vehicle, when her son drove the vehicle to the house, it was found that the it was pulling towards the left side and there was some cracking sound while turning the steering.  There was noise in the paddle as well.  On being advised by the Dealer, on 07.06.2008, the Complainant’s son took the vehicle to the workshop of the Dealer but the problem could not be rectified.  He was asked to take back the vehicle, with the assurance that it would be picked up by the driver of the Dealer in the next week, when an expert from the Manufacturer would be available. Accordingly, on 12.06.2008, an employee of the Dealer picked up the car from the Complainant’s residence with the assurance that the same would be delivered back in 2-3 days.  However, on the same day, when the car was being driven by the driver of the Dealer for being delivered to the Complainant, it met with an accident, badly damaging the left side of the car, including the doors, running board, front mudguard etc. The driver took the vehicle back to the workshop. After inspection of the vehicle on the next day i.e. 13.06.2008, when the Complainant visited the workshop and  wanted to discuss the entire episode with the senior functionaries of the Dealer, she could not meet them. On 17.06.2008, she lodged complaint with the Customer Care Department of the Dealer.  Having failed to elicit any positive response to her complaints as also to the legal notice and left with no other option, she filed a complaint in the District Forum, seeking a direction to the Manufacturer and the Dealer to replace the car with a new one of the same model or in the alternative refund the full price of the car i.e. ₹7,88,413/- along with interest @ 18% p.a. and to compensate for rendering deficient services; along with the cost of litigation.  We may note at this juncture itself that the vehicle in question remained with the Complainant barely for five days and had run for less than 700 kms, covering the visits to and fro the workshop.  It is stated to be still lying with the Dealer. 

5.       The complaint was contested by the Manufacturer and the Dealer on diverse pleas.  In its separate Written Version, the Manufacturer, pleaded that as per the information obtained from the Dealer, the complainant and her son had duly inspected the vehicle and conducted a test drive and it was only after being fully satisfied with the performance of the vehicle that they had taken its delivery; by no stretch of imagination, the Manufacturer could be held liable for the damage, if any, caused to the car by reason of the accident  on 12.06.2008, when the same was being driven by Dealer’s driver and therefore, it was the Dealer who was solely responsible for the omission/misinformation etc. to the Complainant, as the relationship between a Manufacturer and the Dealer is on principal to principal basis; the vehicle had been repaired by the Dealer free of cost and was lying at his workshop in perfect running condition but despite requests the Complainant had refused to take its delivery and hence there was no deficiency on the part of the Manufacturer. 

6.       In its reply, the Dealer also denied the allegations in the Complaint.  However, while admitting that the Complainant had brought the vehicle with the afore-stated defects; it was averred that its mechanics had checked the car and had found only minor problem in the alignment, which was duly rectified.  So far as the lodging of the Complaint for the second time, on 12.06.2008, is concerned, the Dealer pleaded that on receipt of the above Complaint, its employees found that the vehicle was not having any problem and the same was in perfect condition.  However, it was admitted that while taking the vehicle for delivery to the Complainant’s place by its driver, it met with an accident but all the damaged parts having been repaired at its own cost, the Complainant was requested to take delivery of the vehicle, which she refused.  It was pleaded that since the vehicle was being sent to the residence of the Complainant at her request, without charging any extra consideration for the said facility, it could not be held responsible for the negligence of its driver during the transit. 

7.       As afore-stated, vide order, dated 20.01.2010, while allowing the Complaint, the District Forum had found both the Manufacturer as well as the Dealer, guilty of deficiency in service and unfair trade practices and issued the afore-noted directions. 

8.       Being aggrieved, both the Manufacturer and the Dealer carried the matter further in separate Appeals before the State Commission.  However, the Complainant seemed to be satisfied with the said order, in as much, as she did not prefer Appeal against the order of the District Forum. 

9.       As noted above, the State Commission has affirmed the order of the District Forum and has dismissed both the Appeals with costs quantified at ₹20,000/- observing thus:-

“(15). When it is admitted case of the parties that the car delivered to Respondent No. 1 suffered from fault and short coming in the standard claimed by the Appellants, it can be safely held that the vehicle was defective and the Respondent No. 1 cannot be forced to take its delivery after repairs even for free of cost.  The defect as pointed out by Respondent No. 1 immediately at the time of delivery may not constitute “manufacturing defect” as claimed by the Appellants, yet it would not satisfy a customer, may be one amongst thousands like the Respondent No. 1.  We find it bounded duty of the Appellants to deliver to their customers their products free from any fault, imperfection or short coming in the quality or standard which is required of them, when they claim themselves that the cars manufactured by them are highly esteemed and popular not only in India but elsewhere in the world also; that they have craned out a place for themselves in Indian Automobile Industry and are a highly reputed car company.

(16).  There appears to us no reason to disbelieve the version of Respondent No. 1, when she states in her complaint before the District Forum that “prior to purchase of the vehicle OP No. 2 told the complainant that son of the complainant would be allowed to make an inspection and test drive prior to final selection and delivery of the vehicle; that, the complainant prior to completion of formalities of sale repeatedly requested OP No. 2 for inspection and test drive of the vehicle as promised but one of the Employees/Agent namely Sh. R.K. Arora instead of permitting the complainant to have an inspection and test drive told the complainant that the vehicle had been received from OP No. 1 along with PDI (Pre-delivery-inspection) and there was no need for test drive as it had already been tested by the competent Engineer of OP No. 1 and on this assurance of Sh. R.K. Arora, the complainant took the delivery of the vehicle after completion of requisite formalities.”

(17). Subsequently, finding the vehicle pulling towards left side and giving crackling sound while turning, in the steering and peddle immediately after delivery, amounts to Unfair Trade Practice which means a trade practice which for the purpose of promoting sales, use or supply of any goods or for the provision of any services adopts any unfair method or unfair or deceptive practice falsely representing that the goods or services are of a particular standard, quality or grade (Section 2(1)(r) of the Act).”

10.     Hence, these Revision Petitions.  In their Revision Petitions, the Manufacturer and Dealer pray for setting aside of the afore-stated directions by the Fora below, whereas the Complainant, in her Revision Petition, prays for enhancement of compensation. 

11.     We have heard Learned Counsel for the parties and have perused the documents on record.

12.     In so far as the Revision Petition (No. 3102/2013) preferred by the Complainant is concerned, the Complainant had neither challenged the order passed by the District Forum nor did she make any prayer for enhancement of compensation before the State Commission. Thus, the Complainant being satisfied with the relief granted to her by the District Forum, is now estopped from raising the question of quantum of the compensation, at this juncture. The present Revision Petition is an after-thought and more in the nature of pre-emptory exercise in the other two Revision Petitions, filed by the Manufacturer and the Dealer. Consequently, we decline to entertain the said Revision Petition and dismiss the same, as being bereft of any merit.  

13.     We may now, advert to the Revision Petitions, filed by the Manufacturer and the Dealer. The questions falling for consideration in these Petitions are: (i) whether the concurrent findings of fact returned by both the Fora below to the effect that there was deficiency in service on the part of both of them as also that they had indulged in unfair trade practice in supplying a defective vehicle to the Complainant, warrant interference; (ii) whether the direction to the Manufacturer and the Dealer to replace the vehicle with a new one or in the alternative refund its cost price, is justified and (iii) whether the Manufacturer or the Dealer can be made liable for the negligence of the driver of the Dealer in extensively damaging the car on account of the accident while taking it for delivery to the Complainant?

14.     The expression “defect” is defined in Section 2 (1)(f) of the Act, which reads as follows:-

          “’defect’ means any fault, imperfection or shortcoming in the quality, quantity, potency, purity or standard which is required to be maintained by or under any law for the time being in force or (under any contract, express or implied, or) as is claimed by the trader in any manner whatsoever in relation to any goods.”

15.     The definition of the word “defect” is very wide. Nevertheless, in order to establish “defect” in the goods, it has to be proved that: (a) there is a fault, imperfection or shortcoming; (b) such fault, imperfection, etc. is in the quality, standard, etc; and (c) which is required to be maintained by or under any law for the time being in force; or (d) which is claimed by the trader in any manner whatsoever in relation to any goods. In the instant case, the mere fact that within a span of two weeks, a brand new vehicle, which had not even run for 1000 kms., including the distance covered for taking it to the workshop twice for rectification of the afore-stated defects, would, prima facie, fall within the ambit of the expression “defect”. Nevertheless, in the peculiar facts of the instant case, more precisely, the accident of the vehicle, the occasion to reach a firm conclusion as to whether or not the vehicle suffered from a manufacturing defect, did not arise. Admittedly, after the second time repair, the vehicle met with an accident at the hands of the driver of the Dealer, resulting in extensive damage to it. After the accident, the vehicle remained with the Dealer and, therefore, there was no material before the Fora below to arrive at the finding that the afore-stated problems in the car, were inherent manufacturing defects, which were not rectified and hence there was deficiency in service and/or unfair trade practice on the part of the Manufacturer and the Dealer, in supplying a defective vehicle to the Complainant. Hence, finding by the Fora below to that limited extent, deserves to be set aside. We hold accordingly.

16.     Having arrived at the said conclusion, the next question for consideration relates to the relevance and significance of the accident of the vehicle at the hands of the Dealer’s driver for determining the liability of the Dealer. Having bestowed our anxious consideration to the peculiar circumstances, viz. the fact that the Complainant had hardly used a brand new vehicle, purchased after raising loan from the Bank, because of the alleged defects/complaints and the accident by Dealer’s driver, we are of the opinion that Dealer’s refusal to replace it and its insistence on the Complainant accepting an accidental brand new vehicle, though repaired free of charge, did amount to deficiency in service on its part. Therefore, direction for replacement of the vehicle or in the alternative refund of its price, by the Fora below against the Dealer, is fully justified. 

17.     The question still surviving for consideration is whether the Dealer could be made liable for the negligence of its employee i.e. its driver.  There being no dispute that the driver was the employee of the Dealer and was driving the vehicle on the direction of his master, to deliver the same to its customer, namely, the Complainant, in our opinion, the Dealer is liable for all acts of omission or commission by its employee, during the course of his employment. Once the vehicle was left in the custody of the dealer, who undertook to get it delivered to the place of the Complainant after the repairs, probably as a goodwill gesture, it would be liable for the loss or damage to the vehicle during carriage. We hold accordingly.

18.     In the final result, the Revision Petition filed by the Manufacturer (RP No. 1589/2013) is allowed and the impugned order, qua it, is set aside. The Revision Petition preferred by the Dealer (RP No. 2067/2013) is dismissed with costs, quantified at ₹20,000/-, in addition to the costs imposed by the Fora below. The direction to either replace the accidental vehicle with a new vehicle of the same model or to refund the cost price, viz. ₹7,88,413/- along with compensation of ₹50,000/- shall be complied with by the Dealer within four weeks from the receipt of a copy of this order, failing which the said amount shall carry interest @ 9% p.a. from the date of filing of the Complaint till realization. On compliance with the order,  the Complainant shall execute all the documents which may be required for re-sale/transfer of the vehicle, if not already sold in terms of the permission granted vide order dated 23.5.2014, in the records of the Motor Vehicle Registration Authority. It is also clarified that if the Complainant has received any amount of compensation in respect of the accident from the Insurance Company, the said information shall be furnished by her to the Dealer, who will be entitled to account for the same while remitting the afore-stated amounts to the Complainant, in the event of its exercising the alternative option of refunding the cost of the vehicle along with compensation of ₹50,000/-. If the amount deposited by the Manufacturer in the State Commission, has already been withdrawn by the Complainant, in terms of the order dated 23.05.2014 passed by this Commission, the short fall, if any, shall be made good by the Dealer, within four weeks of receipt of a copy of this order. It will be open to the Manufacturer to recover the amount, if deposited in the State Commission, in terms of the interim order dated 08.05.2013, from the dealer after due notice. 

19.     All the Revision Petitions stand disposed of in the above terms, leaving the parties to bear their own costs.