DISTRICT CONSUMER DISPUTES REDRESSAL FORUM (CENTRAL)ISBT KASHMERE GATE DELHI

CC/45/2019

No. DF/ Central/

M/s K.C.C. Buildcon Pvt Ltd.

Having its office at 501, 5^th Floor,

Block c, Nirvana Courtyard Nirvana Country,

Sector 50, Gurgaon (Haryana)

Through its Authorized representative

Director Sh. Vijay Kundu S/o Sh. Zile Singh

…..COMPLAINANT    

VERSUS

M/s National Insurance Company Ltd.

General Claim Hub 2E/25,

3^rd Floor, Opposite Bank of India,

Jhandewalan Extension,

New Delhi-110055.

             …..OPPOSITE PARTY

Coram  : Ms. Rekha Rani, President

                 Mrs. Manju Bala Sharma, Member

                 Shri R.C. Meena, Member

ORDER

Rekha Rani, President

1. M/s. K.C.C. Buildcon Pvt. Ltd. (in short the complainant) filed the instant complaint under section 12 of the Consumer Protection Act, 1986 as amended up to date (in short the Act) pleading therein that Complainant is a private limited company registered under the Companies Act.  It was in need of a goods vehicle in connection with their business and thus purchased a goods carrier dumper vehicle which was insured with M/s National Insurance Company Ltd. (in short the OP) valid for the period from 26.06.2016 to 25.06.2017.
2. On 19.04.2017 at about 10.45 AM, the driver of the vehicle namely Pargat Singh had parked the dumper vehicle near Vidisha Road after which he had gone to have some food. In the meantime, strong winds started as a result thereof 11 K.V. electric wire which was broken fell on the vehicle causing sparking. The vehicle caught fire and was completely burnt. Pargat Singh lodged a report with police station Khamkheda, Karariya on 23.04.2017.  Complainant intimated the OP vide its letter dated 19.04.2017 for registration of the claim.

Vide letter dated 11.04.2018 complainant was asked to furnish some documents which complainant submitted to OP.

Thereafter, OP again vide its letter dated 10.10.2018 asked the complainant to deposit more documents which complainant submitted.

Then, complainant waited for payment of claimed amount but surprisingly OP vide its letter dated 26.12.2018 asked complainant to deposit copy of driving license of Lalit Kishore.

Complainant never engaged any person by the name of Lalit Kishore as driver. Infact Pargat Singh was driver of the vehicle at the time of incident. Name of Lalit Kumar was wrongly mentioned by the surveyor in his report dated 18.05.2017. OP is bound to treat Pargat Singh as driver of the vehicle in question.Even surveyor of the OP was of the opinion that claim of the complainant appeared to be genuine and complainant is accordingly entitled to the claimed amount. Complainant has demanded Rs.19,50,000/- with interest and compensation from the OP.

3. OP contested the claim vide its written statement mainly on the ground that complainant is not a Consumer under Section 2(i)(d) of the Act as the vehicle in question was purchased for the business of the complainant for commercial purposes and further on account of the fact that complainant failed to produce driving license of Lalit Kumar who was driver of the vehicle at the time of incident.
4. Both the parties filed their evidence by way of affidavits.  They have also filed written arguments.  We have heard Shri J.S. Dahiya Counsel for complainant and   Shri Arminder Kumar Counsel for OP.
5. Complainant in Para No. 1 of the complaint has pleaded that Complainant is a private limited company registered under the Companies Act and is carrying on its business under the name & style of M/s K.C.C. Buildcom Pvt. Ltd.  It is further pleaded that Complainant Company was a need of good vehicle in connection with their business and accordingly it purchased dumper vehicle to carry public goods as per the permits issued in this regards.
6. Learned counsel for the OP contended that complainant is a private limited company engaged in building business and the dumper vehicle which was insured by OP was used for augmenting its business activities.  It is submitted that since the vehicle was used for commercial purpose, complainant is not a Consumer under Section 2(1)(d) of the Act.
7.  The word 'consumer' has been defined under Section 2(1)(d) (i)  of the Act as under :

“(d) ‘consumer’ means any person who, -

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtain such goods for resale or for any commercial purpose; or

(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid or partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first-mentioned person.”

8. Clause (i) provides that one who buys any goods for consideration is a Consumer but a person who obtains such goods for resale or for any commercial purpose, is not a consumer. The intention of the Legislature behind said the definition of Consumer is that when the goods are exchanged between a buyer and the seller for commercial purpose or for resale, such commercial transactions are excluded from the purview of the Act.

The Supreme Court has discussed the term ‘consumer’ in the judgment reported in Laxmi Engineering Works v PSG Industrial Institute, II (1995) CPJ 1 (SC) = 1995 3 SCC 583, wherein it was held:

“The National Commission appears to have been taken a consistent view that where a person purchases goods 'with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit',   he will not be a ‘consumer’ within the meaning of Section 2(d)(i) of the Act. Broadly affirming the said view and more particularly, with a view to obviate any confusion - the expression ‘large scale’ is not a very precise expression - Parliament stepped in and added the explanation to Section 2(1)(d) by Ordinance / Amendment Act, 1993. The explanation excludes certain purposes from the purview of the expression ‘commercial purpose’ - a case of exception to an exception. Let us elaborate: a person who buys a typewriter or a car and uses them for his personal use is certainly a ‘consumer’ but a person who buys a typewriter or a car for typing others’ work, for consideration or for plying the car as a ‘taxi’, can be said to be using the typewriter/car for a commercial purpose. The explanation however clarifies that in certain situations, purchase of goods for 'commercial purpose' would not yet take the purchaser out of the definition of expression of expression ‘consumer’. If the commercial use is by the purchaser himself for the purpose of earning his livelihood by means of ‘self employment’, such purchaser of goods is yet a 'consumer'. In the illustration given above, if the purchaser himself works on typewriter or plies the car as a taxi himself, he does not cease to be a consumer. In other words, if the buyer of goods uses them himself, i.e. by self-employment, for earning his livelihood, it would not be treated as a 'commercial purpose' and he does not cease to be a consumer for the purposes of the Act. The explanation reduces the question, what is a 'commercial purpose', to a question of fact to be decided in the facts of each case. It is not the value of the goods that matters but the purpose to which the goods bought are put to. The several words employed in the explanation, viz., 'uses them by himself 'exclusively for the purpose of earning his livelihood ' and 'by means of self-employment' make the intention of Parliament abundantly clear, that the goods bought must be used by the buyer himself by employing himself for earning his livelihood. A few more illustrations would serve to emphasise what we say. A person who purchases an auto-rickshaw to ply it himself on hire for earning his livelihood would be a consumer.

Similarly, a purchaser of a truck who purchases it for plying it as a public carrier by himself would be a consumer. A person who purchases a lathe machine or other machine to operate it himself for earning his livelihood would be a consumer. (In the above illustrations, if such buyer takes the assistance of one or two persons to assist / help him in operating the vehicle or machinery, he does not cease to be consumer).   As against this, a person who purchases an auto-rickshaw, a car or a lathe machine or other machine to be plied or operated exclusively by another person, would not be a consumer.”

9. Biilagi Sugar Mill Ltd. v. Kessels Engineering Works (P) Ltd., II (2010) CPJ 242 (NC)., Hon'ble National Commission observed thus :-

“3. From the facts narrated in the complaint, it is clear that the Turbine (T.G. Set) in question had been purchased by the complainant for commercial purpose and, purchase for commercial purpose is excluded under Section 2(1)(d) (i) of the C.P. Act.”

10.       In Vandana Global Limited vs M/s Jaypee Engg. & Hydraulics Complaint Case No.13/06 before Chhattisgarh State Consumer Disputes Redressal Commission, Pandri, Raipur (C.G.)  complainant was a limited Company and dealt in the business of manufacturing Sponge Iron, Billets, Power, Ferro Alloys, Ferro Manganese, Metal Ferro Manganese, Silico Manganese, Metal Silico Manganese etc. State Commission vide its order dated 08.04.2013 observed that complainant purchased JP-Rok Machine for commercial purpose and thus complainant was not a Consumer and its request to direct OP to return the amount paid for defective product with interest and compensation was dismissed.
11.       In Raj Aggrawal vs G.M.V.E. complaint case No. 23/2009, complainant purchased 4 vehicles.  Claim was filed in respect of each vehicle which was still in warranty period and were not being repaired by the OP.  OP submitted that the vehicle in question was purchased for commercial purposes and plied by the complainant for transportation business for earning profits and therefore he did not come under the category of a consumer. Chhattisgarh State Commission vide its order dated 11/12/2009 observed that: 

“12. From the description of the complainant in the cause title of the complaint, it appears that the complainant is running the business in the name and style as Raj Aggrawal and Company.  The use of word “and company” shows that it was not only Mr. Raj Aggrawal, who is owner of the company, but along with him some other persons are also there and so it has become a company of more than one person that is why along with the name of Mr. Raj Aggrawal, “and Company” word has been used.  In the Certificate of Registration of the vehicle also, name of the registered owner has been shown as “Raj Aggarwal and Company”.  Thus, when the vehicle is property of a Limited Company, // 14 // having more than one person engaged in the affairs of the company, then it can never be said that any of the vehicle, was purchased by a person to earn his/her livelihood by self-employment.  When it is a question of Company, then profit earning motive, is self-apparent.’’   

12.      Learned Counsel for the complainant has submitted that a company can be a

Consumer and there is no bar that company cannot initiate proceedings under

section 12 of the Act.

13.      As per averments made in the complaint itself complainant needed goods       

          vehicle in connection with their business (para-2 of the compliant) and

          accordingly purchased vehicle in question. Nowhere in the complaint, it is

          indicated that the vehicle in question was purchased by the complainant for the

          purpose of earning livelihood by way of self employment.

14.      In Para-2 of the complaint it is clearly indicated that the vehicle in question was    

purchased by the complainant for augmenting its business income. Hence, in

view of the judgment discussed above it cannot be said that the vehicle was

purchased by the company to earn livelihood by way of self employment.The

vehicle in question is a commercial vehicle and is used for the purpose of making

          profits.  Complainant is not a consumer.  Therefore, the complaint is not

maintainable before this Forum.

15.      Copy of this order be sent to the parties as per rules. File be consigned to record room.

Announced this 29^th day of January 2020.