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

                                  Consumer Complaint No.490 of 2015

                                 Date of institution:          30.09.2015

                                             Date of Decision:            29.01.2016

Sorabh Sharma son of Narinder Mohan Sharma, resident of House No.94, Phase-IV, Sector 59, Mohali, Punjab.

                                     ……..Complainant

                                        Versus

1.     Planet Fashion, Madura Fashion & Lifestyle, SCF 75, Phase 7, Mohali, Punjab 160055 through its Managing Director.

2.     Planet Fashion, Gayathri Tech Park, Plot No.183, EPIP, Near iGATE, KIAB Industrial Area Road 1B, Bangalore 560066 through its Managing Director.

                                                               ………. Opposite Parties

Complaint under Section 12 of the

Consumer Protection Act, 1986.

CORAM

Mrs. Madhu. P. Singh, President.

Shri Amrinder Singh Sidhu, Member

Mrs. R.K. Aulakh, Member.

Present:    Shri Rajat Nakra, counsel for the complainant.

Opposite Parties ex-parte.

(Mrs. Madhu P. Singh, President)

ORDER

                The complainant has filed the present complaint seeking following direction to the Opposite Parties (for short ‘the OPs’) to:

(a)    furnish any such notification or regulation issued by any concerned taxation authorities for the time being in force for charging extra VAT on MRP during discount period.  

(b)    to furnish their balance sheets and ledger accounts showing the total amount collected by charging extra VAT during sale period alongwith tax receipts or other proofs showing deposit of such amount with Income Tax authorities.

(c)     to refund the extra amount charged by the OPs.

(d)    to pay him Rs.30,000/- for harassment, mental agony and unfair trade practice.

(e)    to pay him Rs.15,000/- as litigation charges and other Misc. expenses.        

              The case of the complainant is that the OPs in order to  promote the sale of the products offered flat 50% discount on MRP on 14.08.2015. The complainant purchased T-shirt from the store/outlet of the OPs vide bill dated 14.08.2015 for Rs.689/-. The price of the t-shirt, before discount was Rs.1299/- inclusive of all taxes.  At the time of payment, the complainant objected to chaging of extra VAT @ 5.5% + 10% on the value of extra collected VAT by the OPs, as the cost of the T-shirt was inclusive of all taxes and VAT has already been added to the said cost and the complainant cannot be charged tax on tax. The complainant requested the officials of the OPs to re-check the said bill.
The complainant also requested the officials of the OPs to provide him the notification or any regulation issued by ay of the Taxation Authorities for the time being in force favouring such practice of charging extra VAT on discounted MRP. But the officials of the OPs suggested the complainant to approach the concerned authority himself. The officials told the complainant that if the amount is not paid then he would not be allowed to buy the T-shirt.  Under these circumstances the complainant paid this amount through VISA card. Thus, as per the complainant this act of the OPs is an act of unfair trade practice.  With these allegations, the complainant has filed the present complaint.

2.             Shri Amarjit Singh Longia, Advocate appeared for the OPs on 23.11.2015 and filed memo of appearance and the complaint was adjourned to 18.12.2015 for filing reply. However, thereafter none appeared for the both the OPs and thus, they were proceeded against exparte on 18.12.2015 and 22.12.2015.

3.             The complainant has tendered his affidavit Ex.CW-1/1 and copies of documents Ex.C-1 to C-2.

4.             We have heard learned counsel for the complainant and have also gone through the written arguments filed by him.

5.             The case of the complainant is that he was charged extra VAT to the tune of Rs.39/- for garment i.e. the t-shirt with the MRP of Rs.1299/- inclusive of all taxes after giving a flat discount of 50% i.e. Rs.649.50. As per the complainant, after discount the retail invoice dated 14.08.2015 Ex.C-1 for an amount of Rs.689/- has been issued by the OPs and further the OPs in the said invoice had charged extra VAT @ 5.5% plus 10% on the value of extra collected VAT. The levy of said VAT is resisted by the complainant but the officials of the OPs did not satisfy the complainant rather asked him not to buy the product if he is not willing to pay the extra VAT charged by them. The complainant, however, paid the amount under protest and made the payment through his visa card vide Ex.C-2. The harassment meted out to the complainant alongwith his family on account of illegal charging of VAT on the discounted price of the garment, as per complainant is an act of unfair trade practice.

6.             The core question which survives for determination in the present complaint is whether the MRP includes all taxes including VAT and whether after discount VAT can be charged or not.  After giving thoughtful consideration we are of the considered opinion that no one can charge more than MRP and MRP includes all taxes including VAT/other taxes. When MRP is including all taxes then VAT/other taxes cannot be charged separately meaning thereby that MRP includes VAT and after discount no VAT can be charged, so on discounted product also VAT cannot be charged if VAT is included in MRP.  Here we are fortified by the similar view taken by the Hon’ble State Consumer Disputes Redressal Commission, Bangalore in Appeal No.3723 of 2011 titled as The Branch Manager M/s. Shirt Palace Branch Black Bird Showroom Vs. Chandru H.C. decided on 16.01.2014. A similar question arose for determination before the Hon’ble State Consumer Disputes Redressal Commission, UT Chandigarh in First Appeal No.210 of 2015 decided on 01.09.2015 in case titled as Shoppers Stop and others Vs. Jashan Preet Singh Gill and others.

7.             In the instant complaint the MRP of the product in question was Rs.1299/- inclusive of all taxes and after 50% discount the price of the product was Rs.649.50 and the OPs have issued the invoice for Rs.689/- including VAT on the discounted price and the complainant has paid a sum of Rs.689/- through his debit card Ex.C-2. Therefore, it is ample clear that the OPs have charged Rs.39/- extra on account of VAT on the discounted price which they are not entitled to.

8.             In view of above discussion, the complaint is allowed with the following directions to the OPs to:

(a)    to refund to the complainant excess VAT charged i.e. Rs.39/- (Rs. Thirty nine only).

(b)    to pay to the complainant a lump sum compensation of Rs.10,000/- (Rs. Ten thousand only) on account of mental agony, harassment and costs of litigation.

                  Compliance of this order be made within a period of one month from the date of receipt of a certified copy of this order. Certified copies of the order be furnished to the parties forthwith free of cost and thereafter the file be consigned to the record room.

Pronounced.                           

January 29, 2016.     

                        (Mrs. Madhu P. Singh)

                                                                        President

                                                        (Amrinder Singh Sidhu)

Member

(Mrs. R.K. Aulakh)

Member