PER SHRI. S.B.DHUMAL - HON’BLE PRESIDENT :
1) In brief present dispute is as under –
That the Complainant is South Seas Distilleries & Breweries Pvt. Ltd. The Opposite Party Rejdeep Engineering Systems Pvt. Ltd. is a Company registered under Companies Act and dealing in business of manufacture and installation of Hammer Mills. It is the case of the Complainant that the Complainant was desirous of setting up Hammer Mills and therefore, by email dtd.12/02/07 the Complainant requested Opposite Party to submit its offer letter for the supply, installation and commissioning of Hammer Mill which would operate on 100 HP power and 75 HP. The Opposite Party submitted a techno commercial offer by a letter dtd.20/02/07. The total price quoted by Opposite Party for the mill an accessories was Rs.8,80,000/- and for remaining items Rs.1,80,000/-. The said offer letter contained a guarantee/warranty clause under which Opposite Party had given a guarantee against faulty design, defective material and/or bad workmanship. Guarantee was for period of 12 months from the date of supply.
2) Thereafter, Complainant placed an order for Hammer Mill capacity 6.5 M.T./per hour by letter ddtd.28/03/07 for a total price of Rs.10,01,250/- inclusive of taxes. The Complainant submitted the technical specifications, payment schedule, etc. As per purchase order erection of the Mill was to be carried out under the supervision of Opposite Party. Essence of order was the performance of the Hammer Mill i.e. it should give an output 6.5 M.T/per hour of grain containing moisture up to 10% and sieve size would be of 3 mm. It was agreed to release last installation of Rs.3,00,000/- only on successful commissioning and running of the mill for at least 15 days. The purchase order issued by the Complainant was accepted by the Opposite Party alongwith advance of Rs.2,00,000/-. Opposite Party caused delay in the manufacture of the said Hammer Mill. As per the purchase order Opposite Party had agreed to deliver the mill by the fourth week of May, 2007. The delay on the part of Opposite Party in stalling the Mill had caused mental harassment, agony and hardship to the Complainant. Drawing for the bill was received via a letter dtd.12/06/2007. The Complainant was not able to lay the foundation for the hammer mill as per drawing given by the Opposite Party therefore, Complainant requested Opposite Party to depute one Engineer. The Opposite Party deputed Mr. Prem on 26/07/07 to guide the Complainant in lying of foundation. The said engineer noticed that drawings sent by Opposite Party were not accurate. Installation of the Hammer Mill was urgency because Complainant could not start distillery without Hammer Mill. Substantial amount of correspondence took place between the parties.
3) It is alleged by the Complainant that Opposite Party supplied sub-standard material and caused inordinate delay in erecting Hammer Mills. When its trial was conducted, excessive vibrations felt on floor. Inspite of anti-vibration rubber pad, there was no improvement. Assurance was given buy the Opposite Party to solve the problem, but Opposite Party failed to solve various problems, including excessive vibrations. Inspite of repeated requests, no co-operation was given by the Opposite Party. Services rendered were defective. Due to sub-standard machinery and defective technique the Complainant could not start Hammer Mill. Lastly the Complainant was constrained to dismantle the Hammer Mill. Opposite Party was called back to take Hammer Mill and return. The amount but Opposite Party did not comply with the request of the Complainant. Legal notice dtd.31/01/08 was sent to the Opposite Party. Opposite Party in their reply dtd.14/03/08 made false and baseless allegations against the Complainant and did not comply with the notice. Therefore, the Complainant has filed this complaint.
4) Complainant has requested to direct Opposite Party to pay to the Complainant an amount of Rs.8,72,250/- for defective Hammer Mill and to take back the same from the Complainant. Complainant has claimed Rs.5 Lacks towards hardship, mental agony, harassment and damage suffered by the Complainant. The Complainant has also prayed for cost of this proceeding from the Opposite Party.
5) Initially the Complainant has filed this complaint before the Hon’ble State Commission, Mumbai. The Hon’ble President of State Commission, Mumbai by order dtd.11/12/08 directed to the Complainant to file complaint before the Consumer Forum. In the aforesaid order the Hon’ble Sate Commission has stated that “objection with record to commercial transaction is kept open.”
6) Alongwith complaint, the Complainant has filed list of documents at Exh. ‘A’ to ‘Y’.
7) Opposite Party had filed application dtd.09/03/09 and thereby raised objection contending that this Forum has no jurisdiction to entertain, try and decide this complaint as Opposite Party is carrying on its business at Pune. The goods were supplied from Pune which was received by the Complainant at Palghar, Dist.Thane. The installation of Hammer Mill was done at Palghar, Dist. Thane. It is further contended that Complainant is not a ‘Consumer’ within the meaning of Sec.2(1)(d) of the Consumer Protection Act. The Complainant has filed detail reply to the aforesaid application. This Forum by order dtd.21/08/09, have held that “part of the contract start at Mumbai. Hence we decide that this complaint can be entertained by this Forum.” The Opposite Party was directed to file its written statement. Opposite Party filed written statement and thereby resisted claim of the Complainant contending interalia that complaint is not maintainable in the present Forum and is liable to be dismissed. It is contended that as per provisions of Sec.11 of the Consumer Protection Act, 1986 this Forum has no jurisdiction to entertain, try and decide this complaint.
8) Opposite Party has raised contention that Complainant is not a Consumer within the meaning of Sec.2(1)(d) of the CPA. The Complainant had obtained Hammer Mill for commercial purpose and therefore, Complainant is not a Consumer and this complaint deserves to be dismissed in limine.
9) It is submitted by the Opposite Party that there is no deficiency on the part of Opposite Party. Opposite Party is Engineering Company, registered under Companies Act, 1956 and carrying on business of designing and manufacturing material Handling equipments. It is submitted that Hammer Mill is primarily used for crushing and grinding of the pure grains which are in turn used for commercial purpose of distillation and brewery. Opposite Party has admitted that by email dtd.12/02/07 Complainant placed an offer for supply, installation and commissioning of the Hammer Mill. In response to the said email Opposite Party submitted its offer for Mill capacity for 6.5 TPH quantity – 1 nos. and accessories. Opposite Party had provided the details of technical specifications for installation of the Mill. Total price quoted for supply, commissioning and supervision of the Hammer Mill was Rs.10,60,000/- and guarantee was given only against faulty design, defective material and bad workmanship. The Complainant agreed and accepted the said offer. It is grievance of Opposite Party that while during the course of installation of the Hammer Mill recommendations made by the Opposite Party were not followed by the Complainant which is resulted into the loss and the Opposite Party cannot be saddled with any liability for the negligence and default of the Complainant.
10) At the request of Complainant Opposite Party had deputed its engineer to the sight civil drawing for installation of Mill. Even though, civil work was not defined in the aforesaid work order. At the request of revised plan of drawing was prepared. There was no delay on the part of Opposite Party as alleged by the Complainant. It is contended that Opposite Party cannot be blamed improper erection of Hammer Mill. Time again Opposite Party depute Civil Engineers for installation of Hammer Mill. No arrangement was made by the Complainant for regular supply of electricity. After erection of Hammer Mill on 25/07/07 ‘No Load Trial was taken and performance of the mill was found satisfactory which was even acknowledged by the Complainant and it was recorded in the minutes of the meeting on 26/07/07.
11) According to the Opposite Party vibration found was due to the weak foundation and due to the soil quality below the foundation. Subsequently, the Complainant admitted that there is no vibration in the Mill structure. Anti-vibration Rubber pad was provided to the Complainant. Opposite Party has denied the allegations that the material supplied by the Opposite Party was sub-standard. It is alleged by the Opposite Party that raw material used by the Complainant was of impure quality and the Complainant ignored the suggestion made by the Opposite Party which resulted in overheating and choking of the Mill. Due to the negligence of the Complainant, the mill was not functioning properly and the Complainant is himself liable for the so called damage caused. The Opposite Party cannot be held liable for the claim preferred by the Complainant. The allegations made in the complaint are false and baseless and therefore, complaint deserves to be dismissed with cost.
12) Alongwith written statement Opposite Party has also filed number of documents. The Complainant has filed rejoinder and thereby denied allegations made in the written statement.
13) The Complainant as well as Opposite Party have filed their respective written arguments therefore, the complaint was closed for order –
14) Following points arises for our consideration and our findings thereon are as under -
Point No.1 : Whether the Complainant is a consumers as defined under Sec.2(1)(d) of the Consumer Protection Act. ?
Findings : No
Point No.2 : Whether the Complainant is entitled for compensation and other reliefs as claimed against Opposite Party ?
Findings : No
Reasons :-
Point No.1 :- In this case the Complainant South Seas Distilleries and Breweries Pvt. Ltd. on 28/03/07 had placed order for Hammer Mill, capacity 6.5 MT/per hour from Opposite Party. It is alleged by the Complainant that Opposite Party supplied sub-standard material. There was inordinate delay in building erection of the mill sub-standard and due to the defective technique the Complainant could not commence Hammer Mill and ultimately Hammer Mill was dismantled by the Complainant. The Complainant has alleged deficiency in service on the part of Opposite Party and claimed compensation form the Opposite Party.
Initially the Complainant on 23/10/08 had filed complaint before Hon’ble State Commission. The Hon’ble State Commission by order dtd.11/12/08 directed to return the complaint to the Complainant to file it before the Forum below. In the aforesaid order the Hon’ble State Commission has specifically observed “Objection with regard to commercial transaction is kept open.”
The Opposite Party had filed application and thereby raised preliminary objection defined that this Forum has no jurisdiction to entertain, try and decide this complaint as Opposite Party are residing at Pune, Hammer Mill was installed at Palghar and no cause of action took place within jurisdiction of this Forum. Said application was opposed by the Complainant and this Forum by order dtd.21/08/09 has held that this Forum has jurisdiction to entertain, try and decide this compliant. Opposite Party was directed to file written statement. In the aforesaid application, the Opposite Party has also raised contention that the Complainant is not a ‘Consumer’. However, this Forum by order dtd.21/08/09 has not given any finding on the point as to whether the Complainant is a Consumer.
In written statement the Opposite Party has denied that all the allegations made by the Complainant and he has raised contention that the Complainant is not a consumer as defined under Sec.2(1)(d) of the CPA therefore, according to the Opposite Party, present Complainant is not a consumer and deserves to be dismissed with cost under Sec.2(1)(d) of the CPA.
It appears from the evidence on record that Complainant is carrying on business of distilleries and breweries. The Complainant had placed order of installation of Hammer Mill with this Opposite Party. Hammer Mill is used for crushing and grinding of pure grains which are in turn used for various commercial purpose. In the instance case, Complainant was intending to use Hammer Mill for the purpose of distilleries and breweries. It is clear from the documentary of evidence on record that Complainant has placed order for installation of Hammer Mill and availed service for the Opposite Party for business purpose. The Hon’ble Supreme Court in the matter of Laxmi Engineering Works …. Appellant V/s. P.S.G. Industrial Institute …. Respondent reported in AIR S.C. 1995, 1428 have held that “the definition of the expression” “Consumer” in clause (d) of Sec.2 of the Consumer Protection Act, 1986 excludes from its purview” a person who obtains such goods for resale or for any commercial purpose.” In the aforesaid case it is held by the Appex Court, “the act provides for “business to consumer” disputes are not fall “business to business dispute” by the amending Act, 62 of 2002 provision of Sec.2(1)(d)(ii) are amended and thereby person who avails serviced for any commercial purpose is excluded from the definition of Consumer. At present definition of ‘Consumer’ given in Sec.2 (1)(d) is 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 obtains 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 and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person [but does not include a person who avails of such services for any commercial purpose].
[Explanation – For the purpose of this clause, “commercial purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment;]
Recently the Constitutional Bench of Hon’ble Supreme Court in the matter of Economic Transport Organization V/s. M/s.Charan Spinning Mills (P) Ltd. reported in 2010(2)(C.P.R.)181SC have clearly stated in paragraph no.25 of the judgement that –
“We may also notice that Sec.2(d) of the Act was amended by amendment Act, 62/2002 with effect from 15/03/03 by adding the words “but does not include a person who avails of such services for any commercial purpose” in the definition of Consumer. After the said amendment, if the services of the carrier had been availed for any commercial purpose, then the person availing the services will not be a “Consumers” and consequently, complaints will not be maintainable in such cases.”
Considering the facts stated in the complaint, it is clear that the Complainant purchase material of Hammer Mill and availed services of Opposite Party for installation of Hammer Mill for commercial purpose and therefore, Complainant is not a consumer as defined under Sec.2(1)(d) of the Consumer Protection Act and hence, we answer point no.1 in the negative.
Point No.2 :- As the Complainant is not ‘Consumer’ as defined under Sec.2(1)(d) of the Consumer Protection Act. Therefore, in view of the aforesaid observation of the Hon’ble Supreme Court, present complaint is not maintainable under Consumer Protection Act. Hence, Complainant is not entitled to claim any relief against Opposite Party from this Consumer Forum. Therefore, we answer point no.2 in the negative.
For the reasons discussed above, the complaint deserves to be dismissed hence, we pass following order -
O R D E R
i.Complaint No.04/2009 is hereby dismissed with no order as to cost.
ii.Certified copies of this order be furnished to the parties.
