DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, SAHIBZADA AJIT SINGH NAGAR (MOHALI)
Consumer Complaint No.221 of 2017
Date of institution: 20.03.2017 Date of decision : 16.02.2018
Bhupinder Singh Matharoo son of Resham Singh resident of Plot No.114, Industrial Area, Phase-1, Chandigarh 160002.
…….Complainant
Vs
Reebok, Adi Sports India Pvt. Ltd., GF 001, FF-40,41,42,43,44, Cosmo Plaza, NH-22, Mohali, Zirakpur through its Proprietor/Manager/Authorised Signatory.
……..Opposite Party No.1
Reebok India Company, 7th Floor, Unitech Commercial Tower-II, Sector 45, Block-B, Greenwood City, Gurgaon-122001 Haryana, through its Proprietor/Manager/Authorised Signatory.
……..Opposite Party No.2
Complaint under Section 12 of
the Consumer Protection Act.
Quorum: Shri G.K. Dhir, President,
Shri Amrinder Singh Sidhu, Member
Mrs. Natasha Chopra, Member.
Present: Shri Brijesh Khosla, counsel for complainant.
Shri Manoj Lakhotia, counsel for the OPs.
Order by :- Shri G.K. Dhir, President.
Order
Complainant, after seeing the displayed advertisement of sale of OP No.1 in February 2017, purchased one Boys Wor Knit Pant and one T-shirt, on the tags of which MRP of Rs.1,299/- and Rs.999/- were respectively mentioned. Discount of flat 50% on the price tags mentioning MRP (inclusive of all taxes) was offered. So discounted price of the purchased products was Rs.1,149/-. but OP No.1 charged VAT of Rs.69.51 N.P. @ 6.05% on this discounted price. Act of charging VAT on the discounted price alleged to be unfair trade practice as described in Section 2 (1) (r) of the Consumer Protection Act, 1986. OP No.2 is manufacturer/importer of brand Reebok, but OP No.1 is local dealer from whom complainant purchased the articles in question. Charging of VAT alleged to have caused harassment and pain to complainant and as such this complaint filed for seeking refund of excess charged amount of Rs.69.51 N.P. as VAT alongwith compensation for mental harassment and agony of Rs.50,000/-, but litigation expenses of Rs.15,000/-.
2. In almost identical reply filed by OPs it is pleaded inter alia as if jurisdiction of this Forum has been wrongly invoked because disputes arising out of the transaction are subject to jurisdiction of Gurgaon only; complainant alleged to be not a consumer within the meaning of Section 2 (1) (d) of the Act. Moreover, complaint alleged to be vague, misconceived and based on baseless assumptions. Issue of charging VAT on discounted price is already sub judice before Hon’ble Supreme Court of India in SLP No.8868 of 2017 titled as M/s. Aero Club (Woodland) Vs. Rakesh Sharma. SLP in that respect has been admitted by granting leave vide orders dated 31.03.2017 by Hon’ble Supreme Court of India. OP Company has acquired good market reputation for its range of products. Complainant has failed to disclose terms and conditions of invitation of discount offer. No unfair trade practice alleged to be adopted by OPs. Complainant after application of mind accepted terms and conditions of OPs, while paying due consideration amount without any protest. Complaint has been alleged to be filed by complainant as an afterthought for harassing OPs so as to get illegal gain. A reasonable person bound to understand or know the bargain price as discounted price alongwith VAT applicable thereon. In fact, like products are ordinarily sold at a discount in the market with VAT extra charged. Purchase of products in question by complainant not denied, but other contents of the complaint are denied.
In addition to above identical pleas, it is claimed through reply filed by OP No.2 that complainant has not purchased any goods from OP No.2 and nor hired any services for consideration and as such complainant is not consumer of OP No.2. It is also claimed that no cause of action has accrued to complainant against OP No.2, more so when OP No.2 itself not selling any products within the jurisdiction of this Forum. Products of OP No.2 are retailed through its franchise agents who sells the same through their stores. Moreover, it is claimed that complainant has suppressed material facts because he failed to disclose that invitation of offer of discount was subject to terms and conditions. No unfair trade practice adopted by OPs. Though separate replies are filed for each of the OP but same counsel is representing OPs.
3. Complainant to prove his case tendered in evidence his affidavit Ex.CW-1/1 alongwith documents Ex.C-1 to C-4 and thereafter closed evidence.
4. Counsel for the OPs tendered in evidence affidavit of Nadeem Akhtar, authorised signatory/representative of OPs Ex.OP-1/1 alongwith document Ex.OP-1 and Mark-A and thereafter closed evidence.
5. Written arguments submitted by complainant but not by OPs. Oral arguments heard and records gone through.
6. Contents of complaint as well as of affidavit and invoice Ex.C-1 establishes that one Boys Wor Knit Pant and one T-shirt were purchased by complainant after visiting OP No.1 at Zirakpur (District Mohali) on 22.02.2017 by paying price of Rs.1,149/- plus VAT amount of Rs.69.51 N.P. @ 6.05%. MRP of the purchased products mentioned as Rs.1,299/- and Rs.999/- (inclusive of all taxes) on the tags, copies of which are produced on record as Ex.C-3 and C-4. It is not disputed that discount of 50% was granted on the MRP and it is on the discounted price that VAT @ 6.05% = Rs.69.51 N.P. has been charged. That practice of charging VAT on the discounted price certainly is against the law laid down by Hon’ble National Consumer Disputes Redressal Commission, New Delhi in case titled as M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma bearing Revision Petition No.3477 of 2016 decided on 04.01.2017 as well as of case bearing First Appeal No.136 of 2017 titled as M/s Aero Club Vs. Ravinder Singh Dhanju decided on 23.05.2017 by Hon’ble State Consumer Disputes Redressal Commission, UT Chandigarh. Ratio of both these cases lays that when MRP is inclusive of all taxes, then VAT/other taxes cannot be charged separately, meaning thereby that on discounted price no VAT can be charged. In the case before us, VAT has been charged on the discounted price, which is not permissible as per law laid down in the above cases as well as in two cases cited in the written arguments submitted by complainant and as such certainly OP No.1, the seller, adopted unfair trade practice in doing so. As and when any unfair trade practice is adopted, then certainly action of the dealer/retailer causes mental tension and harassment to the consumer. So, complainant certainly is entitled to compensation for mental harassment and agony from OP No.1 alone because excess amount charged by OP No.1 and not by OP No.2. Refund of excess charged amount also should be done by OP No.1, who provided deficient services by charging VAT extra on the discounted price, despite the fact that such practice deprecated in the above cited cases.
7. Learned counsel for the OP vehemently contends that as order dated 04.01.2017 passed by the Hon’ble National Commission in case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) has been challenged before the Hon’ble Supreme Court and as the Hon’ble Supreme Court has admitted the Special Leave Petition, as disclosed by contents of Mark-A, and as such benefit from ratio of cases of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) and M/s Aero Club Vs. Ravinder Singh Dhanju (supra) referred above, cannot be got by the complainant. That submission of counsel for OP has no force because it is well settled that bare filing of Special Leave Petition or admission thereof, will not tantamount to staying of operation of orders of Hon’ble National Commission. The ratio of above quoted case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) of Hon’ble National Commission is binding on this Forum and as such the same has to be followed, in abeyance to the orders passed by any other District Forum or Hon’ble State Commission. Provisions of Order 41 Rule 5 of CPC also provide that mere filing of appeal does not amount to stay of operation of orders under challenge in appeal. Upon the same analogy, it has to be held that even if Special Leave Petition through Mark-A may have been admitted by Hon’ble Supreme Court, despite that inference of stay of operation of law laid down by Hon’ble National Commission in case of M/s Aero Club (Wood Land) through its Manager Vs. Rakesh Sharma (supra) cannot be drawn.
8. As a sequel of above discussion, the complaint is allowed with direction to OP No.1 to refund excess charged amount of Rs.69.51 N.P. with interest @ 6% per annum w.e.f. 22.02.2017 till payment. Compensation for mental agony and harassment of Rs.2,000/- and litigation expenses of Rs.2,000/- more allowed in favour of complainant and against OP No.1. Payment of amount of compensation and litigation expenses be made within 30 days from the date of receipt of certified copy of the order. Complaint against OP No.2 the manufacturer/ importer, however, dismissed. Certified copies of the order be supplied to the parties free of cost as ordered through zimni order as ordered through zimni order and thereafter the file be indexed and consigned to the record room.
Announced
February 16, 2018.
(G.K. Dhir)
President
(Amrinder Singh Sidhu) Member
(Mrs. Natasha Chopra)
Member
