This complaint coming up before us for by The weDownload Manager">hearing on 25-05-12               in the presence of Sri N. Venkateswarlu, advocate for complainant and of Sri L. Ramesh Kumar, advocate for opposite parties 1 to 3, upon perusing the material on record and having stood over till this day for consideration this Forum made the following:-

O R D E R

Per Sri A. Hazarath Rao,  President:-

The complainant filed this complaint under section 12 of the Consumer Protection Act seeking Rs.2,50,000/- being the cost of the by The weDownload Manager">seeds; Rs.2,50,000/- as compensation towards mental agony and for costs.

2.    The averments of the complaint in brief are these:

The complainant on 05-10-10 purchased Bhendi by The weDownload Manager">foundation seed from the 1^st opposite party vide bill No.464 under buy back agreement.  As per that agreement/programme the complainant cultivated the seed under the guidance and supervision of the employees of the opposite parties.   The complainant on 03-01-11 supplied 2876 kgs of seed to the opposite parties.   On earlier occasions, the opposite parties paid cost of the seed to the complainant within forty five days after duly complying the lab by The weDownload Manager">testing formalities.   In the present case the opposite parties kept quite till 08-04-11 without giving any information to the complainant.   The complainant on 08-04-11 addressed a letter to the 1^st opposite party.   The 1^st opposite party through its letter dated 20-04-11 advised the complainant to take back the bhendi seeds alleging substandard.   The 1^st opposite party failed to send the seed for lab testing immediately within time observing the specific parameters.   The 1^st opposite party did not inform the complainant when it sent the seed supplied by the complainant for lab testing though required under RTI Act.    The 2^nd opposite party though an Appellate Authority also did not respond till today though appealed.   Sending the seed for lab testing at a belated stage was a negligent act of the opposite parties and it amounted to deficiency of service.  The complaint incurred loss of Rs.2,50,000/- cost of the seed.   The seed could not be of any use as the opposite parties advised the complainant to take back the seeds after three and half months.   The opposite parties though received notice from the complainant did not respond.   The complaint therefore be allowed.

3.    The contention of the opposite parties in brief is hereunder:

        The complainant is not a consumer and as such the Forum has no jurisdiction to entertain.     The complainant and opposite party entered into an agreement on 28-12-10 and that agreement was by The weDownload Manager">binding on both the parties.   The complainant instead of seeking a reference to an arbitrator approached this Forum.    The complainant on 03-01-11 supplied 19 bags weighing 765 kgs under one lot and another 52 bags weighing 2106 kgs of bhendi seeds.  At the time of receipt of seeds the opposite parties noticed high percentage of moisture and needed immediate drying.   The seeds supplied by the complainant were sent to by The weDownload Manager">quality control laboratory at Bhopal for testing and the analyst report dated 17-02-11 revealed that the seeds supplied in two lots were having germination capacity of 16% and 18% and such germination capacity was too low and was of substandard quality.    The said report was immediately communicated to the complainant.   On complainant’s  oral request the opposite parties sent those seeds again to the quality control laboratory at Secunderabad and analyst report dated 28-03-11 revealed that those two lots of seeds were having germination capacity of 25% and 12% only and was not fit for growing.   The opposite parties communicated the report of second analysis immediately and requested the complainant to take away the seeds.   But the complainant dodged the matter wantonly for litigation and got issued a notice on 20-04-11 with false allegations.   The opposite parties supplied entire information on 07-05-11 when sought under RTI Act.    The complaint did approach the Forum with a malafide intention suppressing true facts.   The complaint therefore be dismissed.

4.  Exs.A-1 to A-14 and Exs.B-1 to B-13 on behalf of complainant and opposite parties were marked respectively.

5.  Now the points that arose for consideration in this complaint are:

        1. Whether the complainant is a consumer under the provisions                         of Consumer Protection Act?

        2. Whether the complaint is maintainable without resorting to                  arbitration?

        3. Whether the opposite parties committed deficiency of service?

        4. Whether the complainant is entitled to compensation?

        5.  To what relief?

6.  Admitted facts in this complaint are these:

        1.  The complainant purchased bhendi foundation seeds from the              opposite parties on 05-07-10 (Ex.A-1).

          2. The complainant and opposite parties entered into an                          agreement (Ex.B-1).

3.  The complainant on 03-01-11 supplied 19 and 52 bags of                     bhendi seeds to the 1^st opposite party (Ex.B-3).

 4. The opposite parties advised the complainant to take back                  the seeds complaining substandard.

  5. The complainant sought information under RTI Act from the                        1^st opposite party (Ex.B-11).     

7.  POINT NO.1:-    The Supreme Court in M/s National Seeds Corporation Limited vs. Madhusudhan Reddy and another (Civil Appeal No.7543 of 2004 dated 31-01-12) following the judgment in Trans Mediterrranean Airways vs. Universal Exports held:

              “The aforementioned judgments present a clear answer to the appellant's challenge to the impugned orders on the ground that the growers had not availed the remedy of arbitration. An ancillary point which may not detain us for long but needs consideration is whether a grower is excluded from the definition of consumer' because the seeds produced by him are required to be supplied to the appellant. The argument of the learned counsel for the appellant is that the foundation seeds were supplied to the growers for commercial purpose and as such their cases would fall in the exclusion part of the definition of consumer'. In the first blush, this argument appears attractive but on a deeper examination, we do not find any merit in it. The expression “any commercial purpose” was considered in Laxmi Engineering Works v. P.S.G. Industrial Institute (1995) 3 SCC 583. The two-Judge Bench referred to the amended definition of consumer' contained in Section 2 (d) and observed:

“Now coming back to the definition of the expression consumer' in Section 2(d), a consumer means insofar as is relevant for the purpose of this appeal, (i) a person who buys any goods for consideration; it is immaterial whether the consideration is paid or promised, or partly paid and partly promised, or whether the payment of consideration is deferred; (ii) a person who uses such goods with the approval of the person who buys such goods for consideration; (iii) but does not include a person who buys such goods for resale or for any commercial purpose. The expression resale' is clear enough. Controversy has, however, arisen with respect to meaning of the expression “commercial purpose”.  It is also not defined in the Act. In the absence of a definition, we have to go by its ordinary meaning. Commercial' denotes “pertaining to commerce” (Chamber's Twentieth Century Dictionary); it means “connected with, or engaged in commerce; mercantile; having profit as the main aim” (Collins English Dictionary) whereas the word commerce' means “financial transactions especially buying and selling of merchandise, on a large scale” (Concise Oxford Dictionary). The National Commission appears to have been taking                   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(d)(i) by Ordinance/Amendment Act, 1993.”

           33. What needs to be emphasized is that the appellant had selected a set of farmers in the area for growing seeds on its behalf. After entering into agreements with the selected farmers, the appellant supplied foundation seeds to them for a price, with an assurance that within few months they will be able to earn profit.  The seeds sown under the supervision of the expert deputed by the appellant. The entire crop was to be purchased by the appellant. The agreements entered into between the appellant and the growers clearly postulated supply of the foundation seeds by the appellant with an assurance that the crop will be purchased by it. It is neither the pleaded case of the appellant nor any evidence was produced before any of the Consumer Forums that the growers had the freedom to sell the seeds in the open market or to any person other than the appellant. Therefore, it is not possible to take the view that the growers had purchased the seeds for resale or for any commercial purpose and they are excluded from the definition of the term consumer'. As a matter of fact, the evidence brought on record shows that the growers had agreed to produce seeds on behalf of the appellant for the purpose of earning their livelihood by using their skills and labour.

        Taking a clue from the above decision, we are of the considered opinion that the complainant is a consumer within the purview of Consumer Protection Act and hence answer this point in favour of the complainant.

8.  POINT No.2:-   In M/s National Seeds Corporation Limited vs. Madhusudhan Reddy and another (Civil Appeal No.7543 of 2004 dated 31-01-12) the Supreme Court held:

“The remedy of arbitration is not the only remedy available to a grower. Rather, it is an optional remedy. He can either seek reference to an arbitrator or file a complaint under the Consumer Act. If the grower opts for the remedy of arbitration, then it may be possible to say that he cannot, subsequently, file complaint under the Consumer Act. However, if he chooses to file a complaint in the first instance before the competent Consumer Forum, then he cannot be denied relief by invoking Section 8 of the Arbitration and Conciliation Act, 1996 Act. Moreover, the plain language of Section 3 of the Consumer Act makes it clear that the remedy available in that Act is in addition to and not in derogation of the provisions of any other law for the time being in force.  In Fair Air Engineers (P) Ltd. v. N.K. Modi (supra), the 2-Judge Bench interpreted that section and held as under:

                “the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that Section 3 envisages that the provisions of the Act are in addition to and are not in derogation of any other law in force. It is true, as rightly contended by Shri Suri, that the words “in derogation of the provisions of any other law for the time being in force” would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act.  Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well founded. Parliament is aware of the provisions of the Arbitration Act and the Contract Act, 1872 and the consequential remedy available under Section 9 of the Code of Civil Procedure, i.e., to avail of right of civil action in a competent court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.

It would, therefore, be clear that the legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the Code of Civil Procedure. Thereby, as seen, Section 34 of the Act does not confer an automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act.  It is a matter of discretion. Considered from this perspective, we hold that though the District Forum, State Commission and National Commission are judicial authorities, for the purpose of Section 34 of the Arbitration Act, in view of the object of the Act and by operation of Section 3 thereof, we are of the considered view that it would be appropriate that these forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that the Act intends to relieve the consumers of the cumbersome arbitration proceedings or civil action unless the forums on their own and on the peculiar facts and circumstances of a particular case, come to the conclusion that the appropriate forum for adjudication of the disputes would be otherwise those given in the Act.”

9.     It is not the case of the opposite parties that the complainant referred subject dispute to an arbitrator as per agreement.   Under those circumstances, this Forum has jurisdiction to entertain the complaint inspite of arbitration clause in Ex.B-1 agreement.                      We therefore answer this point in favour of the complainant.

10.  POINT No.3:-    The complainant purchased Bhendi seeds of            50 kgs from the 1^st opposite party for seed production under Ex.A-1 for Rs.7122/-.  The complainant delivered 765 kgs of Pedigreed Bhendi seeds in 19 bags, 2106 kgs of pedigreed Bhindi seeds in 52 bags to the 1^st opposite party on 03-01-11 as seen from Ex.B-3. 

11.   The contention of the opposite party is that they rejected the foundation seed supplied by the complainant under buy back policy for want of less germination capacity and they intimated the same to the complainant on 20-04-11 under registered post (Ex.B-10). 

12.   Sections 6 to 8 of the Seeds Act:

        “6. Power to specify minimum limits of germination and                             purity, etc:-  

                The Central Government may, after consultation with the                         Committee and by notification in the Official Gazette,                      specify,

        a) the minimum limits of germination and purity with respect to                        any seed of any notified kind or variety;

        b) the mark or label to indicate that such seed conforms to the                         minimum limits of germination ad purity specified under                   clause (a) and the particulars which such mark or label                         may contain.              

1. Regulation of sale of seeds of notified kinds or varieties:

        No person shall, himself or by any other person on his     behalf, carry on the business of selling, keeping for sale,      offering to sell, bartering or otherwise supplying any seed      of any notified kind or variety, unless,

1. such seed is identifiable as to its kind or variety;
2. such seed conforms to the minimum limits of germination and purity specified under clause (a) of section 6;
3. the container of such seed bears in the prescribed manner, the mark or label containing the correct particulars thereof, specified under clause (b) of section 6; and
4. he complies with such other requirements as may be prescribed.

8. Certification agency: The State Government or the     Central Government in consultation with the State       Government may, by for the State to carry out the    functions entrusted to the certification agency by or under       this Act.”

13.  Rules XXII and XXIII of General Seed Certification Standards are extracted below for better appreciation:

The general seed certification standard are applicable to all crops which are eligible for certification and with field and seed standards for the individual crops shall constitute the Minimum Seed Certification Standards.  The word ‘seed’ or ‘seeds’ as used in these standards shall include all propagating materials.   

XXII:  Seed Analysis Report:- The Seed Testing Laboratory shall analyse the seed samples in accordance with the prescribed procedure and deliver the Seed Analysis Report to the Certification Agency as soon as may be, but not later than 30 days from the date of receipt of the samples unless the seed is subjected to such tests which require more than 30 days for completion of the test.

XXIII. Seed Standards of Genetic Purity: a) All certified seed lots shall conform to the following Minimum Standards for genetic purity unless otherwise prescribed:

14.   The complainant in his complaint mentioned that earlier on three occasions the opposite parties paid amount within 45 days under buy back programme when he supplied seeds to the opposite party.   The complainant in para 3 of his complaint coined the deficiency of service as detailed infra:

        “But in this present case the opposite parties through its Guntur office received the stock of Bhendi seeds on 03-01-11 and kept quite without any intimation to the complainant till 08-04-11.   But the fallacy is when the complainant addressed a letter dated 08-04-11 to the 1^st opposite party, the 1^st opposite party through his letter dated 20-04-11 i.e., after lapse of 3^1/2 months sent a letter advising the complainant to take back the standard Bhendi seeds………………………………………………Therefore, it is evident from the above that the opposite parties have totally neglected the process and allowed the lapse of time bound programme of lab-testing of the seed and this resulted in becoming the seed sub-standard and informed the concocted reason to the complainant after a lapse of 3^1/2 months that too in response to the complainant’s letter.   It is due to this negligent act and deficiency of service on the part of the opposite parties, the complainant is put to a loss of Rs.2,50,000/- being the cost of seed and the worst situation is at this belated stage, the seed will not be of any use to the complainant”

15.   The National Seeds Corporation Limited processed the seeds supplied by the complainant in two lots on 21-01-11 within time as per rule XXII of General Seed Certification Standards and found them their germination capacity as 16% and 8% as seen from Ex.B-4 seed processing reports.  It is the contention of the opposite parties that it again sent the seed samples for another laboratory at Hyderabad on the request of the complainant and filed Ex.B-8 to substantiate it.   Again the sample was taken on 03-03-11 as seen from Ex.B-8.  The Quality Control Laboratory at Hyderabad conducted tests on 28-03-11 and found the percentage of germination in those two lots is at 25% and 12% as seen from Ex.B-9.   In the absence of any request from the complainant there was no need for the opposite parties to send them again for analysis as rightly contended by them.   It therefore presupposes that the complainant had knowledge of Ex.B-4 report.  The above circumstances falsified the contention of the complainant that the opposite parties sent samples for testing belatedly. 

16.   The complainant filed this case on 08-08-11 after receiving copy of Ex.B-10 report instead of resorting to section 11 of Seeds Act.   The opposite parties are justified in not taking the seed supplied by the complainant for want of poor germination percentage.   We therefore opine that the opposite parties did not commit any deficiency of service i.e., the delay in sending samples to analysis and thereby answer this point against the complainant.

17.  POINT No.4:-   In view of above findings, the complainant is not entitled to any compensation.   We therefore answer this point also against the complainant.

18. POINT No.5:-  In view of above findings, in the result the complaint is dismissed without costs.    

Typed to my dictation by Junior Steno, corrected by me and pronounced in the open Forum dated this the 31^st day of May, 2012.

MEMBER                                             MEMBER                                             PRESIDENT

APPENDIX OF EVIDENCE

DOCUMENTS MARKED

For Complainant:

For opposite parties :  

                                                                                           PRESIDENT