Delhi

North

RBT/CC/168/2024

GENNEXT LAB TECHNOLOGIES PVT LTD - Complainant(s)

Versus

VAV INSTRUMENTS - Opp.Party(s)

14 May 2024

ORDER

District Consumer Disputes Redressal Commission-I (North District)

[Govt. of NCT of Delhi]

Ground Floor, Court Annexe -2 Building, Tis Hazari Court Complex, Delhi- 110054

 

CONSUMER COMPLAINT NO.: RBT/CC/168/2024

[DCDRC-V Consumer Complaint No.: 638/2023]

In the matter of

M/s GenNEXT Lab Technologies Pvt. Ltd.

Through its authorized representative

Office No.-3, CSC-5, 1st Floor,

Gole Market, Sector-9, Rohini,

Delhi-110085                                                       …      Complainant

Versus

M/s VAV Instruments,

Through its Principal Officer,

Mr. Vijay Sharma (Director),

Office/Factory: Khan Compound,

Y-11, 12, Plehar, Vasai (East)

Palghar, Mumbai- 401208                                    …      Opposite Party

 

ORDER

14/05/2024

Present: None for Complainant.

(Divya Jyoti Jaipuriar)

1. Hon’ble Delhi State Commission vide its office order dated 05.02.2023 bearing No.F.1/SCDRC/Admn/Transfer/2024/133, while exercising powers under section 70 of the Consumer Protection Act, 2019, has transferred 150 consumer complaints from DCDRC-V (North West) to this Commission. In the said batch of the complaint, the above captioned complaint was also transferred to this Commission. Upon receipt the records from DCDRC-V (NW), this was observed that admission hearing was not concluded before the transferring Commission prior to transfer. Accordingly, on the first date of listing before this Commission on 25.04.2024, we listed this matter for admission hearing, when Ld. Advocate for the Complainant sought an adjournment. Thereafter, the matter was listed on 06.05.2024, when we heard the arguments of Shri Jagdish Singh, Ld. Advocate for the Complainant Company before reserving the orders on admissibility of this complaint.
2. The Complainant herein namely M/s GenNEXT Lab Technologies Pvt Ltd, is a private limited company having its office at Gole Market, Delhi. The said Complainant Company has purchased 16 numbers of “Laboratory Refrigerator Double Door Capacity 360 Litre: Model VSLR360” from one M/s VAV Instruments (OP herein). Although there is no specific pleading about usage of these refrigerators, the documents on record indicate that although these refrigerators were delivered in Delhi, these were installed different locations of the Complainant Company in the state of Uttarakhand.
3. During arguments, we posed the question to Shri Jagdish Singh, Ld. Advocate for the Complainant to explain as to how the Complainant Company is covered under the definition of “Consumer” as defined in section 2 (7) Consumer Protection Act, 2019and how the transaction in question is not commercial in nature. In reply, he stated that the Complainant is indeed a registered company, but in the entire pleading, it has not been pleaded that the said purchase was made for commercial purposes. However, he also stated that he it cannot be said that the purchases were made for personal use of the items by the directors of the company. He also argued that as the Complainant Company purchased the refrigerators from the OP herein and OP failed to provide after sales services to the Complainant Company, the Complainant Company becomes a Consumer within the meaning of the provisions of the Consumer Protection Act, 2019. It was also argued by the Ld. Advocates of the Complainant that the Complainant Company has not pleaded anywhere that the refrigerators were purchased for commercial purposes.
4. Before proceeding further, it is paramount to reproduce relevant provisions of the Consumer Protection Act, 2019. Section 2 (7) CPA, 2019, reads as under:

“2. Definitions.—In this Act, unless the context otherwise requires,—

1.  

(7) “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 service 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 service 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 service for any commercial purpose.

Explanation.—For the purposes of this clause,—

(a) the expression “commercial purpose” does not include use by a person of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment;

(b) the expressions “buys any goods” and “hires or avails any services” includes offline or online transactions through electronic means or by teleshopping or direct selling or multi-level marketing;

 

5. The said provision clearly excludes the transactions which are for “commercial purposes” from the ambit of application of the CPA, 2019.  Although in a recent judgment, Hon’ble Supreme in the matter of National Insurance Co. Ltd. v. Harsolia Motors [(2023) 8 SCC 362], while dealing with identical provision as in section 2 (1) (d) of the Consumer Protection Act, 1986 (now repealed), has held that even Commercial Enterprises can file a consumer complaint if the said commercial enterprise is able to establish that the purchase of goods and service by the said enterprise is not directly related to profit generating activity of the enterprise. In this context, Hon’ble Supreme Court in Harsolia Motors case (supra) has held as under:

“39. Applying the aforesaid test, two things are culled out: (i) whether the goods are purchased for resale or for commercial purpose; or (ii) whether the services are availed for any commercial purpose. The two-fold classification is commercial purpose and non-commercial purpose. If the goods are purchased for resale or for commercial purpose, then such consumer would be excluded from the coverage of the 1986 Act. For example, if a manufacturer who is producing product A, for such production he may be required to purchase articles which may be raw material, then purchase of such articles would be for commercial purpose. As against this, if the same manufacturer purchases a refrigerator, television or air-conditioner for his use at his residence or even for his office has no direct or indirect nexus to generate profits, it cannot be held to be for commercial purpose and for aforestated reason he is qualified to approach the Consumer Forum under the 1986 Act.”

6. While passing the above order in Harsolia Motors (supra) case, Hon’ble Supreme Court has relied on its earlier judgments in the matter of Lilavati Kirtilal Mehta Medical Trust v. Unique Shanti Developers [(2020) 10 SCC 274] and Shrikant G. Mantri vs. Punjab National Bank [(2022) 5 SCC 42]. In Lilavati Kirtilal Mehta Medical Trust (supra) judgment, Hon’ble Supreme Court has laid down broad principles to determine any activity as “Commercial Activity”. Hon’ble Supreme Court in Lilavati Hospital case (supra) has held as under:

“19. To summarise from the above discussion, though a strait jacket formula cannot be adopted in every case, the following broad principles can be culled out for determining whether an activity or transaction is ‘for a commercial purpose’:

19.1. The question of whether a transaction is for a commercial purpose would depend upon the facts and circumstances of each case. However, ordinarily, “commercial purpose” is understood to include manufacturing/industrial activity or business-to-business transactions between commercial entities.

19.2. The purchase of the good or service should have a close and direct nexus with a profit-generating activity.

19.3. The identity of the person making the purchase or the value of the transaction is not conclusive to the question of whether it is for a commercial purpose. It has to be seen whether the dominant intention or dominant purpose for the transaction was to facilitate some kind of profit generation for the purchaser and/or their beneficiary.

19.4. If it is found that the dominant purpose behind purchasing the good or service was for the personal use and consumption of the purchaser and/or their beneficiary, or is otherwise not linked to any commercial activity, the question of whether such a purchase was for the purpose of “generating livelihood by means of self-employment” need not be looked into.”

7. While applying the said principles, Hon’ble Supreme Court in the matter of Shrikant G. Mantri (supra) judgment has examined the overdraft facility being utilised by a stockbroker has held that relations between the appellant [Stockbroker] and the respondent [Bank] is purely “business to business” relationship. Hon’ble Supreme Court, therefore concluded that as such, the transactions would clearly come within the ambit of ‘commercial purpose’ and it cannot be said that the services were availed “exclusively for the purposes of earning his livelihood” “by means of self-employment”. If the interpretation as sought to be placed by the appellant is to be accepted, then the ‘business to business’ disputes would also have to be construed as consumer disputes, thereby defeating the very purpose of providing speedy and simple redressal to consumer disputes, Hon’ble Supreme Court opined.
8. Ld. Advocate for the Complainant has relied on the judgment of Hon’ble Supreme Court in the matter of Kozyflex Mattresses Pvt Ltd vs SBI General Insurance Company Ltd. [2024 INSC 234], to argue that Hon’ble Supreme Court has, while distinguishing the facts as in the matters of Harsolia Motors (supra) and Shrikant G Mantri (supra) has held that Companies can also raise the consumer dispute if the services as offered by the OP is not for commercial activities. We do not agree with the arguments of the Ld. Advocate for the Complainant. In Harsolia Motors (supra) and also in Shrikant G Mantri (supra) cases, Hon’ble Supreme Court was dealing with the issue that whether the respective services offered by the Insurance Company and the Bank, respectively to the respective Complainant Companies can be treated as “for commercial purposes”. In both these judgments, Hon’ble Supreme Court has laid down a test that if the goods purchased/ services availed by the Complainant Company have a direct nexus with its profit generation activities, the same cannot be brought under the ambit of the applicability of CPA, 1986 (Hon’ble Supreme Court was dealing with the complaints filed under erstwhile CPA, 1986). The same principle was also applied in Kozyflex Mattresses (supra) case, in which Hon’ble Supreme Court has held that purchase of insurance policy for ‘Standard Fire and Special Peril (Material Damage)’ cannot be treated as commercial nature of the service availed by the Complainant Company as the said policy was purchased for covering risk of these elements only and for nothing else.
9. All these three judgments of Hon’ble Supreme Court in Harsolia Motors (supra), Shrikant G Mantri (supra) and Kozyflex Mattresses (supra) underline the principle that unless there is any nexus of profit generation by the Complainant Company while purchasing goods/ availing services from Opposite Party, the transaction cannot be termed as “Commercial” in nature. In the case in hand, although the Complainant Company has not indicated the purpose of purchase of 16 number of “Laboratory Refrigerators”, purchase of such high number cannot be said to be for personal use by its Directors. On the other hand, as per the information available on the official website of the Complainant Company, the Complainant Company is stated to be a “one of the leading organisations in the country in the industry as a Complete Water, Analytical, Coal Instruments and complete Turnkey Solution Provider" and it has been serving the Educational Institutes, Municipal/ PHED's, Research Institutes, Government Sector Organisations, Industrial sector (Chemical, Power, Pharma, Food & Beverages, Fertilizer, Oil & Gas etc) with user friendly & automated products in the field of Instrumentation. Complainant Company also provides complete solution for water and waste water analysis in Laboratory, Field and Process. The purchase of the 16 units of Laboratory Refrigerators, therefore, has either been purchased for the use of the same in different factory locations of the Complainant Company or for the resale. Hence, in the case in hand, we are of the opinion that the relationship between the Complainant Company and the OP Company is purely “business to business”. The dominant purpose of procurement of Laboratory Refrigerators, which were delivered in Delhi but transported to different locations in Uttarakhand, can only be for commercial purpose. It also has close and direct nexus with the profit generating activity of the Complainant Company.
10. In view of the guiding judgments of Hon’ble Supreme Court, as quoted above in this order, such business to business transaction for profit generating activities of the Complainant Company, under no stretch of imagination can be brought under the purview of Consumer Protection Act, 2019.
11. In view of the above, we are of the opinion that the Complainant Company is not a consumer as defined under section 2 (7) of the CPA, 2019 and this Commission cannot entertain this complaint on merits. Hence, this complaint is liable to be dismissed on the sole ground that Complainant Company is not a consumer within the ambit of section 2 (7) of the CPA, 2019.
12. Accordingly, for the foregoing reasons, this complaint is dismissed. However, we grant liberty to the Complainant Company to approach the Forum/ Court of appropriate jurisdiction, if so advised for the relief so claimed in this complaint. We also clarify that while dismissing the complaint we have only examined one aspect that whether the Complainant Company is a consumer or not for application of the provisions of the CPA, 2019 and we have not examined the case on the facts, evidences and merits of the case. Therefore, we clarify that as we have not expressed any opinion on the merits of the case, if the Complainant approached any other Forum/ Court, the same shall decide the case on its own merit without being influenced by any of the observations made in this order.
13. Office is directed to supply the copy of this order to the parties as per rules. Thereafter, file be consigned to the record room.

 

 

 

___________________________

Divya Jyoti Jaipuriar, President

 

 

___________________________

Ashwani Kumar Mehta, Member

 

 

___________________________

Harpreet Kaur Charya, Member