DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, ANANTAPUR.
PRESENT: - Sri C.Thyagaraja Naidu, B.Sc., B.L., President
Sri S.Niranjan Babu, B.A., B.L., Male Member
Tuesday, the 14th day of December, 2010
C.C.NO.117/2010
Between:
M/s Puttaiah Solvent Pvt. Ltd.,
By its Director, V.Vonnappa
S/o V.Puttaiah,
r/o Kalluru R.S.
Anantapur District. … Complainant.
Vs.
Veesons Energy Systems Pvt. Ltd.,
rep. by V.Ramakrishnan,
Managing Director, C-14/2
Industrial Estate, Thuvakudi
Tiruchurapalli,
Tamil Nadu State. … Opposite party.
This case coming on this day for final hearing before us in the presence of Sri N.R.K.Mohan & Sri T.Ramakrishna, advocates for the complainant and Sri I.Ravindranath, advocate for the opposite party and after perusing the material papers on record and after hearing the arguments of both sides, the Forum delivered the following:
O R D E R
Sri C.Thyagaraja Naidu, President: - This complaint has been filed by the complainant under section 12 of Consumer Protection Act, 1986 against the opposite party to direct him to pay a sum of Rs.4,41,252/- being the cost of boiler and other incidental charges incurred by the complainant, Rs.10,94,600/- being loss caused to the complainant due to non-functioning of the boiler, which comes to total Rs.14,95,852/- with interest @ 24% p.a. from the date of invoice i.e. 04-01-2008 till the date of payment, Rs.1,00,000/- towards mental agony and Rs.1,00,000/- towards costs of litigation.
2. The brief facts of the complaint are that: -The complainant is the Director of M/s Puttaiah Solvent Pvt. Ltd., located at Kalluru R.S., Anantapur and the opposite party is the manufacturer of Boilers. The complainant in order to reduce the cost of production decided to purchase a new boiler with a capacity of 500 Kgs/hour and placed purchase order for supply of boiler as per quotation/specification dt.11-10-2007 to the opposite party. The opposite party supplied the boiler and sent Proforma Invoice dt.05-12-2007 and later sent the boiler with original invoice No.500 dt.04-01-2008 and the same was installed in the factory of the complainant. After installing the boiler, the boiler was inspected by the Inspector of Boilers, Kurnool and certified installation. After installation of the boiler, the officials of the opposite party came for trial run/demonstration of the boiler and in the said trial run/demonstration it was found that the boiler produced steam pressure of 50 P.S.I.as against 150 P.S.I. The steam of pressure required to run the factory of the complainant is 150 P.S.I. and the complainant came to know that the boiler supplied by the opposite party is not to the requirement of the complainant against the purchase order dt.16-10-2007 quality and the same is not supplied as per the specifications made by the complainant in the purchase order. On that the complainant informed the same to the opposite party and the opposite party officials/people/engineers came to the plant of the complainant at Kallur R.S., on 06-04-2008 and inspected the same and found that the boiler is not delivering the required steam pressure as stipulated in the purchase order and noted the defects in the Field Survey Report prepared by them. The officials/people of the opposite party visited the plant of the complainant to rectify the defects in the boiler on 15-05-2008 and again on 16-07-2008 and 23-10-2008 but of no use they could not rectify the defect and the boiler did not produce 150 steam of pressure which is required to run the factory of the complainant. Finally the officials of the opposite party came on 23-10-2008 and inspected the boiler to rectify the defect and they could not rectify the same and they went away stating that they will inform the same to the opposite party and come soon, till now no action is taken by the opposite party to rectify the defect. The opposite party on 13-10-2009 wrote a letter to the complainant stating that they are sending one number feed water heater and I.D. Fan with motor as free to improve the efficiency of the boiler. Thus, the above said letter clearly discloses that the opposite party is very well aware of the fact that the boiler supplied by them to the complainant is not producing steam of required pressure under natural draught even by the date of above letter dt.13-10-2009. Thereafter, on number of occasions the complainant has informed and requested the opposite party to rectify the defect i.e. not giving sufficient steam of pressure by the boiler supplied by them but of no use. In spite of several and repeated requests the opposite party did not care to rectify the same and ultimately on 25-01-1999 the complainant got issued legal notice to the opposite party and the opposite party received the same and sent reply with false allegations. On account of defective boiler supplied by the opposite party, he suffered both mentally and financially, If the boiler is of correct one, which gives required steam of pressure to go on with the work and by doing that work the complainant will get income of Rs.1,728/- per day and the complainant could have saved production cost and on account of the said malfunctioning/defective boiler, the complainant not only forced to spend huge amount towards production cost and it caused lot of mental agony and tension to the complainant. The boiler received by the complainant about 672 days back i.e. as on 31-07-2010 and the same is kept idle in the plant of the complainant and for all these days the complainant making production with old boiler by spending huge amount towards fuel and power and the consumption of fuel is 115 Kgs.,/per hour and cost for one Kg. fuel is Rs.1.20 paise the same is calculated for 24 hours the cost of consumption of fuel will be at 3,312/- and the cost of power if calculated for 24 hours per day will be Rs.90/- and the same comes to a total sum of Rs.3,402/- only per one day and average 500 working days are taken for total period for claiming damages from the opposite party and accordingly with old boiler the total production cost which the complainant forced to spend Rs.3,402/- x 500 = 1701000 and if new boiler could have been properly worked the consumption is towards fuel is 61 Kg., x 24 x 500 days x 1.20 paise = 8,78,40/- and towards power a sum of Rs.1,22,000/- and towards man power Rs.1,50,000/- and the difference of cost of production the complainant sustained is Rs.10,94,600/-. The opposite party supplied malfunctioning/defective boiler to the complainant and even after supplying as they did not take proper steps to rectify the defects and to see that the boiler should give required steal of pressure to run the complainant’s factory and the opposite party is liable to pay the above difference of costs of production incurred by the complainant. Apart from the opposite party is also liable to return the cost of boiler of Rs.3,96,652/- and other incidental expenses which comes to a total sum of Rs.4,41,252/- that were incurred by the complainant for sending demand draft Rs.600/- Bank charges, postal and courier charges Rs.500/- and telephone charges Rs.2,000/- and unloading charges Rs.1,500/- and erection charges of Rs.40,000/- etc., total Rs.10,94,600/- + 4,41,252/- = Rs.14,95,852/- with interest at the rate of 24% p.a. from the date of invoice i.e. from 04-01-2008. Apart from that the opposite party is also liable to pay Rs.1,00,000/- towards mental agony and Rs.1,00,000/- towards the cost of litigation. Hence, prayed this Forum to direct the opposite party to pay the said amount as prayed for in the complaint.
3. The opposite party filed counter and contended that the complainant is not a consumer within the meaning of section 2(d) of Consumer Protection Act as the entire transaction between the complainant and the opposite party is commercial transaction since the boiler supplied by the opposite party to the complainant is utilized for business and commercial purpose of the complainant. The boiler was manufactured and supplied by the opposite party only as per contract entered into between the complainant and the opposite party. The boiler was only under the care and custody and responsibility of the complainant and he alone was using the same. Since it is the duty of the complainant to conform to the instructions given by the opposite party, which had failed to do, the complainant before unnecessarily blaming this opposite party ought to have followed all the instructions given by this opposite party and as mentioned in the Operation and Maintenance Manual. Since the complainant had taken delivery of the boiler in good condition as per the contract agreed between the complainant and the opposite party, after the boiler was run successfully and commissioned and since there is no defect much less manufacturing defect in the boiler manufactured by the opposite party, the complaint filed by the complainant is devoid of merits and has to be dismissed. The opposite party as a benevolent manufacturer though there is no manufacturing defect in the boiler, yet in order to satisfy the complainant, and in an attempt to sort out the problem that arose due to the complainant’s fault, has suggested an improvement by way of supplying an I.D. Fan and feed water heater and sent the same worth Rs.86,000/- to the complainant free of cost. But the complainant had not made use of the I.D. Fan and Feed Water heater by not installing the same in the boiler. On the other hand, unfortunately the complainant has chosen to turn around and accuse this opposite party on false and baseless allegations. The problems mentioned in the field service report is only due to the complainant’s own fault detailed above and this opposite party cannot be blamed on any account. This opposite party denied the other averments mentioned in the complaint and contended that the complaint filed by the complainant is liable to be dismissed with costs.
4. On considering the above pleadings, the points that arise for consideration are:
1. Whether the complainant is a consumer within the meaning of section 2(i) (d) (ii)
of Consumer Protection Act ?
2. Whether the complaint filed by the complainant is barred by limitation?
3. Whether the boiler supplied by the opposite party has manufacturing defects? If
so whether the complainant is entitled for refund of the cost of the boiler with loss incurred by him and damages and costs as claimed in the complaint from the opposite party?
4. To what relief?
5. To prove the case of the complainant, the evidence on affidavit of the complainant has been filed and marked Exs.A1 to A23 documents. On behalf of the opposite party, the evidence on affidavit of the opposite party has been filed and marked Exs.B1 and B2 documents.
6. Heard both sides.
7. POINT NO.1:- The counsel for the complainant contended that if there is manufacturing defect of the machinery during the period of warranty for which the manufacturer had undertaken to keep it in good working condition, even if sold for commercial purpose, the purchaser will certainly be a consumer under section 2(1)(d)(ii) of Consumer Protection Act and in support of his contention he placed reliance in the reported decision 2006 CTJ 996 (CP) (NCDRC) between East India Construction Co. Vs. Modern Consultancy Services and others, wherein it was held that:
“This Commission in a catena of judgments wherein it has held that even though the machine/equipment is used for commercial/industrial purpose if any manufacturing defect occurs during the warranty period then the issue is covered under the Act and for that purpose purchaser of the equipment is entitled to file a complaint under the Act. This point has been elaborated in the following judgments some of which are quoted below:
(a) In Meera & Co. Ltd., Vs. Chinar Syntex Ltd., (2004 CTJ 1086 (CP), this Commission has held that even if the generating set purchased by the complainant for a commercial purpose, it suffered the alleged defects during its warranty period of one year and, therefore, the complainant was well within its right to move the Consumer Forums under the Act, it being a consumer of the opposite party’s service. This Commission also mentioned that if any authority is needed on that settled position in law, reference may be made to the decision in Amtrex Ambience Ltd., Vs. Ms.Alpha Radios and another 1996 CTJ 906 (CP) = 1(1996) CPJ 324 (NC).
(b) In Amtrex Ambience Ltd’s case this Commission has held that where the allegations of the complainant was that there was malfunctioning of the machinery/equipment during the period of warranty when the manufacturer had undertaken to keep the machinery in good working condition, even if sold for commercial purpose, the purchaser will certainly be a consumer under section 2(1)(d) (ii) in respect of services rendered or to be rendered by the seller for the proper functioning of the machinery/equipment, system during the period of warranty.
(c) Similar was the finding of the National Commission in OP/290/1997 – Jindal Drilling & Ind. Ltd., Indocon Engineers Pvt. Ltd., and another. “
8. The counsel for the opposite party contended that the opposite party has delivered the boiler and installed the same and the complainant did not properly use the boiler as per the manual supplied to him. Hence, the boiler is not giving the required 150 PSI. He further contended that the complainant has purchased the boiler for commercial purpose and warranty period given to the complainant was already expired. Therefore, this Forum has no jurisdiction to entertain the complaint and in support of his contention he placed reliance in the reported decisions:
(1) 2009(4) CPR 210 Kerala State Consumer Disputes Redressal Commission between Customer Line Pvt. Ltd., and others Vs. Tata Communications Ltd., and another, wherein it was held that:
“ opposite parties objected to the maintainability of complaint – order – opposite parties’ services were availed of ‘for commercial purpose’ – complainant is not a consumer – complaint is dismissed as not maintainable. “
(2) II (2008) CPJ 2010 (NC) between Wimco Limited Vs. Ashok Sekhon & others wherein it was held that:
“Commercial purpose involved – complainant not consumer – order allowing complaint set-aside – complainant at liberty to file suit for relief claimed.”
9. In view of the principles laid down in the decision cited by the counsel for the complainant, which is referred above, it clearly goes to prove the fact that during the warranty period even though the goods have been purchased by the complainant for commercial purpose, the duty is cast upon the seller to effect the repairs or to replace the same if there is any manufacturing defect.
10. The opposite party has not filed any documentary proof to show that they have obtained receipt from the complainant that the boiler supplied and erected by them has been working properly as per requirements of the order placed by the complainant.
11. On the other hand, the evidence on affidavit of PW1, the complainant, PW2, expert and Exs.A9 to A12 documents marked on behalf of the complainant clearly goes to prove the fact that the boiler supplied by the opposite party is not giving required steam pressure of 150 PSI and the opposite party Field Surveyor has mentioned in Exs.A9 to A12 documents that they will sort out the problems of boiler performance and it requires immediate action.
12. Therefore, on considering the said facts and circumstances, it clearly establishes the fact that the boiler supplied by the opposite party to the complainant is not as per proforma invoice Ex.A5 requirements. Therefore, the expiry of the warranty period does not arise. Therefore, the complaint filed by the complainant is maintainable and the decisions cited by the counsel for the opposite party referred above do not apply to the facts of this case. Accordingly, this point is answered.
13. POINT NO.2:- The counsel for the complainant contended that when the opposite party, who supplied the boiler, is defective one and when the opposite party has not rectified the defects in the boiler supplied by the opposite party then the question of limitation does not arise and the limitation period commences only from the date of installation of the boiler as per the specifications ordered by the complainant. He contended that the Field Surveyor of the opposite party in Ex.A12 has clearly mentioned that they will sort out the problem of the boiler performance and it requires immediate action. Subsequently the opposite party did not rectify the defects. Therefore, the complaint filed by the complainant is maintainable.
14. The counsel for the opposite party contended that the opposite party has supplied the boiler and installed the same and the complainant has acknowledged the receipt of the boiler and the complainant has admitted that the opposite party sent the boiler with original Invoice No.500 dt.04-01-2008. Therefore, the complainant ought to have filed this complaint within 2 years from 04-01-2008 or 06-04-2008 but the complaint has been filed on 13-08-2010, which is beyond 2 years from the date of 04-01-2008 or 06-04-2008. Therefore, the complaint filed by the complainant is not maintainable. In support of his contention, he placed reliance in the reported decisions:
(1) 2005-4 Law Weekly page 741 between Haryana Urban Development Authority Vs. B.K.Sood wherein it was held that:
“Section 24-A debars any Fora set up under Act, admitting a complaint unless the complaint is filed within two years from the date on which the cause of action has arisen- claim of the respondent on the basis of the allegations contained in the complaint, was clearly barred by limitation as the two year period prescribed by section 24-A of the Act had expired much before the complaint was admitted by the State Commission. “
(2) (2009) 6 MLJ 581 (SC) between Kandimalla Raghavaiah & Co. Vs. National Insurance Co. and another wherein it was held that:
“It is clear from the correspondence between the appellant and the Insurance Company that cause of action in respect of the special insurance policy arose on 22/23-03-1988 when fire in the godown took place damaging the tobacco stocks hypothecated with the Bank in whose account the policy had been taken by the appellant. Thus, the limitation for the purpose of section 24-A of the Act began to run from 23-03-1988 and therefore the complaint before the Commission against the Insurance Company for deficiency in service, whether for non-issue of claim forms or for not processing the claim under the policy, ought to have been filed within two years thereof. As noticed above, the complaint was in fact filed on or after 24-10-1997, which was clearly barred by time. “
15. On point No.1 it is clearly held above that the boiler supplied and installed by the opposite party was not giving the required steam pressure of 150 PSI as ordered by the complainant and as per proforma invoice Ex.A5 supplied by the opposite party. Further as per Ex.A12 it clearly goes to prove the fact that the field surveyor has mentioned that we will sort out the problem of the boiler performance and mentioned that it requires immediate action. Thus it clearly goes to prove the fact that the opposite party has not installed the boiler as per specifications mentioned in proforma invoice Ex.A5. Therefore, the question of limitation began to run from 04-01-2008 or 06-04-2008 does not arise. Therefore, the complaint filed by the complainant is not barred by limitation. Accordingly, this point is answered.
16. POINT NO.3:- The evidence on affidavit of the complainant as PW1, the complainant and PW2 Khaleel, the expert who inspected and tested the boiler supplied and installed by the opposite party coupled with Exs.A9 to A12, it clearly goes to prove the fact that the boiler supplied by the opposite party is defective one. Further the opposite party has admitted in his counter as well as in his evidence on affidavit that he has supplied I.D. Fan and Feed Water Heater worth of Rs.86,000/- to the complainant free of cost to install the same to the boiler supplied by him but the complainant has not chosen to install the same. When the boiler supplied by the opposite party is not defective one, then there is no need for the opposite party to supply the above said materials to install the same to the boiler supplied by him. Further, it is the duty of the opposite party to fix the said material to the boiler supplied by him and to see that it produces the required steam pressure of 150 PSI as ordered by the complainant and as per proforma invoice Ex.A5. But the opposite party has not effected repairs to the boiler supplied by him to the complainant so as to produce the required steam pressure of 150 PSI as per proforma invoice Ex.A5. Therefore, the said contention of the counsel for the opposite party cannot be accepted.
17. Therefore, on considering the said facts and circumstances of the case, we have no hesitation to come to conclusion that the opposite party has supplied the defective boiler and not as per the requirement of the complainant as per proforma invoice Ex.A5. Thus there is deficiency of service on the part of the opposite party. Hence, the opposite party shall rectify the defects in the boiler supplied by him to the complainant within one month from the date of this order and the boiler shall produce steam pressure of 150 PSI as required by the complainant and as per proforma invoice Ex.A5 and after effecting repairs as mentioned above the opposite party has to take letter from the complainant to that effect failing which the opposite party shall repay the cost of the boiler of Rs.3,96,550/- with interest @ 12% p.a. from the date of supply of boiler i.e. 04-01-2008 till the date of payment. Since the opposite party has not supplied and installed the boiler as per requirement of the complainant and as per proforma invoice Ex.A5. Hence, the opposite party is liable to pay to the complainant Rs.10,000/- towards mental agony. Accordingly, this point is answered.
18. POINT NO.4:- In the result, the complaint is allowed and the opposite party is directed to rectify the defects in the boiler supplied by him to the complainant within one month from the date of this order and the boiler shall produce steam pressure of 150 PSI as required by the complainant and as per proforma invoice Ex.A5 and after effecting repairs as mentioned above the opposite party has to take letter from the complainant to that effect failing which the opposite party shall repay the cost of the boiler of Rs.3,96,550/- with interest @ 12% p.a. from the date of supply of boiler i.e. 04-01-2008 till the date of payment. The opposite party is liable to pay to the complainant Rs.10,000/- towards mental agony with costs of Rs.5,000/-. The said amount shall be payable by the opposite party to the complainant within one month from the date of this order.
Dictated to the Steno, transcribed by him, corrected and pronounced by us in open Forum this the 14th day of December, 2010.
MALE MEMBER PRESIDENT
DISTRICT CONSUMER FORUM DISTRICT CONSUMER FORUM
ANANTAPUR ANANTAPUR.
APPENDIX OF EVIDENCE
WITNESSES EXAMINED
ON BEHALF OF THE COMPLAINANT: ON BEHALF OF THE OPPOISITE PARTY:
-NIL- - NIL-
EXHIBITS MARKED ON BEHALF OF THE COMPLAINANT
Ex.A1 – Memorandum and Articles of Association of the complainant-firm
Ex.A2 - Photo copy of Detailed Energy Audit Study of Boiler of the complainant-firm.
Ex.A3 – Letter dt.11-10-2007 issued by Veesons Energy Systems Pvt. Ltd., Hyderabad.
to the complainant.
Ex.A4 - Letter dt.16-10-2007 addressed by the complainant-firm to Veesons Energy Systems
Pvt. Ltd.,Trichy.
Ex.A5 – Photo copy of Proforma Invoice dt.05-12-2007 issued by Veesons Energy
Systems Pvt. Ltd., Hyderabad in favour of the complainant-firm.
Ex.A6 - Photo copy of Invoice No.500 dt.04-01-2008 issued by Veesons Energy
Systems Pvt. Ltd., Hyderabad in favour of the complainant-firm.
Ex.A7 - Receipt No.10050 dt.19-102007 issued by issued by Veesons Energy
Systems Pvt. Ltd., Hyderabad to the complainant-firm.
Ex.A8 - Letter dt.29-12-2007 addressed by the complainant to M/s Veesons Energy
Systems Pvt. Ltd., Trichy.
Ex.A9 - Field Service Report dt.06-04-2008 issued by Veesons Energy Systems Pvt.
Ltd., Hyderabad to the complainant-firm.
Ex.A10 - Field Service Report dt.12-05-2008 issued by Veesons Energy Systems Pvt.
Ltd., Hyderabad to the complainant-firm.
Ex.A11 - Field Service Report dt.16-07-2008 issued by Veesons Energy Systems Pvt.
Ltd., Hyderabad to the complainant.
Ex.A12- Field Service Report dt.23-10-2008 issued by Veesons Energy Systems Pvt.
Ltd., Hyderabad to the complainant.
Ex.A13- Letter dt.27-07-2009 addressed by the complainant to M/s Veesons Energy
Systems Pvt. Ltd., Tiruchirapalli..
Ex.A14 - Letter dt.06-10-2009 addressed by M/s Veesons Energy Systems Pvt. Ltd.,
Tiruchirapalli to the complainant.
Ex.A15 - Certificate dt.13-10-2009 issued by M/s Veesons Energy Systems Pvt. Ltd.,
Tiruchirapalli to the complainant.
Ex.A16 - Office copy of legal notice dt.25-01-2009 got issued by the complainant to the
opposite party.
Ex.A17 - Reply notice dt.05-02-2009 got issued by the opposite party to the counsel for the
Complainant.
Ex.A18 - Office copy of legal notice dt.22-04-2009 got issued by the complainant to the
opposite party.
Ex.A19 - Returned Postal cover addressed to the opposite party.
Ex.A20 - Letter dt.08-12-2010 addressed by the complainant to the Indian Boiler
Manufacturer’s Association,Ahmedabad.
Ex.A21 - Letter dt.10-12-2009 addressed by the complainant to the Director General,
Confederation of Indian Industry, New Delhi.
Ex.A22 - Photo copy of Form-V issued by Inspector of Boiler,Kurnool to the complainant.
Ex.A23 - Certificate issued by Khaleel, Afzal & Son Industries, Hyderabad.
EXHIBITS MARKED ON BEHALF OF THE OPPOSITE PARTY
Ex.B1 – Handing Over Report issued by the opposite party dt.06-04-2008.
Ex.B2 – Commissioning Report –Safety Valve dt.06-04-2009 issued by the opposite party.
MALE MEMBER PRESIDENT
DISTRICT CONSUMER FORUM DISTRICT CONSUMER FORUM
ANANTAPUR ANANTAPUR.
Typed by JPNN
