Punjab

Ludhiana

CC/17/742

Savinalini - Complainant(s)

Versus

Woodland Aro Club - Opp.Party(s)

11 Sep 2018

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, LUDHIANA.  

Consumer Complaint No. 742 of 11.10.2017

Date of Decision            :   11.09.2018

 

Savinalini w/o Janesh Mishra r/o #135, PUDA Colony, Green Avenue, Amritsar-143001.

….. Complainant

                                                         Versus

Woodland Aero Club Fountain Chowk, Shop No.107, F.F.Pavilion Mall, Old Session Court Road, Ludhiana, Punjab, through its Manager or authorized representative.

Opposite party

 

             (Complaint U/s 12 of the Consumer Protection Act, 1986) 

QUORUM:

SH.G.K.DHIR, PRESIDENT

SH. VINOD GULATI, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant            :         Sh.Manu Mittu, Advocate

For OP                           :         Mr.Honey Sood, Manager in OP in person

 

PER G.K.DHIR, PRESIDENT

 

1.              Complainant purchased one product having MRP of Rs.1695/- inclusive of all taxes from OP on 30.06.2017 by paying the price of Rs.1079/-(round of figure). Discount of 40% was given and the discounted price came to Rs.1017/-, but VAT of Rs.61.53P @6.05% charged. This act of charging VAT on the discounted price alleged to be an unfair trade practice and as such prayer made for directing OP to refund the excess charged amount of Rs.61.53P with interest @18% per annum. Compensation for mental harassment and agony of Rs.25,000/ and litigation expenses of Rs.15,000/- more claimed.

2.              In written reply submitted by OP, it is pleaded interalia as if complaint is not maintainable because the same has been filed just for harassing OP, so as to extract money from him; complainant has suppressed the material facts and complaint bad due to non-joinder of necessary party. It is claimed that OP has not charged any amount more than the one payable under the discount scheme and allegations to the contrary of charging VAT twice are without basis. As and when a purchaser avail discount scheme benefit, then he goes out of declaration of MRP, which serves on the basis of calculation of sale consideration. It is claimed that complainant failed to understand the concept of MRP because for clearance of stocks condition of charging extra VAT applies,as per which the customer required to pay the VAT. The sale consideration gets reduced by the amount of tax payable, whenever the sale is made on the MRP. Admittedly, the product in question sold at discount of 40%, which was offered only for allowing the reduction. Complainant was explained about the concept and he on being satisfied, purchased the product and now an afterthought story has been put forth regarding over charging. Scheme of offering discount is for clearance of old stock and there is no provision of prepaid taxes. MRP is only meant for placing restriction on the retailer qua charging amount in excess of one mentioned on the goods. There is complete disclosure and transparency in the advertisements displayed at the showroom and in leading newspaper. It is claimed that provision of Section 3 of Consumer Protection Act is not in derogation of any other law and as such, levy of VAT as per provisions of Punjab Act is quite proper. Only Commissioner appointed under the VAT Act has jurisdiction in Tax matters and as such by denying each and every other averment of complaint, prayer made for dismissal of complaint.

3.                Complainant in order to prove his case tendered in evidence his affidavit Ex.CA along with documents Ex. C1 and Ex.C2 and thereafter, counsel for complainant closed the evidence.

4.                On the other hand, Mr.Honey Sood, representative of OP tendered in evidence his affidavit Ex.RA and thereafter, closed the evidence.

5.                Written arguments not submitted, but oral arguments by counsel for complainant and by representative of OP alone addressed and those were heard. Records gone through carefully.

6.                Perusal of price tag Ex.C2 shows that the product in question purchased by the complainant was having MRP of Rs.1695/- inclusive of all taxes. After giving discount of 40%, price of product was Rs.1017/-, but VAT of amount of Rs.61.53P charged on the discounted price is a fact borne from invoice Ex.C1. So, it is obvious that OP charged VAT on the discounted price, which certainly is an unfair trade practice because act of charging VAT extra on the discounted price has been held to be an unfair trade practice by the 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 in 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 is fully applicable to the facts of the present case and as such, certainly OP adopted unfair trade practice in charging VAT extra on the discounted price, despite the fact that MRP was inclusive of all taxes. In view of this, certainly complainant is consumer of OP and this consumer complaint is maintainable. Argument to the contrary has no force.  

7.             Even if VAT to be charged from the buyer, despite that the terms of such practice can be changed by mutually arrived at contract through which the seller may undertake liability to pay VAT on the discounted price of a product having MRP inclusive of all taxes. It was OP itself who professed through Ex.C-2 that MRP will be inclusive of all taxes and as such on the discounted price, OP by such undertaking bound to pay VAT or other taxes. Complainant on representation of OP of discount offer on product having MRP inclusive of all taxes, purchased the product in question from OP and as such now OP estopped by its act and conduct from claiming that VAT to be charged extra on the discounted price, especially when law on the subject referred above is to the contrary.

8.             Provisions of Sales Tax Act or VAT Act 2005 stands on different footing than that of beneficial provisions of Consumer Protection Act. Assessment of turnover of a trader for purpose of sales tax to be done under taxation provisions for collecting revenue for the State, but under the garb thereof benefit of beneficial provisions of Consumer Protection Act cannot be denied to the consumers. So even if there may be responsibility of OP to collect VAT on the sold products, but despite that it is bound by its open offer of not charging VAT extra on the products having MRP inclusive of all taxes.     No other point argued.     

9.                Therefore, as a sequel to the above discussion, complaint allowed with direction to OP to refund the excess received amount of Rs.61.53 NP with interest @ 6% per annum w.e.f. 30.06.2017 till payment. Compensation for mental harassment of Rs.2,000/- (Rupees Two Thousand only) and litigation expenses of Rs.2,000/- (Rupees Two Thousand only)   more allowed in favour of complainant and against OP. Payment of amount of compensation and litigation expenses be made within 30 days from the date of receipt of copy of order. Copies of order be supplied to parties free of costs as per rules.

10.                        File be indexed and consigned to record room.

 

                     (Vinod Gulati)                               (G.K. Dhir)

              Member                                        President

Announced in Open Forum

Dated:11.09.2018

Gurpreet Sharma.