TMI Blog1999 (12) TMI 770X X X X Extracts X X X X X X X X Extracts X X X X ..... nsumer’ under section 2(1)(d) and the scheme was a ‘service’ under section 2(1)(o). - CIVIL APPEAL NO. 411 OF 1997 - - - Dated:- 14-12-1999 - S. SAGHIR AHMAD AND R.P. SETHI, JJ. JUDGMENT Sethi, J. - The short but an important question of law to be decided in this appeal is as to whether the provisions of Consumer Protection Act, 1986 ( the Act ) can be invoked against the Provident Fund Commissioner by a member of the Employees Provident Fund Scheme? It has to be ascer-tained as to whether any such member is a consumer and the duties performed by the Provident Fund Commissioner under the relevant scheme is a service within the meaning of the Act. If it is held that such member is the consumer and the facilities provided are services , it has to be further considered as to whether the delayed payment of the provident fund to a member-employee amounts to deficiency of service under the Act. 2. The facts leading to the filing of the present appeal are that the respondent, who was a member of the Provident Fund Scheme, applied to the Regional Provident Fund Commissioner for the payment of his provident fund on 15-7-1992. It was found that the application file ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... een paid or promised or partly paid and partly promised, or under any system of the 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 services 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 services 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. ****** ( o ) service means service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both, entertain ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... laborate deficiency by clause ( r ) and even to define defect and deficiency by clauses ( f ) and ( g ) for which a consumer can approach the Commission. The Act thus aims to protect the economic interest of a consumer as understood in commercial sense as a purchaser of goods and in the larger sense of user of services. The common characteristics of goods and service are that they are supplied at a price to cover the costs and general profit or income for the seller of goods or provider of service. But the defect in one and the deficiency in other may have to be removed and compensated differently. The former is, normally, capable of being replaced and repaired whereas the other may be required to be be compensated by award of the just equivalent of the value or damages for loss. Goods have been defined by clause ( i ) and have been assigned the same meaning as in the Sale of Goods Act, 1930 which reads as under : "goods" means every kind of movable property other than actionable claims and money; and includes stocks and shares, growing crops, grass and things attached to or forming part of the land which are agreed to be severed before sale or under the contract of sale ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... goods for private use or consumption. The meaning of the word consumer is broadly stated in the above definition so as to include anyone who consumes goods or services at the end of the chain of production. The comprehensive definition aims at covering every man who pays money as the price or cost of goods and services. The consumer deserves to get what he pays for in real quantity and true quality. In every society, consumer remains the centre of gravity of all business and industrial activity. He needs protection from the manufacturer, producer, supplier, wholesaler and retailer." (p. 32) This Court again is S.P. Goel v. Collector of Stamps JT 1995 (9) SC 545 considered, with approval, the meaning and scope of the words consumer , service and deficiency in service . 6. In State of Orissa v. Divisional Manager, LIC JT 1996 (4) SC 584 the Court held : "The only question is : Whether the appellant is liable to pay compensation to Haribandhu Setha under the Act and whether the claim is maintainable. Section 2(1)( o ) of the Act defines services as under : "services" means service of any description which is made available to potential users and includes th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... itution of provident fund, pension and deposit linked insurance funds for employees working in factories and other establishments. Section 2( h ) defines fund to mean the provident fund established under the Scheme. Scheme means the Employees Provident Fund Scheme framed under section 5 thereof which provides : " Employees Provident Fund Scheme. (1) The Central Government may, by notification in the Official Gazette, frame a scheme to be called the Employees Provident Fund Scheme for the establishment of provident funds under this Act for employees or for any class of employees and specify the establishments or class of establishments to which the said Scheme shall apply and there shall be established, as soon as may be after the framing of the scheme, a Fund in accordance with the provisions of this Act and the Scheme. (IA) The Fund shall vest in, and be administered by, the Central Board constituted under section 5A. (IB) Subject to the provision of this Act, a scheme framed under sub-section (1) may provide for all or any of the matters specified in Schedule II. (2) A scheme framed under sub-section (1) may provide that any of its provisions shall take effect eith ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... senior advocate, who later appeared for the appellant submitted that as no part of the administrative charges is payable by the employee, he (employee) cannot be held to be a consumer within the meaning of section 2(1)( d ) in support of such a submission an affidavit of Shri D.P. Sethi, Assistant Provident Fund Commissioner has been filed wherein after reproduction of para 38 of the scheme it is submitted : "That under para 30 of Employees Provident Fund Scheme, 1952, employer is liable to pay both the contributions as well as administrative charges but under para 38 the employer is authorised to deduct the employee s share of contribution from his wages, consequently, leaving employer s shares as well as administrative charges payable by employer himself. That according to above scheme provisions it is the employer who is responsible to pay administrative charges and not the member. Following the above provisions of law the Central Board of Trustees is recovering administrative charges only from employer and not from members." 9. Such a submission which apparently appears to be attractive, when analysed in depth, is without substance and, if accepted, is likely to defe ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e promisor to the promisee or by the transferor or to the transferee." A perusal of the scheme unambiguously shows that it is for consideration which is applicable to all those factories and establishment covered under the Act and the scheme who are required to become a member of the fund under the scheme. Para 26 provides that every employee employed in connection with any work of the factory or other establishment to which the scheme applies other than an excluded employee, shall be entitled and required to become a member of the fund from the date the said para comes into force in such factory or the establishment. The scheme provides for the Board of Trustees, the appointment, power of Commissioner and other staff of Board of Trustees membership of the Fund, contribution, etc. Chapter V deals with contribution. The employer who is otherwise not a member of the scheme is obliged to contribute under the scheme at the rates specified therein of the basic wages, dearness allowance including cash value of any food concession and repairing allowances, if any, payable to each employee to whom the scheme applies. The contribution of the employee has to be equal to the contribution pa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... in the Reserve Bank or the State Bank of India or in such other scheduled banks as may be approved by the Central Government from time to time or be invested subject to the directions as the Central Government may from time to time give a securities mentioned or referred to in clauses ( a ) to ( d ) of section 20 of the Indian Trust Act, 1882. All expenses incurred in respect of, and loss, if any, arising from, any investment shall be charged to the fund. Para 53 provides that the fund not including the administration account shall be except with the previous sanction of the Central Government be expanded for any purpose other than the payment of the sums standing to the credit of individual member of the fund or to their nominees or heirs or legal representatives in accordance with the provisions of the scheme. All expenses relating to the administration of the fund including those incurred on Regional Committee are to be made from the fund in terms of para 54 of the scheme. Similarly all expenses of administration of fund including the fees and allowances of the trustees of the Central Board and salaries, leave and joining time allowance, travelling and compensatory allowances, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... efinition of the term consumer even a member of family of such consumer was held to be having the status of consumer . In an action by any such member of the family of beneficiary of the service it will not be open for a trader to take a stand that there was no privity of contract. In this regard this Court specifically held : "In the present case, we are concerned with clause ( ii ) of section 2(1)( d ). In the said clause a consumer would mean a person who hires or avails of any services and includes any beneficiary of such services other than the person who hires or avails of the services. When a young child is taken to a hospital by his parents and the child is treated by the doctor, the parents would come within the definition of consumer having hired the services and the young child would also become a consumer under the inclusive definition being a beneficiary of such services. The definition clause being wide enough to include not only the person who hires the services but also the beneficiary of such services which beneficiary is other than the person who hires the services, the conclusion is irresistible that both the parents of the child as well as the child would ..... X X X X Extracts X X X X X X X X Extracts X X X X
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