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TMI Blog2024 (7) TMI 538X X X X Extracts X X X X X X X X Extracts X X X X ..... he use/personal use of its directors would amount to purchase for "commercial purpose" within the meaning of Section 2(1)(d) of the Consumer Protection Act, 1986 (now re-enacted as Consumer Protection Act, 2019)? 2. The CA No. 353 of 2008 has been filed by the appellant - M/s Daimler Chrysler India Pvt. Ltd., now known as Mercedes Benz India Pvt. Ltd. (original opponent no. 1) arising out of the Original Petition No. 09 of 2006 filed by the respondent no. 1 - M/s Controls and Switchgear Company Ltd. (original complainant), challenging the impugned judgment and order dated 17.09.2007 passed by the National Consumer Disputes Redressal Commission (hereinafter referred to as the National Commission), in the said O.P. No. 9/2006. 3. The CA Nos. 19536-19537 of 2017 have been preferred by the appellant - Mercedes Benz India Pvt. Ltd. and Anr. (original opponent nos. 1 and 2) arising out of the Consumer Case No. 51 of 2006 filed by the respondent no. 1 - CG Power and Industrial Solutions Ltd. and Mr. Sudhir M. Trehan, M.D. of respondent no. 1, (original complainants), challenging the impugned orders dated 08.07.2016 and 11.09.2017 passed by the National Commission in the said C.C. No. 51 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Ltd. Vs. G.S. Fertilizers Pvt. Ltd. II (2013) CPJ 72 (NC) in which it was held inter alia that the vehicle purchased by a company for its Managing Director would amount to its purchase for a commercial purpose, the matter was referred to the three-member Bench of the National Commission. The three-member Bench in the Consumer Complaint No. 51 of 2006 vide the impugned judgment and order dated 08.07.2016 held as under: "11(a) If a car or any other goods are obtained or any services are hired or availed by a company for the use/personal use of its directors or employees, such a transaction does not amount to purchase of goods or hiring or availing of services for a commercial purpose, irrespective of whether the goods or services are used solely for the personal purposes of the directors or employees of the company or they are used primarily for the use of the directors or employees of the company and incidentally for the purposes of the company. (b) The purchase of a car or any other goods or hiring or availing of services by a company for the purposes of the company amount to purchase for a commercial purpose, even if such a car or other goods or such services are incidentall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he vehicle, in consultation with AAUI. (iv) The opposite parties No.1 & 2 shall pay a sum of Rs. 25,000/- as the cost of litigation to complainant No.1. (v) The payment in terms of this order shall be made and the directions contained herein will be complied within three months from today." 8. As stated earlier, the said two orders 08.07.2016 and 11.09.2017 passed in Consumer case no. 51 of 2006 have been challenged by the appellants-Mercedes Benz by way of C.A. No. 19536-19537 of 2017. The Cross Appeal being C.A. No. 2633 has been preferred by M/s CG Power and Industrial Solutions Ltd. (original complainant), being aggrieved by the judgment and order dated 11.09.2017 passed by the National Commission. 9. The common bone of contention raised by the learned counsels appearing for the appellants - M/s Daimler Chrysler India Pvt. Ltd., (now Mercedes Benz India Pvt. Ltd.) in their respective Appeals is that the purchase of car/vehicle by a company for the use/personal use of its directors could not be said to be the purchase of vehicle for self-employment to earn its livelihood, but it has to be construed as the purchase of vehicle for "commercial purposes", and therefore such ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 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-tobusiness 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." 13. Further in the case of Shrikant G. Mantri vs. Punjab National Bank (2 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tury Dictionary); it means "connected" with or engaged in commerce; mercantile; "having profit as the main aim" (Collin's English Dictionary); relate to or is connected with trade and traffic or commerce in general, is occupied with business and commerce. 16. The Explanation [added by Consumer Protection (Amendment) Act 50 of 1993 replacing Ordinance 24 of 1993 w.e.f. 18-6-1993] excludes certain purposes from the purview of the expression "commercial purpose" - a case of explanation to an exception to amplify this definition by way of an illustration would certainly clear the clouds surrounding such interpretation. For instance, a person who buys a car for his personal use would certainly be a consumer, but if purchased for plying the car for commercial purposes, namely, as a taxi, it can be said that it is for a commercial purpose. However, the Explanation clarifies that even purchases in certain situations for "commercial purposes" would not take within its sweep the purchaser out of the definition of expression "consumer". In other words, if the commercial use is by the purchaser himself for the purpose of earning his livelihood by means of self-employment, such purchaser ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the CA No. 353/2008 is concerned, it appears that as per the case of the respondent no. 1 (original complainant), it had purchased two cars for the use by its Whole-time Executive Directors as part of their perquisites and the said high priced luxury cars were in fact being used by them for their personal use and for the use of their immediate family members. It was strenuously urged by the learned senior counsel Ms. Arora for the appellant that if the car in question was purchased by the respondent no. 1 for the personal use of its Director, it must carry a requisite form attested by the Chartered Accountant along with the Income Tax returns of the concerned Director, and since such document or form having never been submitted and produced before the Commission, it was required to be presumed that the car was purchased by the respondent no. 1- company for its commercial purpose. Such a submission could not be accepted. It is trite to say that when a consumer files a complaint alleging defects in the goods purchased by him from the opponent seller, and if the opponent-seller raises an objection with regard to the maintainability of the consumer complaint on the ground that the goo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is pertinent to note that in the letter dated 21.08.2003, it was stated by the appellant that "although the area (center hump) was observed to be warm, it is not a defect". In its letter dated 02.07.2004, the respondent no. 2 who happened to be the dealer of the appellant required the complainant company with regard to the center hump to keep it under observation over a longer distance and to report the matter in case of any abnormalities, had confirmed that the AC control unit was found to be defective. Thereafter, on the respondent-company having made the complaint of excessive heating on the center hump more prominently on long drives out of station, the car was once again inspected by the engineers of the appellant-company, who had informed the respondent-complainant vide letter dated 03.12.2004 that "on account of the catalytic converter fitted underneath the car, these cars do heat a lot", and advised that "the matter could be resolved by adjusting the rear air-conditioning vents suitably". It appears that thereafter repeated requests/complaints having been made by the respondent complainant, the respondent no. 2 wrote vide the letter dated 22.12.2004 that the exhaust pipe o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 36 3 14.35 41632 17.00 51 35.5 4 16.11 41673 19.1 50 34 5 17.22 41723 19.6 53 34.5 6 19.23 41769 19.4 49 36.5 7 20.18 41823 17.4 48 35 21. Again, the National Commission having passed the order on 25.09.2006, appointing the Local Commissioners for measuring the temperature of the hump of the car, in presence of representatives of both the parties, the Local Commissioners had travelled on 07.10.2006 in the car in question for more than 300 kms. towards Rishikesh side, and submitted the report regarding the temperature of the running car at a distance of every 50 kms. as under: S. No. Time Km. Temp. gauge 1 of DCIPL (Degree) Temp. gauge 2 of C & S (Degree) Ambient (Degree) 1. 8.30 AM 43649 33.2 39 25.5 2. 9.45 AM 43699 38.6 46 30.5 3. 10.45 AM 43749 38.6 47 32 4. 11.05 AM 43759 39.5 47 34 5. 12.40 PM 43799 38.6 46 32 6. 1.55 PM 43850 37.3 47 32 Return Journey 7. 4.00 PM 43866 35.7 39 35 8. 5.00 PM 43899 37.3 47 33 9. 6.00 PM 43950 38.1 46 29 10. 7.50 PM ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed, the appellant had moved the applications seeking permission of the Commission to make one more effort by providing additional insulation, and also for permitting the appellant to repurchase the car in question for the market value/book value as it existed at the relevant time in 2007. The market value of the car in question as on 25.11.2006 was stated to be Rs. 34 lakhs, and the book value thereof as on 31.12.2006 was stated to be about Rs. 36 lakhs. The appellant though not admitted specifically about the said defects in the car, had indirectly stated in the said application seeking permission to provide additional insulation to the effect that the warm surface of hump/tunnel was a natural physical characteristic of the car and hence could not be altered to a large extent and that the additional insulation could be fitted by a minor modification. The said statements in the said applications read with the other materials/documents on record as also the reports of the Local Commissioner appointed by the National Commission, has led us to come to an irresistible conclusion that the inherent defect of overheating of the car in question had persisted despite the appellant having pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed and used the car in question for about seventeen years, we are of the opinion that the interest of justice and balance of equity would be met if the respondentcomplainant is permitted to retain the car in question and the appellant is directed to refund Rs. 36 lakhs instead of Rs. 58 lakhs as directed by the National Commission in the impugned order. II. CIVIL APPEAL NOS. 19536-19537/2017 AND 2633/2018 26. So far as C.A. No. 19536-19537/2017 filed by the appellants - Mercedes Benz India Private Ltd. and another (Original Opponents) and the cross Appeal being C.A. No.2633 of 2018 filed by M/s C.G. Power and Industrial Solutions Ltd., (Original Complainant No.1) arising out of Consumer Complaint No. 51/2006 are concerned, as stated hereinabove, after the challenge of the order dated 08.07.2016 passed by the National Commission in the said case, before this Court by way of filing C.A. No.10410/2016, this Court had disposed of the said Appeal by directing the National Commission to adjudicate the dispute between the parties finally, leaving it open for the appellant Mercedes Benz to challenge the order on maintainability as well as the final order. Accordingly, the final order ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ccording to the respondents-complainants, if the airbags had opened at the right time, as represented by the appellants25 opponents, the respondent no. 2 might have suffered less or no injuries. The complainants had also filed an FIR with the police station at Nasik on 17.01.2006. On 20.01.2006, the car was taken by the respondent No. 3 being authorized service centre and a detailed inspection and assessment of cost for the repairs was made. It was also alleged that in number of cases the airbags had failed to deploy at the time of accidents and people had suffered grievous injuries or had died also. Due to the said accident, not only that respondent no.2 had suffered grave injuries, agony and mental trauma, his family members and the respondent-company itself, had suffered lot of inconvenience and financial loss. It appears that lot of correspondence had ensued between the parties, and ultimately the respondents-complainants had filed the complaint seeking compensation under the various heads. 29. On the maintainability of the complaint, though the learned Senior Advocate Mr. Dhruv Mehta had strenuously urged that the purchase of the car by the respondent no. 1 company for the us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the respondents-complainants however vehemently submitted that admittedly neither the front airbags nor the side airbags of the car deployed as a result of the accident. The appellants had not produced on record the owner's manual and the features of the airbags given in the owner's manual on record produced by the complainants did not disclose as to what was the pre-determined level at which the airbags would deploy. According to him, the appellants had misrepresented that their car was the safest place on the road and that the provision of airbags was an additional safety measure not only for the front passengers but also for the rear passengers. According to him, since the owner's manual did not contain accurate and complete information as regards the safety measure of airbags, and the appellants having misrepresented about the safety measures at the time of the promotion of the car, it was rightly construed as an "unfair trade practice" on the part of the appellants by the Commission, however, the Commission had committed an error in not awarding exemplary damages to the respondents-complainants. 32. In the instant case, there are certain undisputed facts as transpiring fr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , admittedly, there was no impact on the side of the car in which complainant no.2 was sitting at the time of the accident, the side airbag would obviously not have triggered. Even otherwise the airbags on the side will not trigger in the event of frontal accident unless the airbags system is such as to trigger every airbag irrespective of the side on which the impact occurs in an accident. Similarly, window bags which are independent of the front airbags also trigger on the side on which the impact occurs. Therefore, the window airbags would not have triggered in this case since there was no impact on the sides on which the window bags were provided in the vehicle. 10. As far as the front airbags are concerned, it is stated in the Manual that they are triggered if (i) a front-end impact occurs (ii) if collision happens at a force exceeding a 'predetermined level.' The Manual however, does not disclose as to what the said predetermined level was. If the front airbags were not to deploy in every accident resulting in front end impact, the opposite parties, in my view, ought to have disclosed to the buyers as to what the predetermined level necessary to trigger the front passenger ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... vehicle was smashed when it was hit by the truck and the collision of car with the truck was quite impactful. 36. There was nothing on record produced by the appellants to show that they had disclosed either in the Owner's Manual or in the Brochure about the limited functioning of the airbags, which according to them was an additional safety measure in the car. On the contrary, as per the case of the respondents-complainants a misrepresentation was made by the appellants at the time of promotion of the car in question that e-class car had a safety system which included front airbags, side-airbags and window airbags. Even if it is accepted that the airbags would deploy only when the seat belt was fastened by the passenger, in the instant case admittedly, the frontal airbags of the car were not deployed though the driver had already fastened the seat belt. Thus, the defect in the car was clearly established so far as non-deployment of frontal airbags was concerned. 37. Incomplete disclosure or non-disclosure of the complete details with regard to the functioning of the airbags at the time of promotion of the car, has rightly been considered by the National Commission as the "unfair ..... X X X X Extracts X X X X X X X X Extracts X X X X
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