1
Appeal filed on 21.12.2005Decided on 26.10.2006
BEFORE THE KARNATAKA STATE CONSUMER DISPUTES REDRESSAL COMMISSION, BANGALORE
Dated the 26th day of October, 2006
PRESENT
Hon’ble Mr.Justice Chandrashekaraiah, President
Smt. Rama Ananth, Member
Sri M.Shama Bhat, Member
APPEAL NO.2106/2005
M/s. MONTO MOTORS LIMITED,
Through its Directors,
D-33, Okhla Industrial Area-1, APPELLANT
New Delhi – 110 020 (Opposite Party No.1 before the District Forum)
(By Sri Rakesh Kakar, Advocate)
VERSUS
1.M/s. SRI SAI MOTORS,
through Shri G.Venkatesulu,
Residing at S.B.I. Colony,
Gandhinagar,
Bellary
2.M/s. TAJ MOTORS,
No.407, Brigade Tower,
Brigade Road, RESPONDENTS
Bangalore – 560 025 (Complainant & OP-2 before the District Forum)
(Sri B.Chidananda, Advocate
for Respondent No.1)
O R D E R
Hon’ble Mr.Justice Chandrashekaraiah:
For the sake of convenience the parties in this Order are referred to according to their position in the Complaint filed before the District Forum.
2This Appeal is by Opposite Party No.1 (for short, “OP-1”) challenging the Order of the District Forum allowing the Complaint of the Complainant in part.
3.The case of the Complainant before the District Forum was that he being an unemployed person wanted to start his own business to earn his livelihood. The Complainant having been attracted by a publication in the Newspaper approached OP-1 for appointment as Dealer of OP-1 at Bellary for Sales & Service of Cosmo range of Motorcycles, Avanthi brand Moped, Fun Bikes and spare parts etc. Accordingly, the Complainant was appointed as an Authorized Dealer of OP-1 on 17.9.2002. Pursuant to the appointment, the Complainant deposited a Security Deposit of Rs.2,00,000/- with OP-1. Thereafter, the Complainant opened “Cosmo Blaster Sales & Showroom” at Infantry Road, Sanjay Gandhi Nagar, Bellary. OP-2 being authorized distributor in Karnataka supplied 24 vehicles to the Complainant. As per the terms and conditions of the contract, the Complainant has cleared all the dues payable to OP-2 but OP-2 has not given him the Sales Commission and Discount as agreed to and also has not supplied the required stocks, required spare parts, kits etc., and, consequently, he has suffered substantial loss. Therefore, the Complainant filed Complaint before the District Forum for a direction to OP-2 to refund Rs.2,00,000/- towards the security deposit with interest at 18% per annum, Rs.4,500/- towards special discount, Rs.10,000/- towards advertising expenses and Rs.50,000/- towards mental agony.
4.OP-1 filed its Version before the District Forum. The case of OP-1 was that the Complainant is not a “Consumer” as defined in the Consumer Protection Act, 1986 as the dispute between the Complainant and OP-1 is ‘Commercial’ in nature. The further case of OP-1 was that as the Complainant is not a Consumer, the proper remedy for the Complainant is to approach the jurisdictional Civil Court for appropriate relief.
5.The District Forum after framing the issues on the basis of the pleadings of the parties has allowed the Complaint of the Complainant. The Order of the District Forum is under challenge by OP-1 in this Appeal.
6.It is not in dispute that the Complainant was appointed as a Dealer of OP-1. It is also not in dispute that the Complainant has deposited a sum of Rs.2,00,000/- as Security Deposit with OP-1. It is not the case of OP-1 that the Complainant has not fulfilled the terms and conditions of the contract entered into between the parties. The case of OP-1 is that since the contract between the parties is commercial in nature, the Complainant is not a Consumer as defined under the Consumer Protection Act. It is true that the Complainant was appointed as a Dealer to sell the vehicles manufactured by OP-1. The dispute between the Complainant and OP-1 relates to the refund of the Security Deposit and it has nothing to do with the vehicles supplied by OP-1 through OP-2 to the Complainant and re-sale of the said vehicles by the Complainant to third parties. Hence, the Complaint filed by the Complainant is maintainable, as the Complainant is a Consumer as there is a “Deficiency in Service” by OP-1 in not refunding the Security Deposit as per the terms of the contract.
7.OP-1 has produced a copy of Authority Letter issued to the Complainant, which is marked as Exhibit ‘R-1’. The said document reads thus:
“We certify that we have appointed M/s. Sri Sai Motors, as our Authorized Dealer for Bellary (Karnataka) for selling and servicing our Cosmo range of Motorcycles, Avanti brand of Mopeds, Fun Bikes and Spare Parts in the above mentioned area.”
Exhibit ‘R-2’ produced by OP-1 is a copy of Letter of Intent. Clause (1) relating to Security Deposit reads thus:
“ Security : Rs.2.00 lacs: Security amount will be returned at the time of withdrawal of dealership, subject to all outstanding cleared. In case of cancellation of dealership one month notice is required from either side to settle the account and Dealer’s Development Charges will not be given.”
From this Clause it is clear that the Security Amount will be refunded at the time of withdrawal of Dealership. It is also clear that in case of cancellation of Dealership, one month’s notice is required from either side to settle the account. In the instant case, it is not the case of OP-1 that the Complainant has not issued any notice to OP-1 calling upon it to refund the amount of Rs.2,00,000/-. OP-1 had written a letter to the Complainant stating that the Complainant is entitled to get Rs.2,00,000/- provided he submits a “No-Due Certificate’ issued by OP-2. Pursuant to the said letter, the Complainant has also produced No-Due Certificate issued by OP-2. After the receipt of the said No-Due Certificate, OP-1 ought to have refunded the Security Deposit. But, in the instant case, since OP-1 failed to refund the amount as per its own letter. Non-refunding of the amount by OP-1 as per its own commitment in its letter amounts to “Deficiency in Service”. Therefore, in our view, the District Forum is right in allowing the Complaint of the Complainant.
8.In the result, we pass the following Order:
(1)The Appeal is dismissed.
(2)Parties to bear their own costs.