The Supreme Court emphasized the importance of adopting a liberal interpretation of the provisions within the Consumer Protection Act, 1986 to effectively serve its intended purpose. The legislative intent behind the Act should guide the interpretation process, ensuring that consumers' interests are prioritized and upheld.
Brief Facts of the Case:
A Civil Appeal was filed before the Supreme Court challenging the impugned order and judgment of the National Consumer Disputes Redressal Commission.
Brief Background of the Case:
The appellant was an association created by the allottees and registered under the Haryana Registration and Regulation of Societies Act, 2012. They approached the National Consumer Disputes Redressal Commission (hereinafter referred to as “the National Commission”) with complaints against the respondent, a builder responsible for a housing project.
The complaints alleged that the respondent failed to construct and complete the promised flats within the agreed timeline, did not provide compensation for the delay caused, and questioned additional demands. The complaints were initially filed on behalf of 54 allottees and later by others as well. Following an interim order in one of the complaints, both parties completed pleadings and filed affidavits. The respondent then filed a writ petition before the High Court of Delhi, which was stayed by a higher court's order.
However, during this time, the respondent filed a complaint with the District Registrar of Societies, claiming that the aims and objectives stated in the appellant association's bylaws did not comply with the HRRS Act. The District Registrar referred the matter to the State Registrar, Haryana. The State Registrar instructed the appellant to amend its bylaws within six months, warning that failure to comply would result in the cancellation of their registration. Dissatisfied with this decision, the appellant appealed to the Registrar General, Haryana. While waiting for the proceedings before the Registrar General, Haryana, the appellant amended its bylaws, which were duly registered by the District Registrar, Gurugram.
Procedural History:
The National Commission scheduled a hearing for the complaint on a specific date but adjourned it indefinitely after being informed of the State Registrar's order. The adjournment was to await the outcome of the appeal before the Registrar General, Haryana. The appellant applied to the Registrar General, Haryana, in the ongoing appeal, requesting to include the amended bylaws and seeking a stay. The appellant also filed a writ petition before the High Court of Punjab & Haryana, requesting the Registrar General, Haryana, to decide the interim applications promptly.
During the proceedings before the Registrar General, Haryana, the respondent raised a contention based on a notice issued by the Department expressing its intention to cancel the registration. Consequently, the Registrar General, Haryana, issued an order preventing the cancellation of registration. Given the circumstances above, the appellant applied to the National Commission, requesting to include the amended bylaws along with the stay order granted by the Registrar General, Haryana, and seeking the revival of the proceedings.
The application was granted, and the documents were accepted. However, the respondent later filed a review application to recall the order. Subsequently, the District Registrar, Gurugram, put the certified amendments on hold, citing the expiration of the granted six-month period. The Registrar General, Haryana, dismissed the appeal, finding no error in the State Registrar's order, although the appellant's registration was not cancelled.
The orders issued by the State Registrar and the Registrar General, Haryana, were challenged before the High Court of Punjab & Haryana in a writ petition along with a stay application. The matter is still pending adjudication, and no interim order has been issued. In the review application filed before the National Commission, the respondent submitted an additional affidavit, relying on an order of the Registrar General, Haryana, which is currently under consideration by the High Court. The appellant also informed the National Commission about the pending writ petition and stay application. Consequently, all the matters, including the interlocutory applications, were adjourned, awaiting appropriate orders in the writ petition. The appeals were filed to challenge the orders passed by the National Commission.
Contentions of the Appellants:
The appellant's counsel argued that the respondent is actively trying to hinder the appellant's access to legal remedies. The complaints filed in 2017 have not yet been properly resolved. The pending writ petition has no connection to the proceedings before the National Commission. The appellant is not seeking to represent the interests of the general public against the appellant's members. Furthermore, since individual allottees have already filed affidavits, the National Commission made an error in indefinitely adjourning the matters.
Contentions of the Respondents:
The respondent's counsel argued that if the appellant's registration is invalid, then the complaint itself would be considered not maintainable. Even if an individual complaint could be considered, it should be addressed by a District Consumer Disputes Redressal Commission. Since the High Court has not issued a stay on the orders passed by the State Registrar and the Registrar General, there is no flaw in the challenged orders.
Observations of the Court:
The Supreme Court concluded that The Consumer Protection Act, 1986 (hereinafter referred to as "the 1986 Act") and the Consumer Protection Act, 2019 (hereinafter referred to as "the 2019 Act") have a commendable objective of protecting consumer interests and promoting consumerism in the country. The provisions of the 1986 Act should be interpreted liberally to fulfil its purpose. The recent decision in National Insurance Co. Ltd. v. Harsolia Motors[2023 SCC OnLine SC 409] supports this approach. The Act aims to protect consumers who would otherwise lack effective remedies under ordinary law. It enables consumers to participate directly in the market economy. The provisions of the Act should be construed in favour of consumers while considering the legislative intent.
The Apex Court further clarified that the appellant's complaints were filed under Section 2(b) and Section 12 of the 1986 Act. These provisions require a broad and inclusive interpretation. Section 21 of the Consumer Protection Act establishes the jurisdiction of the Commission based on the value of goods or services and compensation claimed. For complaints filed under Section 12(1)(c), where numerous consumers with the same interest are involved, all consumers' aggregate value of goods/services and compensation claims determine the jurisdiction. The value and compensation claimed by individual consumers are irrelevant to determining the jurisdiction in such cases. This issue has already been settled in the case of Public Health Engineering Department Vs. Upbhokta Sanrakshan Samiti [(1992) CPJ 182 (NC)].
The decision of the Court:
The Supreme Court quashed the impugned order and judgement of the National Commission. Therefore, the Supreme Court allowed the appeals.
Case Title: Alpha G184 Owners Association Vs. Magnum International Trading Company Pvt. Ltd.
Case No.: Civil Appeal No. 4718 of 2022
Citation: 2023 Latest Caselaw 487 SC
Coram: Hon'ble Mr. Justice J.K. Maheshwari and Hon'ble Mr. Justice M.M. Sundresh
Advocates for Petitioner: Mr. Narender Hooda, Sr. Adv., Mr. Rahul Rathore, Adv. and Ms. Priyanjali Singh, AOR
Advocates for Respondent: Mr. Vas Dev Verma, Adv., Mr. Kanishk Aggrawal, Adv. and Mr. Debesh Panda, AOR
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