Raising water tariff: Punish the good and excuse the defaulter

The news of Minister S.A.Ramdas instructing MCC to maintain the old water rates and not implement the 3- to 5-fold hike has been welcomed by many, but this is not the legal way of rescinding a rate hike. The hike was also probably illegal and so two illegalities may cancel each other!

MCC seems to have a habit of illegally imposing taxes and hiking existing taxes. The last time it hiked the water rates in 2005, the High Court quashed it as illegal on 25-10-05 (in Writ Petition No. 19047 of 2005). Many of the cesses and taxes it collects along with the property tax are illegal. In spite of having a legal department, it is surprising that MCC can not get things right legally.

There seems to be no rationale for increasing the water tariff. In the field of electricity, the law says that the electric supply company can make a profit equal to the government interest rate. So an ESCOM can add all its expenditures, add the interest rate and this will be the revenue it will have to generate. The power rates are adjusted to achieve this goal. But VVWW does not know or does not want to publish its expenditures. Systemic inefficiencies like losses due to water leakage and pilferage (estimated at upwards of 50%), inefficient electric motors that raise electricity bills for pumping water, or failure to collect water dues from defaulting consumers while continuing to supply water to them over months and years, have not been addressed.

According to statistics revealed by the minister, there are 175,000 water connections in the city, but only 116,000 connections are being billed. So 59,000 (33%) connections are getting water without paying. Even among the connections that are billed, a significant percentage do not pay. According to information given under the RTI Act, there are more than 40,000 water bill defaulters who owe Rs. 57.58 crores to VVWW. The authorities, instead of punishing the guilty, keep announcing interest waivers to the defaulters, but the dues keep climbing. The minority of honest tax payers are burdened with an ever-increasing load of taxes and tariffs.

VVWW and MCC should place a detailed accurate analysis of the economics of Mysore's water supply in the public domain, and raise water tariff only if absolutely unavoidable, but after due administrative and legal process.

Maj.Gen.(Rtd.) S.G. Vombatkere, Mysore Grahakara Parishat

Water tariff hike

The huge hike in water tariffs in Mysore city is in all the papers and is the hottest topic of discussion among Mysoreans. Let us examine how a water tariff hike can be effected. 

According to Sec. 191 of the Karnataka Municipal Corporations Act, 1976, payment for water usage should be made at such rates, at such times and under such conditions as may be specified by bye-laws. Sec. 220 (1) of the Act states that MCC may make bye-laws relating to water supply. Therefore, MCC can effect a water tariff hike by making a bye-law. Let us now see how MCC can make a bye-law. 

According to Sec. 426 of the Act, a draft of the bye-law should be published in the Gazette and the local newspapers. It should be available for inspection by the public for at least one month till which time no action should be taken on the draft bye-law. 

Once the bye-law is made by MCC, it must be sanctioned by the state government (Sec. 425 of the Act) and published in the gazette (Sec. 428 of the Act). The bye-law will come into effect three months after it has been published in the gazettes (Sec. 428 of the Act).  

Sec. 427 of the Act permits the state government to make rules in place of bye-laws. Such rules will override any bye-laws made by MCC. But before making the rule, the state government should issue a notice to MCC asking it to show cause for not making a rule.  

Therefore, water tariff can be changed in two ways only, making a bye-law by MCC or making a rule by the state government. It is not clear which route was taken in the present water tariff hike. If the bye-laws were changed without publishing the draft in the local newspapers, the bye-law change and hence the tariff hike would be illegal. If, on the other hand, the state government made a rule without issuing a show cause notice to MCC, the tariff hike would again be illegal.

P M Bhat, MGP

Photos from the May 2012 issue of Grahaka Patrike

(B.V.Shenoy)

Students of Sri Kaginele Kanaka Gurupeetha Teachers College who participated in the World Consumer Day celebration by MGP on 15-3-12 were given certificates at a simple ceremony at MGP office.

(D.V. Dayanand Sagar)

The footpath at the bus stop at Dasappa Circle is about 20 inches high. It is knee-high even for tall people. How can elderly people, women and children get down from this high footpath and get on a bus?

(D.V. Dayanand Sagar)

The widening of Dhanvantari Road near Dasappa Circle has left it with no footpath. So "footpath" vendors have set up shop on the storm water drain itself!

(D.V. Dayanand Sagar)

Dozens of bus stops all over the city have been replaced by hi-tech bus stops. But the old bus stops have not been demolished. They have become an eye-sore.

Problems With Consumer Courts

The Mysore District Consumer Forum recently ruled (8-3-12 in Case No. 993/2010)  that a person who applies for information under the Right to Information Act, 2005 (RIA) is a consumer under the Consumer Protection Act (CPA) and failure to provide information asked under the RIA is a deficiency in service under the CPA. It ordered the DDPI, Mysore, who failed to provide information, to pay a compensation of Rs. 4000 to the complainant as well as Rs. 2000 as costs. This judgment exposes many problems which exist in the consumer court system.  

Firstly, the decision of the Mysore DCF relied on a decision of the National Consumer Commission given on 28-5-09 which said that failure of public authorities to provide information under the Karnataka Right to Information Act, 2000 constitutes deficiency of service under the CPA. The case before the Mysore DCF was concerning an application for information given under a different law, RIA, which is a central act. In its order, the Mysore DCF says "As rightly submitted by the complainant's learned counsel, in the case arising out of this Forum itself, the Hon'ble National Commission has already held in the case of Dr. Thirumala Rao V/s City Corporation, Mysore in Revision Petition No. 1975/2005 that the failure of the concerned officer to furnish the information sought for by the applicant under RTI Act is a deficiency in service and the complaint is maintainable under the C.P. Act in respect of such deficiency in service" and proceeds to punish the DDPI for deficiency in service. But it fails to realize that the National Commission's ruling related to Karnataka Right to Information Act, 2000 while the complaint before it was related to a different Act, namely, the central RIA. Since the number of Dr. Thirumala Rao's Revision Petition before the National Commission is 1975/2005, obviously it was filed in 2005 and so the original complaint must have been filed before 2005 (It was actually filed in 2003) while the RIA was implemented only in 2005. So it is clear that Dr. Thirumala Rao's complaint must have been under a law different from the RIA. But the Mysore DCF failed to appreciate this important point. Since Karnataka Right to Information Act, 2000 was repealed in 2005 itself and is no longer in effect, the decision of the National Commission was not relevant to the case before the DCF.  

It still would have been alright if the National Commission had not passed any order concerning the relevant issue of whether consumer courts have jurisdiction in RIA cases. Then Mysore DCF could have drawn a parallel between the Karnataka Right to Information Act, 2000 and the RIA and passed correct orders. But the National Commission has passed an order concerning the jurisdiction of consumer courts in RIA cases, and what is worse, has passed an opposing order. In Revision Petition No. 4061 of 2010 decided on  14-9-10, the National Commission has ruled that a person who has filed a petition under the RIA cannot be termed to be a consumer under the CPA. According to this decision of te National Commission, public authorities who do not provide information under the RIA can not be prosecuted under the CPA. So the decision of the Myosre DCF is in direct violation of the National Commission order on RIA cases.   

Secondly, this decision of the National Commission, though very important (this might be the only decision the National Commission has given till now concerning the jurisdiction of consumer courts in RIA cases), is not available in the website confonet.nic.in which is maintained by the Government of India and which is supposed to contain all the judgments given by all the consumer courts in the country. We found the reference to the National Commission judgment in the RIA website. In this order, the National Commission upheld a decision of the the Karnataka State Consumer Commission which was being appealed against. The decision of the Karnataka State Commission is also not available on confonet.nic.in website.The decisions of the State Commission and the National Commission are binding on lower consumer courts. If they are not put on confonet.nic.in, how will the lower courts come to know what the upper courts have ordered? What precedents will they follow? Obviously, the Mysore DCF was not aware of this decision of the State Commission or the National Commission since they are nowhere mentioned in the judgment of the DCF.  

Thirdly, this decision of the Karnataka State Commission upheld by the National Commission is flawed. It says that a person who does not receive information sought under the RIA cannot be considered a consumer under the CPA since there is a remedy available for the complainant to approach the appellate authority under Section 19 of the RIA. It is well-established that the Consumer Protection Act is an additional remedy available to consumers even when there is another law which is applicable. Unless there is an express provision in the other law which ousts the jurisdiction of the Consumer Protection Act (such as the Railway Claims Tribunal Act regarding railway claims or the Motor Vehicles Act regarding compensation in road accidents), one can always make use of the Consumer Protection Act as an easy and inexpensive means of obtaining justice. This fact has been reiterated countless times both by the National Commission and the Supreme Court. So the judgment of the Karnataka Commission and the National Commission that consumer courts can not decide RIA cases violates earlier orders of the National Commission and the Supreme Court.

In fact, the same point had been stressed in the earlier decision of the National Commission in Dr. Thirumala Rao's case. It is likely that both Karnataka State Commission and the National Commission were not aware of this earlier decision of the National Commission. This again illustrates the information gap in the consumer court system.

RIA provides only for punishment of officials who do not provide information to applicants. Though there is a provision for compensating the loss suffered by the applicant due to non-supply of information, we are not aware of any case in which such compensation has been awarded. Under CPA, obtaining compensation for the loss suffered by the complainant is routine. So the CPA provides better justice than the RIA.

In summary, the present case exposes the following problems affecting consumer courts: 1. There is a communication gap and the consumer courts (and the consumers) are not sufficiently aware about the decisions given by other consumer courts and by themselves at an earlier time. This has resulted in mutually contradictory decisions and decisions which violate decisions of higher courts.
2. Judgments of higher courts which are binding on lower courts are not being strictly followed and this is creating judicial confusion.
3. Judgments of higher courts which are not relevant are being followed as binding precedents and this is also increasing judicial confusion. 

A final word on RIA and CPA. Now, an NGO of Hyderabad by the name Gareeb Guide International has filed a PIL before the Supreme Court to resolve the problem of conflicting decisions of the National Consumer Commission on whether an applicant under the RIA can take recourse to the CPA if he does not get the information sought.

B.V. Shenoy, Mysore Grahakara Parishat

More Megastore misleads the public

More Megastore on Narayana Shastri Road, Mysore issued a large front page advertisement in a national newspaper on 1st May offering huge discounts on various items of merchandise. Tempted by the ad, I went to More Megastore on the morning of the 1st and found a large crowd who had also been enticed by the same advertisement. But to our surprise, we were told that the store had no authorization to offer the discounts mentioned in the advertisement. So all of us had to return disapppointed.

How can a supermarket issue an expensive advertisement in a major newspaper and not honour it? Is this not unfair trade practice? Thousands of people must have been lured by the advertisement to make a fruitless trip to the store. Who will reimburse their needless expenditure? Will More Megastore explain?

P M Bhat, Mysore Grahakara Parishat

Supply of substandard seeds is punishable under Consumer Act

Stories about farmers protesting against poor quality seeds appear very often in the newspapers. Most of the seeds fail to germinate, the year's crop is lost and the farmers are driven to desperation. Seed failure is one of the main reasons for farmer suicides. Normally, supply of defective seeds comes under the purview of the Consumer Protection Act and the farmers can approach the consumer courts and obtain compensation for the loss they have suffered because of seed failure.

Recently, several District Consumer Fora of Andhra Pradesh ruled against National Seeds Corporation for selling defective seeds. The company appealed before the Andhra Pradesh State Consumer Commission and the National Consumer Commission, but lost both the appeals. It then appealed to the Supreme Court arguing that complaints againt defective seeds should be filed under the National Seeds Act, 1966 and not under the Consumer Protection Act. It also argued that thefarmers were not consumers under the Consumer Protection Act since they had purchased the seeds for a commercial purpose.

In a judgment given on 16-1-12 (I (2012) CPJ 1 (SC)), the Supreme Court rejected these arguments. It said that the National Seed Act deals with only the prosecution of the vendors of defective seeds, but is totally silent on the issue of payment of compensation for the loss of crop on account of defective seeds. To get compensation for the loss they have suffered, the only course open to the farmers is filing a complaint under the Consumer Protection Act. Since the Consumer Protection Act is in addition to the Seed Act and not in its derogation, there is no bar on filing complaints against defective seeds under the Consumer Protection Act. Since the farmers were growing crops to earn their livelihood, the Supreme Court said the argument that they had a commercial purpose was not valid.

After dismissing the appeal of the Corporation, the Supreme Court imposed court costs of Rs. 25,000 to be paid to each farmer who had filed cases against it. It would have been even better if the Supreme Court had ordered the Corporation to pay a sum to compensate the loss of hundreds if not thousands of other farmers who lost their livelihood due to the defective seeds supplied by it.

National Seeds Corporation is a Government of India undertaking and is a "Mini- Ratna" company. It was started to help the poor farmers of India by providing them with affordable good quality seeds. It is surprising that the Corporation is not only derelict in it duty of supplying quality seeds but is also harassing the farmers by appealing all the way to the Supreme Court with frivolous objections.

G.L.Nagaraj Urs, Mysore Grahakara Parishat