Photos from the Grahaka Patrike

MGP held a meeting at People's Park on 28-6-14 to protest encroachment of the park.

Several schools had brought their children to the protest. 

There was a classical music programme at the protest meeting

A Surprising Decision by the National Commission

In a recent decision (II (2014) CPJ 1 (NC)), the National Consumer Commission has ruled that if a person buys two apartments, he must be buying the second one for reselling, that would make the purchase a commercial activity and so if he has any problems with either of the apartments, he can not approach consumer courts. This is quite surprising because it limits the scope of the Consumer Protection Act significantly and is also against the intent of the parliament in enacting the Act.

In the case before the National Commission, one Sunil Gupta had booked two flats from a builder, one for his son and one for his daughter. There was a problem with the delivery of the apartments and Gupta approached the National Commission with a complaint of deficiency in service. The National Commission said that when a consumer has booked more than one unit of residential premises; it amounts to booking of such premises for investment/commercial purpose. Therefore, the Commission said, he was not a consumer under the Consumer Protection Act and his complaint was dismissed.

There are three problems with the National Commission decision. Firstly, it appears that the National Commission has chosen an anti-consumer stand in it order. It calls the statements made by Gupta “namby-pamby” without explanation. When the consumer has stated that the two apartments are for his son and daughter, the Commission seems to disbelieve him and assumes that the apartments have been bought to resell and make profit. The Supreme Court has said on numerous occasions (e.g. III (1993) CPJ 7 (SC)) that consumer courts must lean towards the consumer as much as possible. Consequently, the consumer's averments should be taken on face value unless there is evidence to the contrary.

Secondly, the decision of the National Commission to treat all investments as commercial is not correct. According to Black's law dictionary, an investment is an expenditure which provides revenue. So even a bank deposit is an investment because the interest on the deposit provides revenue. Deposits in post offices, shares, mutual funds are all investments because they all provide revenue. If all these are investments, then they are all “commercial” in nature and hence should be outside the purview of CPA. But the National Commission and the Supreme Court have given innumerable decisions in which these investments have been kept within the ambit of the CPA. Just because it is an investment does not make it “commercial”.

Thirdly, even if Gupta really had intended to resell the apartments, it still does not rule out the applicability of CPA. When the CPA was originally enacted, it permitted any person (or company or society) who had availed of a service to file a complaint before consumer courts if the service was deficient. It was soon discovered that under this provision, large companies were filing complaints which was defeating the very purpose of the Act, which was to provide quick and inexpensive justice to ordinary consumers. So the Act was amended to exclude services availed for a commercial purpose. It is clear that the parliament wanted to exclude only commercial activity on a large scale from the purview of CPA. This is acknowledged in a Supreme Court judgement (II (1995) CPJ 1 (SC)) . The Supreme Court order also quoted the Concise Oxford Dictionary which defines commercial as “pertaining to commerce” and commerce as “financial transactions especially buying and selling of merchandise, on a large scale”. Thus it is obvious that individual consumers are not excluded from consumer courts even when they use the goods or services purchased to make profit. The intent of the law is to exclude only large companies from misusing the consumer court mechanism.

The surprising thing is, the National Commission in the past has almost consistently taken the position that only individuals who purchase goods with the intention of carrying on any activity on a large scale for the purpose of earning a profit are excluded from the purview of CPA. This fact was noted in the Supreme Court judgement. The present decision of the National Commission is contrary to its earlier positions. The lower consumer courts are sure to be confused by this development. It is likely that the consumers will feel the resultant negative effects.

Christopher Mwangovya

Photos from the Grahaka Patrike

 (B.Vaikunth Shenoy) 

Prof.A. Ramalingam and a team of experts (Dr. Rathi Rao, Prof. Shankar Bhat and Prof. Keshav Nireshwalia) visiting Vijayanagar Central Water Storage Reservoir when ots roof collapsed 

(N.S. Lakshminarayana) 

Prof. A. Ramalingam and C.V. Nagaraj of MGP in the environmental summer camp for school children.

( B.Basavaraju) 

Prof. A. Ramalingam distributing "I Will Not Sell Adulterated Tea" display board to a shop owner. Others in the photo, Dr.M.S. Vishweshwara of Bharat Cancer Hospital (3rd from left), Uma Shenoi and Prof. Kalachanne Gowda of MGP (4th and 5th from left) 

MGP's monthly meeting on 11-5-14 focussed on water problems. From left, Bhamy Shenoy and R.Chandra Prakash of MGP, Yoganand and Nandiswar of JUSCO.