Leelavati v. VSR Intratech Pvt. Ltd. and Ors. - (National Consumer Disputes Redressal Commission) (26 Jul 2017)

If goods bought and/or services availed are exclusively for purpose of earning livelihood by means of self-employment, such an activity shall not fall within definition of commercial purpose.

MANU/CF/0478/2017

Consumer

Present first appeals have been filed under Section 19 read with Section 21(a)(ii) of Consumer Protection Act, 1986 against impugned orders, passed by State Commission . Vide these orders, State Commission dismissed complaints on ground that, both complainants had booked property with Respondent/OP Builders for commercial purpose and hence, consumer complaints were not maintainable. Main issue that merits consideration in these two cases is whether Appellants/complainants are covered under definition of 'Consumer' as contained in Consumer Protection Act, 1986 or not.

As per Section 2(d)(ii) of Consumer Protection Act, "Consumer" means any person who, hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purposes; For purposes of this clause, "commercial purpose" does not include use by a person of goods bought and used by him and services availed by him exclusively for purposes of earning his livelihood by means of self-employment.

"Explanation" says that, if goods bought and/or services availed are exclusively for purpose of earning livelihood by means of self-employment, such an activity shall not fall within definition of commercial purpose. In impugned order, State Commission have rightly observed that, merely taking such a plea will not entitle complainants to get the benefit of aforesaid "explanation". It was duty of Appellants/complainants to provide evidence that, booking of premises made by them was exclusively meant for earning their livelihood by means of self-employment only. They were required to explain to State Commission, whether they had any other source of income and kind of activity they wished to start on premises being purchased. During hearing before this Commission, learned counsel for Appellants/complainants stated that, premises in question had been booked for opening office of an Advocate and hence, meant for professional purpose and not for commercial purpose. It has also been explained in memo of appeal that, complainant had booked the unit for their own personal purpose and for their own livelihood and in no manner, they will utilise the units for commercial purpose. It appears necessary, therefore, that Appellants/complainants should be given a chance to lead evidence in support of their assertion that, they are covered under the 'Explanation' to section 2(d) of the Act.

In impugned order of State Commission, it has been observed that, an area of about 100 q. ft. can be said to be a personal office, but not office with area of 567 sq. ft. It is observed in this regard that, a decision with regard to the issue in question is to be taken, considering the facts and circumstances of the case in entirety. This view was expressed by Supreme Court in their land mark judgment in "Laxmi Engineering Works v. P.S.G. Industrial Institute", where it has been observed Explanation added by Consumer Protection (Amendment) Act 50 of 1993 (replacing Ordinance 24 of 1993) with effect from 18th June, 1993 is clarificatory in nature and applies to all pending proceedings. Whether purpose for which a person has bought goods is a "commercial purpose" within meaning of the definition of expression "consumer" in Section 2(d) of Act is always a question of fact to be decided in facts and circumstances of each case. A person who buys goods and use them himself exclusively for purpose of earning his livelihood, by means of self employment is within definition of expression "consumer".

In accordance with above view taken by Supreme Court, it is clear that a decision whether service being availed is for a commercial purpose, is to be taken based on entire facts and circumstances of case. There is no reason to agree with view expressed by State Commission in impugned order that, extent of area of premises involved, or investment required to be made, could be sole determining factor in deciding whether service being availed is for a commercial purpose. A unit may have an area of 500 to 600 sq. ft. also, but it may still be covered under Explanation of section 2(d) of Act, if Complainant is able to show that, service was to be availed by him exclusively for purpose of earning his livelihood by means of self-employment. It is imperative, therefore, that, State Commission is required to weigh pros and cons of whole issue in letter and spirit, as laid down by Supreme Court in "Laxmi Engineering Works v. P.S.G. Industrial Institute" and then, conclude whether service sought to be availed is of commercial nature or not.

Matter deserves to be examined afresh by providing a chance to Appellants/complainants to lead evidence in favour of their assertion that the premises in question, were meant exclusively for purpose of earning their livelihood by means of self-employment and that, they propose to set-up an activity which shall not fall within definition of commercial purpose in terms of provisions of the Consumer Protection Act, 1986. Present appeals are, therefore, allowed, orders passed by State Commission are set aside and matters are remitted back to State Commission.

Relevant : Laxmi Engineering Works vs. P.S.G. Industrial Institute MANU/SC/0271/1995

Tags : COMPLAINT MAINTAINABILITY SERVICE AVAILMENT