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Rajeev Hitendra Pathan And Others v. Achyut Kashinath Karekar And Another
Factual and Procedural Background
The appeal challenges an order of the National Consumer Disputes Redressal Commission (“National Commission”) which held that a State Consumer Disputes Redressal Commission (“State Commission”) may restore a consumer complaint that had been dismissed for default. The Supreme Court granted leave to appeal and examined the statutory and precedent-based foundation of such restorative power.
Legal Issues Presented
- Whether a State Commission constituted under the Consumer Protection Act, 1986 has the jurisdiction to recall or restore a complaint that was dismissed for default/ex parte.
- What is the effect of the 2003 amendment introducing Section 22-A, which expressly confers a power of restoration on the National Commission but is silent as to State Commissions.
Arguments of the Parties
Appellant's Arguments
- Relied on Jyotsana Arvindkumar Shah v. Bombay Hospital Trust (1999) 4 SCC 325, which held that State Commissions have no statutory power to set aside ex parte orders.
- Highlighted that the 2003 amendment inserted Section 22-A giving an express power of restoration only to the National Commission, indicating legislative intent to withhold that power from State Commissions.
Respondents' Arguments
- Maintained that the National Commission correctly applied the facts of the present case and, following the rationale in New India Assurance Co. Ltd. v. R. Srinivasan (2000) 3 SCC 242, properly held that restoration by the State Commission was permissible.
Table of Precedents Cited
| Precedent | Rule or Principle Cited For | Application by the Court |
|---|---|---|
| New India Assurance Co. Ltd. v. R. Srinivasan (2000) 3 SCC 242 | Court or quasi-judicial body inherently possesses power to dismiss for default and to restore on sufficient cause. | Formed the basis of the National Commission’s view that State Commissions enjoy an inherent power of restoration; cited to illustrate one side of the jurisprudential divide. |
| Jyotsana Arvindkumar Shah v. Bombay Hospital Trust (1999) 4 SCC 325 | Consumer fora have no statutory authority to recall or review an ex parte reasoned order; absence of enabling provision in the Act. | Relied upon by the appellant and quoted extensively by the Supreme Court to show the contrary view held by a co-ordinate Bench. |
| CM, UCO Bank v. Ram Govind Agarwal (Bihar State Commission) | No power in consumer fora to recall ex parte orders. | Referenced within the quotation from Jyotsana to support the restrictive position. |
| Director, Forest Research Institute v. Sunshine Enterprises (National Commission) | No power in consumer fora to recall ex parte orders. | Also referenced in the Jyotsana quotation to illustrate the same restrictive view. |
Court's Reasoning and Analysis
The Supreme Court observed a clear conflict between two earlier decisions of co-ordinate Benches. Jyotsana denied the existence of any restorative power in State Commissions, whereas New India Assurance recognised such an inherent power without addressing the earlier ruling. Additionally, Parliament’s 2003 amendment introduced Section 22-A, expressly empowering only the National Commission to restore matters, thereby raising a question as to legislative intent regarding State Commissions.
Because of these competing authorities and the statutory amendment, the Court concluded that a definitive resolution by a larger Bench is necessary to determine whether State Commissions possess the power to recall or restore complaints dismissed for default.
Holding and Implications
ORDER: The matter is referred to a larger Bench.
Immediate Effect: No final adjudication on the merits; the records are to be placed before the Chief Justice of India for constitution of an appropriate larger Bench.
Broader Implications: The decision recognises a conflict in precedent and suspends resolution of the question until a larger Bench settles the scope of State Commissions’ powers under the Consumer Protection Act, 1986. No new precedent is set until that determination is made.
Dr. Arijit Pasayat, J.— Leave granted.
2. Challenge in this appeal is to the order passed by the National Consumer Disputes Redressal Commission, New Delhi (in short “the National Commission”) holding that the State Commission has the power to restore the complaint which was dismissed for default. For coming to the aforesaid conclusion the National Commission relied upon the decision of this Court in New India Assurance Co. Ltd. v. R. Srinivasan (2000) 3 SCC 242.
3. Learned counsel for the appellant submitted that the view contrary to what has been stated in New India Assurance case (2000) 3 SCC 242 has been taken in Jyotsana Arvindkumar Shah v. Bombay Hospital Trust (1999) 4 SCC 325. Further, the Consumer Protection Act, 1986 (in short “the Act”) was amended in 2003 and by the newly introduced Section 22-A, the National Commission was given power of restoration but no such power has been conferred on the State Commission.
4. Learned counsel for the respondents on the other hand submitted that the National Commission has referred the case to the factual position and, therefore, held that restoration was permissible.
5. In Jyotsana case (1999) 4 SCC 325 it was observed at para 7 as follows:
“7. We heard learned counsel on both sides for quite some time. When we asked the learned counsel appearing for the respondent to point out the provision in the Act which enables the State Commission to set aside the reasoned order passed, though ex parte, he could not lay his hands on any of the provisions in the Act. As a matter of fact, before the State Commission the appellants brought to its notice the two orders, one passed by the Bihar State Commission in CM, UCO Bank v. Ram Govind Agarwal and the other passed by the National Commission in Director, Forest Research Institute v. Sunshine Enterprises holding that the redressal agencies have no power to recall or review their ex parte order. The State Commission had distinguished the abovesaid orders on the ground that in those two cases the opponents had not only not appeared but also failed to put in their written statements. In other words, in the case on hand, according to the State Commission, the opponent (respondent) having filed the written statements, the failure to consider the same by the State Commission before passing the order would be a valid ground for setting aside the ex parte order. The State Commission, however, fell into an error in not bearing in mind that the Act under which it is functioning has not provided it with any jurisdiction to set aside the ex parte reasoned order. It is also seen from the order of the State Commission that it was influenced by the concluding portion of the judgment of the Bombay High Court to the effect that the respondent (writ petitioner) could approach the appellate authority or make an appropriate application before the State Commission for setting aside the ex parte order, if permissible under the law. Here again, the State Commission failed to appreciate that the observation of the High Court would help the respondent, if permissible under the law. If the law does not permit the respondent to move the application for setting aside the ex parte order, which appears to be the position, the order of the State Commission setting aside the ex parte order cannot be sustained. As stated earlier, there is no dispute that there is no provision in the Act enabling the State Commission to set aside an ex parte order.”
(emphasis in original)
6. Subsequently, in New India Assurance case (2000) 3 SCC 242 this Court appears to have taken a different view as it is evident from what has been stated in para 18, the same reads as follows:
“18. We only intend to invoke the spirit of the principle behind the above dictum in support of our view that every court or judicial body or authority, which has a duty to decide a lis between two parties, inherently possesses the power to dismiss a case in default. Where a case is called up for hearing and the party is not present, the court or the judicial or quasi-judicial body is under no obligation to keep the matter pending before it or to pursue the matter on behalf of the complainant who had instituted the proceedings. That is not the function of the court or, for that matter of a judicial or quasi-judicial body. In the absence of the complainant, therefore, the court will be well within its jurisdiction to dismiss the complaint for non-prosecution. So also, it would have the inherent power and jurisdiction to restore the complaint on good cause being shown for the non-appearance of the complainant.”
7. In the latter case i.e New India Assurance case (2000) 3 SCC 242 reference was not made to the earlier decision in Jyotsana case (1999) 4 SCC 325. Further the effect of the amendment to the Act in 2003 whereby Section 22-A was introduced has the effect of conferment of power of restoration on the National Commission, but not to the State Commission. In view of the divergence of views expressed by coordinate Benches, we refer the matter to a larger Bench to consider the question whether the State Commission has the power to recall the ex parte order. Records be placed before the Hon'ble Chief Justice of India for appropriate orders.
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