MR PREM NARAIN, PRESIDING MEMBER This present appeal has been filed against the judgment dated 30 May 2018 of the Westth Bengal State Consumer Disputes Redressal Commission, Kolkata (the State Commission) in Complaint Case no. 952 of 2017. The brief facts of the case are that the complainant purchased a car BMW 7 Series from the2. appellant/ Opposite party on 02.02.2012 for a sum of Rs.68,26,529/- bearing registration no.WB 06J/4999, with a warranty of two years. During the warranty period the car was functioning normally. On 15.09.2016 the complainant brought the car to the service centre of the opposite party for regular servicing. The technicians found out certain defects in gear box of the car. The complainant left the said car with the service centre of the opposite party. The opposite party gave a service quote for R.10,20,813/-. It was claimed by the complainant that the defect was a manufacturing defect, therefore, he was not required to make any payment to the opposite parties. Later on another quote of Rs.7,61,138/- was sent after giving a discount of Rs.2,59,695/-. This communication was done via e-mail on 18.10.2016. After receiving the objection from the complainant, the opposite party again sent an e-mail dated 29.03.2017 and confirmed that they would bear the cost of transmission assembly replacement of Rs.5,52,564/- only and rest of the amount should be paid by the complainant. It is alleged by the complainant that the opposite party started avoiding the complainant and after several follow-ups the opposite party informed that they could only provide the service if the complainant pays for the service amounting to Rs.10,20,813/- after deducting cost of Rs.5,52,564/- which according to the complainant was an abnormal price. The complainant alleged that the car in question was lying in the service centre of the opposite party for approximately 126 days. Thereafter the complainant preferred a consumer complaint against the opposite party. The State Commission vide its impugned order dated 30.05.2018 allowed the complaint and3. passed the following order: The opposite parties are jointly and severally directed to take back the present vehicle of the complainant and to replace the same with a new vehicle of same model and make, i.e, BMW 740 LI Sedan (Color Imperial Blue Metallic) within 45 days from the date; The opposite parties are jointly and severally directed to pay compensation ofRs.5,00,000/- to the complainant within 30 days from the date otherwise the amount shall carry interest @ 8% per annum from the date till its realisation; The opposite parties are jointly and severally directed to pay Rs.10,000/- as cost of litigation to the complainant within 30 days from the date otherwise the amount shall carry interest @ 8% per annum from the date till its realisation. Hence the present appeal.4. Heard the learned counsel for the parties and perused the record. Learned counsel for the5. appellant stated that the vehicle was purchased on 02.02.2012 and the warranty of the vehicle was for two years and thus warranty expired in February 2014. After the expiry of further two years, in the year 2016, for the first time, the complainant alleges some defects in the car and the vehicle was brought to the dealer/ appellant on 15.09.2016. The vehicle was examined and it was found that there was some defect in the gear box of the car and the same was informed to the complainant and an estimate/ service quote was given for Rs.10,20,813/- on 26.09.2016. Later on, as a good will gesture, the appellant gave some rebate and invoice/ service quote was given for Rs.7.61,138/-. However, the complainant did not pay any amount and filed the present consumer complaint before the State Commission being Complaint Case no. 952 of 2017 on 21.12.2017 alleging manufacturing defect in the car. It was argued by the learned counsel for the appellant that once the warranty period was over, the repair of the car could be done on cost basis only. The State Commission has wrongly passed the order of replacement of the car which has become six years old at the time of passing of the order. In the complaint, the complainant has given date of purchase of the car as 02.02.2012 and then he has given the incident of bringing the car to the appellant on 15.09.2016. He has not given any account of the vehicle during this period as to whether any defect was ever brought to the notice of the appellant from the date of purchase till 15.09.2016, though there were many services in between when the vehicle was brought to the appellant. The complainant has not filed any job cards in support of his claim. If no complaint is seen in the car for about four years, how can the car be stated to have manufacturing defect. The State Commission has relied on an e-mail sent by the appellant dated 18.10.2016 which reads as under: Reference is made to our telephonic conversation on date, regarding the gear not engaging properly in your BMW bearing registration no WB 06J 4999. As already informed to you the transmission is internally faulty as found out by the carried out .diagnosis It was communicated to the complainant that the transmission was internally faulty as found6. out by the diagnosis which required replacement. The State Commission has taken this e-mail as admission of the fact that the transmission system was faulty due to manufacturing defect. The fact is that the vehicle had run for four years and there can be wear and tear in various parts of the vehicle and the same cannot be treated as manufacturing defect. The word internally has been wrongly interpreted by the State Commission to mean defect from the very beginning and an inherent defect whereas the normal meaning should have been assigned to this word to mean that inside there was defect in the gear box. It is further pointed out by the learned counsel that the responsibility to prove the7. manufacturing defect rests with the complainant. Moreover, an expert report is a must for proving any manufacturing defect. In the present case, no expert report has been submitted by the complainant and therefore, he has not been able to fulfil the requirement of proving manufacturing defect in the car. The State Commission has not examined this aspect at all. In support of his argument, the learned counsel for the appellant has mentioned the following judgments: Sushil Automobiles Pvt. Ltd., through its Manager Shri Kamlesh Kumar Singh vs Dr Birendra Narain Prasad and Ors. (Manu/CF/0076/2010); Maruti Udyog Ltd., vs Susheel Kumar Gabgotra and Anr. (Manu/SC/1519/2016); C N Anantharam vs Fiat India Ltd., and Ors. (Manu/SC/0970/2010); Lally Motors Ltd., vs M J S Virk and Ors. (Manu/CF/0326/2016); Classic Automobiles vs Lila Nand Mishra and Ors. (Manu/CF/0086/2009); Toyota Kirloskar Motors P Ltd., and Ors., vs Tirath Singh Oberoi (Manu/CF/0727/2016) The learned counsel for the appellant has further argued that the appellant is only the dealer8. and not the manufacturer. The manufacturer has not been made a party in the complaint case. Once a manufacturing defect was alleged in the complaint, it was incumbent upon the complainant to have made the manufacturer as a party. The learned counsel for the appellant has further argued that even if the vehicle had been9. under warranty and defect in the transmission assembly/ gear box was noticed or even treated as manufacturing defect, the replacement of defective part is only provided under warranty and replacement of the whole car is not allowed rather only the defective part of the car can be replaced. In support of his assertion the learned counsel for the appellant has relied upon the judgement of this Commission in RP no. 2854 of 2014 titled Hyundai Motor India Limited vs Decided on 14.08.2014. Surbhi Gupta and Ors. On the other hand the learned counsel for the respondent/ complainant states that unfair10. trade practice on the part of the appellant is clear from the very fact that the appellant has submitted three service quotes for the same job/ defects. The first was submitted on 26.09.2016 for Rs.10,20,813/-, the second was submitted on 18.10.2016 for Rs.7,61,138/- and the third was submitted on 29.03.2017 which was the original amount minus Rs.5.52 lakh. The argument of the learned counsel for the appellant cannot be accepted that the appellant gave discount as a good will gesture. The appellant is a commercial firm and there is no question of any rebate on good will gesture. Clearly the quote was given which was highly inflated and the same was reduced twice to the extent that the final quote was less than 50% of the original quote. In the last quote, the appellant has agreed to bear the total cost for replacement of transmission assembly/ gear box. This clearly shows that internally the appellant was satisfied that there was some manufacturing defect in the transmission on assembly/ gear box. . It was further submitted by the learned counsel for the respondent that there was no need for11 any expert report when the appellant has itself agreed after diagnostic inspection of the car that the transmission assembly/ gear box was internally faulty and required replacement. As the vehicle could not be used since 15.09.2016 for 126 days, therefore, the complainant has demanded compensation @ Rs.10,000/- per day. The complainant did not agree to pay any repair charges for the defects in the gear box as the same was a manufacturing defect and the vehicle having manufacturing defect must be replaced by the dealer. The e-mail of the opposite party dated 18.10.2016 clearly states that the transmission was internally faulty and requires replacement. This clearly amounts to admitting that this was a manufacturing defect. Learned counsel for the respondent has further pointed out that in the present case, the12. appellant/ opposite party did not appear before the State Commission on many dates and did not file their written statement in spite of many opportunities having been granted by the State Commission. On the day of final hearing, the counsel for the appellant appeared and argued the case. Even on that date there was no request from the learned counsel for the opposite parties for granting time for filing the written statement. If a party does not file its defence the forum is likely to take its view based on the complaint and other evidence available on the record. Later on the party cannot raise any objection on the order of the forum. It was further stated by the learned counsel that the amount of Rs.4.7 lakh has been spent and paid to the appellant from the date of purchase till 15.09.2016 on different repairs and other charges. Thus the vehicle was giving trouble right from the beginning therefore it was taken to the dealer on many occasions for repairs of different kinds. Clearly, this shows that the vehicle was not perfectly in order and a defective vehicle was supplied to the complainant by the OPs. In support of his argument the learned counsel for the respondent has relied on the following judgments. Special Leave Petition (C) nos. 21178 -21180 of 2009decided on 24.11.2010- C N Anantharam vs Fiat India Ltd and Ors. Revision Petition no. 1030 of 2008 decided on 03.12.2013 Tata Motors vs Rejesh Tyagi and HIM Motors Show Room II RP no. 1445 and 1961 of 2008 decided on 18.09.2013 M/s Mandovi Motors Pvt. Ltd., vs Pravenchandra Shetty and Maruti Udyog Limited and Maruti Suzuki India Limited vs . Pravenchandra Shetty and Mandovi Motors Pvt. Ltd I have carefully considered the arguments advanced by the learned counsel for both the13. parties and examined the material on record. I find force in the contention of the learned counsel for the appellant that after warranty if any component goes wrong, the responsibility for its repair or replacement will be on the car owner. This vehicle has run properly for four years and during this time warranty expired. Had there been any manufacturing defect, the same would have surfaced during these four years. On the other hand, it is true that for such costly vehicle, the internal defect in the gear box should not have developed in the car in its fifth year of its running. However, no norms have been fixed for defects to develop in such cars. It can only be taken that there was defect in the gear box which needed to be repaired or replaced. In totality the complainant has suffered and he had to get his vehicle repaired, whereas in the normal circumstances, the vehicle should have given no trouble for a longer period of time. Moreover, the complainant has suffered mental agony and harassment due to the inflated quotation for the replacement/ repair of the gear box. No only this the quotation were changed two times and during this period, the vehicle remained unusable to the detriment of the complainant. The State Commission has ordered replacement of the vehicle. As the vehicle has already14. run for about four years without any trouble and therefore, no manufacturing defect can be attributed to the vehicle. Thus, without any manufacturing defect in the vehicle, the order for replacement of the vehicle after so many years is not justified, therefore, the order of the State Commission for replacement of the vehicle is liable to be set aside. So far as compensation of Rs.5.00 lakh granted by the State Commission to the complainant is concerned, keeping above factors in view, the same is reduced to Rs.2.5 lakh to be paid by the appellant/ OPs to the respondent/ complainant. Based on the above discussion, the appeal is partly allowed and the order of the State15. Commission in respect of replacement of the vehicle is set aside. Further the order of the State Commission in respect of award of compensation of Rs.5.00 lakh is modified to the extent that the appellant shall pay a sum of Rs.2.5 lakh (rupees two lakh fifty thousand only) as compensation to the respondent/ complainant. This amount will carry interest @ 8% per annum from the date of the order of the State Commission, i.e., 30.05.2018 till its realisation. Litigation cost of Rs.10,000/- is maintained. ...................... PREM NARAIN PRESIDING MEMBER
Structured Summary of the Opinion — Presiding Member Prem Narain
Factual and Procedural Background
This appeal challenges the judgment dated 30 May 2018 of the West Bengal State Consumer Disputes Redressal Commission, Kolkata in Complaint Case No. 952 of 2017.
Key factual matrix (as stated in the opinion):
- Complainant purchased a BMW 7 Series on 02.02.2012 for Rs.68,26,529/-, registration no. WB 06J/4999, with a two-year warranty.
- During the warranty period the car functioned normally. On 15.09.2016 the complainant brought the car to the dealer/appellant's service centre for servicing; technicians found defects in the gearbox and the car was left with the service centre.
- The dealer initially issued a service quote for Rs.10,20,813/- (26.09.2016), later issued a reduced quote for Rs.7,61,138/- by way of a discount (e-mail dated 18.10.2016), and subsequently by an e-mail dated 29.03.2017 confirmed bearing Rs.5,52,564/- for transmission assembly replacement and asked the complainant to pay the balance.
- Complainant alleged a manufacturing defect and refused payment; the vehicle remained in the service centre for approximately 126 days. Complainant filed a consumer complaint on 21.12.2017.
- The State Commission allowed the complaint on 30.05.2018 and directed (i) replacement of the vehicle with a new BMW 740 LI Sedan (same model and color) within 45 days, (ii) payment of Rs.5,00,000/- as compensation within 30 days (with 8% p.a. interest if delayed), and (iii) payment of Rs.10,000/- as litigation cost within 30 days (with 8% p.a. interest if delayed).
- The dealer (appellant) appealed to the forum that issued the present opinion.
Legal Issues Presented
- Whether the defect in the transmission/gearbox constituted a manufacturing defect attributable to the dealer such that replacement of the entire vehicle was justified.
- Whether the dealer could be held liable for a manufacturing defect when the vehicle's warranty had expired (warranty expired in February 2014) and the defect manifested in 2016.
- Whether an expert report was required and produced to prove a manufacturing defect.
- Whether the manufacturer should have been made a party to the complaint if a manufacturing defect was alleged.
- Whether the quantum of compensation awarded by the State Commission (Rs.5,00,000/-) and the order of replacement were justified on the facts.
Arguments of the Parties
Appellant's (Dealer's) Arguments
- Warranty expired in February 2014; the defect was first alleged in 2016, so post-warranty repairs/replacements are at the complainant's cost.
- The vehicle ran for about four years without reported defects; absence of complaints/job cards during that period undermines the claim of a manufacturing defect from the outset.
- The State Commission wrongly interpreted the appellant's e-mail stating the transmission was "internally faulty" as admission of an inherent/manufacturing defect; the term should be read to mean that an internal part required replacement, not that the defect existed from manufacture.
- The complainant bore the responsibility to prove manufacturing defect and failed to produce an expert report; no expert report was filed.
- The appellant is only a dealer, not the manufacturer; the manufacturer was not made a party despite allegations of manufacturing defect.
- Even if the defect fell within warranty coverage, the remedy ordinarily is replacement/repair of the defective part, not replacement of the entire vehicle; replacement of the whole car was inappropriate.
- Appellant cited multiple precedents in support of these submissions (cases listed in the opinion).
Respondent's (Complainant's) Arguments
- The sequence of three service quotes (Rs.10,20,813; Rs.7,61,138; and an adjustment resulting in appellant bearing Rs.5,52,564) demonstrates unfair trade practice and suggests the appellant's own diagnostic acceptance that the transmission assembly/gearbox was internally faulty.
- Because the appellant admitted the transmission was "internally faulty" after diagnostic inspection, there was no need for a separate expert report to prove manufacturing defect.
- The vehicle was unusable for approximately 126 days, and complainant demanded compensation for loss; the inflated and changing quotations caused mental agony and harassment.
- The appellant failed to appear or file a written statement before the State Commission on multiple dates; absence justified an adverse view being taken.
- Complainant pointed to prior expenditures of about Rs.4.7 lakh on repairs since purchase to demonstrate ongoing trouble and to support the claim of a defective vehicle supplied by the appellant.
- The respondent cited authorities in support of these submissions (cases listed in the opinion).
Table of Precedents Cited
Precedent | Rule or Principle Cited For | Application by the Court |
---|---|---|
Sushil Automobiles Pvt. Ltd., through its Manager Shri Kamlesh Kumar Singh vs Dr Birendra Narain Prasad and Ors. (Manu/CF/0076/2010) | Cited by the appellant in support of his submissions (as stated in the opinion). | The opinion records the citation among authorities relied upon by the appellant; the court considered the appellant's arguments but did not explicitly base its ruling solely on this precedent. |
Maruti Udyog Ltd. vs Susheel Kumar Gabgotra and Anr. (Manu/SC/1519/2016) | Cited by the appellant in support of his submissions (as stated in the opinion). | Listed as cited by the appellant; the court did not specifically elaborate upon or apply this case in its reasoning as set out in the opinion. |
C N Anantharam vs Fiat India Ltd. and Ors. (Manu/SC/0970/2010) | Cited by both parties (the opinion records citation by the appellant and also by the respondent in support of submissions). | Recorded in the opinion as cited by parties; the court considered the parties' arguments and the material on record without expressly grounding its decision exclusively on this precedent. |
Lally Motors Ltd. vs M J S Virk and Ors. (Manu/CF/0326/2016) | Cited by the appellant in support of his submissions (as stated in the opinion). | Included in the list of cases cited by the appellant; the opinion does not recount a specific application of this authority to the court's reasoning. |
Classic Automobiles vs Lila Nand Mishra and Ors. (Manu/CF/0086/2009) | Cited by the appellant in support of his submissions (as stated in the opinion). | Appears in the appellant's list of authorities; the court's decision is recorded on the facts and arguments rather than an explicit reliance on this case in the written reasoning. |
Toyota Kirloskar Motors P Ltd., and Ors., vs Tirath Singh Oberoi (Manu/CF/0727/2016) | Cited by the appellant in support of his submissions (as stated in the opinion). | Noted as cited by the appellant; the court did not expressly base its outcome on this specific precedent in the opinion text. |
Tata Motors vs Rejesh Tyagi and HIM Motors Show Room II RP nos. 1445 and 1961 of 2008 (decided on 18.09.2013) | Cited by the respondent in support of his submissions (as stated in the opinion). | Recorded as authority relied upon by the respondent; the court's reasoning as presented addresses the facts and submissions rather than explicitly applying this precedent. |
M/s Mandovi Motors Pvt. Ltd. vs Pravenchandra Shetty; Maruti Udyog Limited and Maruti Suzuki India Limited vs Pravenchandra Shetty and Mandovi Motors Pvt. Ltd. | Cited by the respondent in support of his submissions (as stated in the opinion). | Noted among the respondent's cited authorities; the court's decision is articulated on the factual matrix and submissions and does not identify a discrete reliance on these cases in the reasoning set out. |
Court's Reasoning and Analysis
The court's step-by-step reasoning (as stated in the opinion) is summarized below, strictly reflecting the content of the opinion:
- The court accepted the appellant's contention that the warranty expired in February 2014 and that post-warranty repairs or replacements are generally the responsibility of the vehicle owner.
- The vehicle had run for about four years without reported trouble; the court held that if there had been a manufacturing defect from the time of manufacture, it likely would have manifested during those four years.
- The court acknowledged that development of an internal gearbox defect in the fifth year for a costly vehicle is unfortunate, but noted that no fixed normative timeframe exists for when such defects may develop.
- The word "internally" in the appellant's e-mail was assessed: the court found that the State Commission erred in equating the term with an admission that the defect was present from manufacture; instead, it should be interpreted to mean there was an internal fault identified in the gearbox at that inspection.
- The court observed that the complainant had not produced an expert report; it accepted the appellant's argument that the burden to prove a manufacturing defect lies on the complainant and that an expert report is material to proving such a defect (the opinion notes the appellant's submission on this point).
- Considering the above, the court concluded that the State Commission's order directing replacement of the entire vehicle after about six years of the vehicle's life was not justified and was liable to be set aside.
- However, the court also accepted that the complainant suffered inconvenience, mental agony and harassment due to inflated and changing quotations and that the vehicle remained unusable for a prolonged period (126 days).
- On balance the court modified the relief granted by the State Commission: it set aside the replacement order but reduced the monetary compensation awarded by the State Commission from Rs.5,00,000/- to Rs.2,50,000/-. The court retained the litigation cost of Rs.10,000/-, and ordered interest at 8% per annum on the compensation amount from 30.05.2018 until realization.
Holding and Implications
Core Ruling: The appeal is PARTLY ALLOWED.
Direct effects and specific orders (as set out in the opinion):
- The State Commission's order insofar as it directed replacement of the complainant's vehicle is set aside.
- The State Commission's award of Rs.5,00,000/- as compensation is modified; the appellant/dealer is directed to pay Rs.2,50,000/- as compensation to the complainant. This amount shall carry interest at 8% per annum from 30.05.2018 until realization.
- The litigation cost awarded by the State Commission of Rs.10,000/- is maintained.
Broader implications: The opinion does not purport to lay down a new general rule beyond its application to the facts. It emphasizes that post-warranty defects are generally the vehicle owner's responsibility and that an admission that a component is "internally faulty" does not, without more, establish a manufacturing defect dating to the time of manufacture. The court also affirmed that relief for consumer suffering (compensation) may be appropriate where procedural or commercial conduct (inflated/changing quotations, prolonged unavailability of the vehicle) causes hardship, even where replacement of the vehicle is not warranted.
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