Full Judgment Text
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PETITIONER:
KALPAVRUKSHA CHARITABLE TRUST
Vs.
RESPONDENT:
TOSHNIWAL BROTHERS (BOMBAY)
DATE OF JUDGMENT: 12/10/1999
BENCH:
S.Saghir Ahmad, R.P.Sethi
JUDGMENT:
S. SAGHIR AHMAD, J.
This appeal was disposed of by us by our judgment
dated 12th August, 1999.
Mr. R.N. Keswani, appearing on behalf of the
appellant, has filed the instant Application stating that he
was the only counsel appearing on behalf of the appellant on
12.8.1999, but since he was busy in some other Court when
the matter was taken up by us, he could not come and argue
the appeal. He also stated that the counsel who was deputed
to make a mention that he (Mr. R.N. Keswani) was busy in
some other Court was not entitled to argue the appeal.
The appeal was heard by us in detail and elaborate
arguments were made on behalf of the appellant also, but
having regard to the fact that Mr. Keswani was the only
counsel in the appeal and he has stated that the other
counsel was not entitled to argue the appeal, we have heard
Mr. Keswani as also Mr. S.P.Mithal.
The main reliance on behalf of the appellant has been
placed on the decision of this Court in Laxmi Engineering
Works vs. P.S.G. Industrial Institute (1995) 3 SCC 583 in
support of the contention that the appellant was a
"consumer" within the meaning of the definition set out in
the Consumer Protection Act, 1986. The definition was
considered by us and it was held that since the machinery in
question was installed by the appellant for commercial
purpose, it would not be a "consumer".
It is contended by the counsel for the appellant that
the term "commercial purpose" has been considered by this
Court in the case of Laxmi Engineering Works (supra) and the
observation of National Commission that "commercial purpose"
would mean "profit-making activity on a large scale" was
approved and, therefore, the activity of the present
appellant would not be a commercial activity as no
"profit-making on a large scale" is involved. We do not
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agree. This Court in that decision had further held in para
21 as under :
"21. We must, therefore, hold that :
(i) The explanation added by the Consumer Protection
(Amendment) Act 50 of 1993 (replacing Ordinance 24 of 1993)
with effect from 18.6.1993 is clarificatory in nature and
applies to all pending proceedings.
(ii) Whether the purpose for which a person has bought
goods is a "commercial purpose" within the meaning of the
definition of expression ’consumer’ in Section 2(d) of the
Act is always a question of fact to be decided in the facts
and circumstances of each case.
(iii) A person who buys goods and uses them himself,
exclusively for the purpose of earning his livelihood, by
means of self-employment is within the definition of the
expression ’consumer’."
Applying those tests, the Court in the case of Laxmi
Engineering Works (supra) held that the appellant was not a
‘consumer’ as the machinery in that case were not purchased
for self-employment, but were purchased for "commercial
purposes."
It is, therefore, clear that in spite of the
commercial activity, whether a person would fall within the
definition of "consumer" or not would be a question of fact
in every case. The National Commission had already held on
the basis of the evidence on record that the appellant was
not a "consumer" as the machinery was installed for
"commercial purpose". We have been again referred to
various documents, including the "Project document",
submitted by the appellant itself to the Bank for a loan to
enable it to purchase the machinery in question, but we
could not persuade ourselves to take a different view.
Learned counsel for the appellant then referred to the
case of Addl. Commissioner of Income Tax, Gujarat vs.
Surat Art Silk Cloth Manufacturers Association (1980) 121
ITR 1 wherein the activity of a charitable institution,
though commercial in nature, was held to be a part of the
charitable activity. This decision does not help the
appellant as it was a decision rendered under the Income Tax
Act and the question which we are considering here had not
arisen in that case.
Learned counsel for the appellant then referred to the
decision of this Court in Commissioner of Income Tax, New
Delhi vs. Federation of Indian Chambers of Commerce &
Industries, New Delhi, 1981 (3) SCR 489, and contended that
if the dominant object of the trust or institution is
charitable, the activity carried on by it would not be
treated as an activity for profit. It is contended on the
basis of the above decision that the activities carried on
by the appellant were not profit- oriented nor was there any
intention or object to carry on those activities to earn
profit. This again was the decision rendered under the
Income Tax Act and is not on the point involved in the
present case whether the appellant was a "consumer" within
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the meaning of the Consumer Protection Act, 1986.
In the instant case, what is to be considered is
whether the appellant was a "consumer" within the meaning of
the Consumer Protection Act, 1986, and whether the goods in
question were obtained by him for "re-sale" or for any
"commercial purpose". It is the case of the appellant that
every patient who is referred to the Diagnostic Centre of
the appellant and who takes advantage of the CT Scan etc.
has to pay for it and the service rendered by the appellant
is not free. It is also the case of the appellant that only
ten per cent of the patients are provided free service.
That being so, the "goods" (machinery) which were obtained
by the appellant were being used for "commercial purpose".
No other point was pressed before us. We, therefore,
maintain our judgment dated 12th August, 1999 even after
having heard Mr. Keswani who insisted for a hearing through
this Application. The Application shall be treated as
disposed of.