1993 (3) TMI 264 - Commission - Companies Law

Consumer - Meaning of - Complainant purchased shares through opposite party, a broker, and then sold them and handed over share certificates and signed transfer deeds to opposite party for delivery in market - Their sale price was received by cheques which ultimately bounced - Complainant had also purchased certain other shares through him but neither allotment letter nor share certificates were given to him in this regard, with consequence that bonus shares issued by company were denied to the broker - Complainant, therefore, prayed for direction to opposite party to make payment of all moneys due and damages - Whether relationship between complainant, and share broker was the relationship providing service for consideration by charging commission, and, therefore complainant was a consumer within a meaning of section 2(1)(d) - Held, yes - Whether opponent having failed to render services or give account of shares sold by him and his cheques having been dishonoured, complainant had been duped and was thus entitled to damages from opponent - Held, yes

Issues:
1. Opportunity to defend the case not given to the opponent.
2. Whether the complainant is a consumer under the Consumer Protection Act, 1986.
3. Allegations of fraud against the opponent.
4. Appeal filed against the wrong person in one case.

Opportunity to Defend the Case:
The judgment discusses the proceedings of the District Forum in Complaint No. 427 of 1991, where the opponent failed to file a written statement despite multiple adjournments. The opponent did not request cross-examination of the complainant or seek further opportunities to present his case. The District Forum proceeded without the written statement due to the opponent's delays and lack of action, leading to a conclusion that the opponent was given ample opportunities to defend but failed to utilize them. Therefore, the argument that the opponent was not given a fair opportunity was dismissed.

Consumer Status of the Complainant:
The appellant contended that the complainant was not a consumer under the Consumer Protection Act, 1986, as consideration had flown from the complainant to the opponent. However, the judgment rejected this argument, stating that brokers engage in transactions for commission, making the complainant a consumer under the Act. The relationship between the complainant and the opponent involved the provision of services for consideration through commission, establishing the complainant's consumer status.

Fraud Allegations:
The judgment addressed the fraud allegations against the opponent, emphasizing that the complainant had delivered shares and transfer deeds to the opponent, who failed to return the sale price or provide any information regarding the shares. The opponent's cheques were dishonored, indicating a lack of fulfillment of services. The judgment concluded that the complainant was duped, and no fraud was committed by the complainant. The opponent's failure to deliver services or account for the shares sold rendered the opponent liable for damages to the complainant.

Appeal Against the Wrong Person:
In one case, an appeal was filed against the wrong person, as the Consumer Case was filed by Ms. Ramilaben D. Mali, but the appeal was against Hitesh Dineshchandra Mali. The judgment highlighted this discrepancy and concluded that the appeal against the wrong individual was not valid. Therefore, the appeal was dismissed on this ground, in addition to the lack of merit in the other appeals.

In conclusion, the judgment dismissed the appeals, emphasizing that the opponent had sufficient opportunity to defend the case, the complainant qualified as a consumer under the Act, and the opponent was found liable for damages due to failure to fulfill services. Additionally, the appeal filed against the wrong person was dismissed. The costs were quantified at Rs. 500, to be paid by the appellant to the respondent.

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