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TMI Blog2024 (5) TMI 881X X X X Extracts X X X X X X X X Extracts X X X X ..... by the traders and manufacturers of the consumer goods, and to help consumers in getting justice and fair treatment in the matter of goods and services purchased and availed by them in a market dominated by large trading and manufacturing bodies. It is trite to say that a reference to statement of objects and reasons is permissible for understanding the background, the antecedent state of affairs, the surrounding circumstances in relation to the statute, and the evil which the statute had sought to remedy - As discernible from the statement of objects and reasons for re-enacting the CP Act, 2019, there were certain shortcomings found in the CP Act 1986 while administering the said Act, and at the same time, due to the emergence of global supply chains, rise in international trade and rapid development of ecommerce leading to new systems for goods and services, new options and opportunities had become available to the consumers. The very purpose and object of the CP Act 1986 as re-enacted in 2019 was to provide protection to the consumers from the unfair trade practices and unethical business practices only. There is nothing on record to suggest that the Legislature ever intended t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the Advocates Act lay down the restrictions on the Senior Advocates, and also lay down the standards of professional conduct and etiquette, which include the duties of the advocate to the Court, to the client, to the opponent and to the colleagues. Thus, comprehensive provisions are contained in the Advocates Act, 1961 and the Bar Council of India Rules framed thereunder, to take care of the professional misconduct of the Advocates, and prescribing the punishments if they are found guilty of professional or other misconduct by the Disciplinary Committees of the State Bar Council or the Bar Council of India as the case may be. This Court in Dharangadhra Chemical Works Ltd. vs. State of Saurashtra and Others [ 1956 (11) TMI 33 - SUPREME COURT] , recognized this position of law and held that the correct method of approach, therefore, would be to consider whether having regard to the nature of the work there was due control and supervision by the employer . As per PANKAJ MITHAL, J. Whether the legal services of the lawyer availed of by the client would be covered under the Consumer Protection Act, 1986 (now Consumer Protection Act, 2019)? - HELD THAT:- It is well recognized that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r. Jasbir Singh Malik, Adv., Mr. Varun Punia, AOR, Mr. Ashok Kumar Singh, AOR, Mr. Ashok Kumar Singh, Adv., Ms. Pragya Singh, Adv., Mr. Akshay Singh, Adv., Mr. M.S Bhangle, Adv., Mr. Rahul Dubey, Adv., Mr. Sunny Singh, Adv., Mrs. K.Maruthi Rao, Adv., Mrs. K.Radha, Adv., Mrs. Anjani Aiyagari, AOR, Mr. Mohinder Jit Singh, AOR, Mr. Daya Krishan Sharma, AOR, Mr. Rohit Vats, Adv., Mr. Subham Rana, Adv., Mr. Ankit Bhanot, Adv. And Mr. Yashdeep, Adv. Respondent-in-person: Mr. V.K. Singh, Sr. Adv., Mr. Hitesh Kumar Sharma, Adv., Mr. S.K. Rajora, Adv., Mr. Akhileshwar Jha, Adv., Mr. Amit Kumar Chawla, Adv., Mr. Sandeep Singh Dingra, Adv., Ms. Niharika Dewivedi, Adv., Ms. Ritika Raj, Adv., Ms. Manisha Chawla, Adv., Mr. Mahi Pal Singh, Adv., Ms. N. Annapoorani, AOR, Dr. Adish C Aggarwala, Sr. Adv., Mr. Sukumar Pattjoshi, Sr. Adv., Mr. Rohit Pandey, Adv., Mr. Meenesh Kumar Dubey, Adv., Ms. Yugandhara Pawar Jha, Adv., Mr. Amarendra Kumar Singh, Adv., Mr. Arijit Prasad, Sr. Adv., Mr. Jayant Bhushan, Sr. Adv., Mr. Dinesh Kumar Goswami, Sr. Adv., Mr. S Wasim Ahmed Qadri, Sr. Adv., Mr. Pratap Venugopal, Sr. Adv., Mr. Vibhu Shanker Mishra, Adv., Mr. Kumar Gaurav, Adv., Mr. Vikas Gupta, Adv., Mr. Cha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... politan Magistrate, Tis Hazari Court, Delhi, against one Kamal Sharma under Section 138 of the Negotiable Instruments Act, as the cheque for Rs.20,000/- issued by the said Kamal Sharma in favour of the respondent D.K. Gandhi was dishonoured. (ii) During the course of the said complaint case, the accused Mr. Sharma agreed to pay the sum of Rs.20,000/- for the dishonoured cheque besides Rs.5,000/- as the expenses incurred by the complainant. It was alleged by the respondent (complainant) that though the appellant had received from the accused Mr. Sharma the DD/pay order for Rs.20,000/- and the crossed cheque of Rs.5,000/- on behalf of the respondent, the appellant did not deliver the same to the respondent and instead demanded Rs.5,000/- in cash from the respondent. The appellant also filed a suit for recovery of Rs.5,000/- in the court of Small Causes, Delhi raising a plea that the sum was due to him as his fees. Subsequently, the appellant gave the DD/pay order for Rs.20,000/- and cheque for Rs.5,000/- to the respondent, however, the payment of cheque for Rs.5,000/- was stopped by the accused Mr. Sharma at the instance of the appellant. The respondent therefore filed a complaint be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ess of judicial process depends on the independence of the Bar. Hence, its autonomy is needed to preserve the democracy and to keep judiciary strong. (iii) A unique feature which distinguishes an Advocate from other professional is that an Advocate has a duty to the court and his peers, in addition to his duty to the client. He is not mere a mouthpiece but he has to exercise his own judgment for upholding the interest of his client by all fair, legal and reasonable means, and by being respectful to the court. (iv) The Bar Council of India and State Bar Councils are invested with the disciplinary powers. An error of judgment or mere negligence may not be a professional misconduct. In any case, the professional misconduct which subsumes cases of negligence, which is covered by the special law i.e., Advocates Act, 1961. (v) The Advocates Act being special law would prevail over the CP Act so far as the conduct of Advocates are concerned. (vi) The law of negligence recognizes that a professional would be held liable in a civil action for negligence and includes professionals of varied fields who possess special skill in that profession generally. (vii) The legal professionals in United ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mit the freedom of lawyers to act solely in their own interest or according to their preferences. (xiv) Unlike any other profession, where professionals are in control of their surrounding fully, legal profession is the sole profession, where advocates have no control over their environment. The environment they work in is controlled by the presiding Judge. (xv) The Bar Council of India Rules prescribe at least four sets of duty that a lawyer has to oblige, viz., Duty to the Court, Duty to the Client, Duty to Opponent and Duty to Colleagues, in no particular order. These duties are sometimes conflicting in nature, however whenever a conflict arises, the duty to court is considered to be paramount. (xvi) Unlike the medical profession, where scientific standards exist to decide the standard of care, there is no universal standard of care or objective test that exists or can be prescribed as the threshold in the case of legal profession to adjudicate upon the question of abdication of duty to care. (xvii) Distinguishing the decision of this Court in Indian Medical Association vs. V.P. Shantha Others (1995) 6 SCC 651, it was sought to be submitted that there is a fundamental difference ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ons stem from the said question, which deserve consideration. (i) Whether the Legislature ever intended to include the Professions or services rendered by the Professionals within the purview of the CP Act 1986 as re-enacted in 2019? (ii) Whether the Legal Profession is sui generis? (iii) Whether a Service hired or availed of an Advocate could be said to be the service under a contract of personal service so as to exclude it from the definition of Service contained in Section 2 (42) of the CP Act 2019? 8. For adverting to the first question, whether the Legislature ever intended to include the Professions or the services rendered by the Professionals within the purview of the CP Act 1986 as re-enacted in 2019, it would be germane to ascertain the legislative intention and to look back to the history, object and purpose of enacting the CP Act 1986. A three-Judge Bench in case of State of Karnataka vs. Vishwabharathi House Building Coop. Society and Others (2003) 2 SCC 412 , while dealing with the issue raised about the constitutional validity of the CP Act 1986, had elaborately considered the history, objects and purpose of enacting the said Act. 5. Before adverting to the question ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he Act. 10. It further seeks inter alia to promote and protect the rights of consumers such as (a) The right to be protected against marketing of goods which are hazardous to life and property; (b) the right to be informed about the quality, quantity, potency, purity, standard and price of goods to protect the consumer against unfair trade practices; (c) the right to be assured, wherever possible, access to variety of goods at competitive prices; (d) the right to be heard and to be assured that consumers' interests will receive due consideration at appropriate forums; (e) the right to seek redressal against unfair trade practice or unscrupulous exploitation of consumers; and (f) right to consumer education. 9. The scope and object of the said legislation had also come up for consideration before this Court in Common Cause, A Registered Society vs. Union of India and Others (1997) 10 SCC 729 in which it was observed: - 2. The object of the legislation, as the Preamble of the Act proclaims, is for better protection of the interests of consumers . During the last few years preceding the enactment there was in this country a marked awareness among the consumers of goods that they w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as held in paragraph 10 as under: - 10. A review of the provisions of the Act discloses that the quasi-judicial bodies/authorities/agencies created by the Act known as District Forums, State Commissions and the National Commission are not courts though invested with some of the powers of a civil court. They are quasi-judicial tribunals brought into existence to render inexpensive and speedy remedies to consumers. It is equally clear that these forums/commissions were not supposed to supplant but supplement the existing judicial system. The idea was to provide an additional forum providing inexpensive and speedy resolution of disputes arising between consumers and suppliers of goods and services. The forum so created is uninhibited by the requirement of court fee or the formal procedures of a court. Any consumer can go and file a complaint. Complaint need not necessarily be filed by the complainant himself; any recognized consumers' association can espouse his cause. Where a large number of consumers have a similar complaint, one or more can file a complaint on behalf of all. Even the Central Government and State Governments can act on his/their behalf. The idea was to help the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ew forms of unfair trade and unethical business practices. Misleading advertisements, telemarketing, multi-level marketing, direct selling and ecommerce pose new challenges to consumer protection and will require appropriate and swift executive interventions to prevent consumer detriment. Therefore, it has become inevitable to amend the Act to address the myriad and constantly emerging vulnerabilities of the consumers. In view of this, it is proposed to repeal and re-enact the Act. 14. It is trite to say that a reference to statement of objects and reasons is permissible for understanding the background, the antecedent state of affairs, the surrounding circumstances in relation to the statute, and the evil which the statute had sought to remedy., State of West Bengal vs. Subodh Gopal Bose Others; AIR 1954 SC 92 As discernible from the statement of objects and reasons for re-enacting the CP Act, 2019, there were certain shortcomings found in the CP Act 1986 while administering the said Act, and at the same time, due to the emergence of global supply chains, rise in international trade and rapid development of ecommerce leading to new systems for goods and services, new options and o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e achieved in every case and very often success or failure depends upon factors beyond the professional man's control. In devising a rational approach to professional liability which must provide proper protection to the consumer while allowing for the factors mentioned above, the approach of the courts is to require that professional men should possess a certain minimum degree of competence and that they should exercise reasonable care in the discharge of their duties. In general, a professional man owes to his client a duty in tort as well as in contract to exercise reasonable care in giving advice or performing services. 18. In view of the above, a Profession would require advanced education and training in some branch of learning or science. The nature of work is also skilled and specialised one, substantial part of which would be mental rather than manual. Therefore, having regard to the nature of work of a professional, which requires high level of education, training and proficiency and which involves skilled and specialized kind of mental work, operating in the specialized spheres, where achieving success would depend upon many other factors beyond a man s control, a Pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ued or from being held liable for his professional or otherwise misconduct or other misdeeds causing legal, monetary or other injuries to his clients or the persons hiring or availing his services. The fact that professionals are governed by their respective Councils like Bar Councils or Medical Councils also would not absolve them from their civil or criminal liability arising out of their professional misconduct or negligence. Nonetheless, as discussed hereinabove, we are of the opinion that neither the Professions nor the Professionals were ever intended to be brought within the purview of the CP Act either of 1986 or 2019. 21. Of course, we are conscious of the decision in Indian Medical Association vs. V.P. Shantha Others (supra), in which a three-Judge Bench of this Court has held inter alia that the wide amplitude of the definition of service in the main part of Section 2(1)(o) would cover the services rendered by Medical Practitioners within the said Section 2(1)(o). However, in our humble opinion, the said decision deserves to be revisited having regard to the history, object, purpose and the scheme of the CP Act and in view of the opinion expressed by us hereinabove to th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... shed by our culture, languages and traditions; fostered and sharpened by our genius and quest for social justice; reinforced by history and heritage. After the attainment of independence and the adoption of the Constitution of India, judicial administration and the constitution of the law courts remained fundamentally unchanged. The concept, structure and organisation of courts, the substantive and procedural laws, the adversarial system of trial and other proceedings and the function of judges and lawyers remained basically unaltered and rooted in the common law traditions in contradistinction to those prevailing in the civil law or other systems of law. Resultantly, the role, status and capacity of an advocate to represent his client has also remained by and large unaltered. 27. This Court in R. Muthukrishnan vs. Registrar General, High Court of Judicature at Madras (2019) 16 SCC 407 , delineating the unique nature of the legal profession and of the services rendered by the lawyers, observed thus: 16. The legal profession cannot be equated with any other traditional professions. It is not commercial in nature and is a noble one considering the nature of duties to be performed and ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is intolerable in the judiciary. 20. The Bar is an integral part of the judicial administration. In order to ensure that judiciary remains an effective tool, it is absolutely necessary that the Bar and the Bench maintain dignity and decorum of each other. The mutual reverence is absolutely necessary. The Judges are to be respected by the Bar, they have in turn equally to respect the Bar, observance of mutual dignity, decorum of both is necessary and above all they have to maintain self-respect too. 21. It is the joint responsibility of the Bar and the Bench to ensure that equal justice is imparted to all and that nobody is deprived of justice due to economic reasons or social backwardness. The judgment rendered by a Judge is based upon the dint of hard work and quality of the arguments that are advanced before him by the lawyers. There is no room for arrogance either for a lawyer or for a Judge. 22. There is a fine balance between the Bar and the Bench that has to be maintained as the independence of the Judges and judiciary is supreme. The independence of the Bar is on equal footing, it cannot be ignored and compromised and if lawyers have the fear of the judiciary or from elsewh ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , affects not only an individual but the entire administration of justice, which is the foundation of the civilized society. It must be remembered that the legal profession is a solemn and serious profession. It has always been held in very high esteem because of the stellar role played by the stalwarts in the profession to strengthen the judicial system in the country. Their services in making the judicial system efficient, effective and credible, and in creating a strong and impartial Judiciary, which is one of the three pillars of the Democracy, could not be compared with the services rendered by other professionals . Therefore, having regard to the role, status and duties of the Advocates as the professionals, we are of the opinion that the legal profession is sui generis i.e unique in nature and cannot be compared with any other profession. 31. The next question that falls for our consideration is whether a service hired or availed of an Advocate could be said to be the service under a contract of personal service? 32. At the outset, it may be stated that in the Indian Courts, various sobriquets or epithets like pleaders, advocates, lawyers, vakils, counsels, attorneys etc. ar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt and to the colleagues. Thus, comprehensive provisions are contained in the Advocates Act, 1961 and the Bar Council of India Rules framed thereunder, to take care of the professional misconduct of the Advocates, and prescribing the punishments if they are found guilty of professional or other misconduct by the Disciplinary Committees of the State Bar Council or the Bar Council of India as the case may be. 35. In the light of the above provisions of the Advocates Act, let us consider some of the provisions of the Consumer Protection Act 1986/2019. The definition of Service contained in Section 2(1)(o) of the CP Act 1986 and in Section 2(42) of the CP Act 2019 is the same which reads as under: - Service means service of any description which is made available to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, telecom, boarding or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re of the work there was due control and supervision by the employer . In the words of Fletcher Moulton, L.J. at P.549 in Simmons v. Heath Laundry Company [(1924) 1 KB 762] which were cited with approval in Dharangadhra Chemcial Works Ltd. (supra): In my opinion it is impossible to lay down any rule of law distinguishing the one from the other. It is a question of fact to be decided by all the circumstances of the case. The greater the amount of direct control exercised over the person rendering the services by the person contracting for them the stronger the grounds for holding it to be a contract of service, and similarly the greater the degree of independence of such control the greater the probability that the services rendered are of the nature of professional services and that the contract is not one of service. 39. What is sought to be opined in the above cases is that the greater the amount of direct control exercised over the person rendering the services by the person contracting for them, the stronger would be the grounds for holding it to be a contract of service. Hence, let us see whether in case of Advocate-Client relationship, the client exercises direct control over ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or pleadings, to file, produce or receive back any documents, to withdraw or compromise the proceedings, to refer to any matter to arbitration, to deposit or withdraw any moneys, to execute any decree or order, to certify payment, and receive any money due under such decree or order. The undersigned should be bound by all whatsoever may be done in the aforesaid case (including any appeal or revision therefrom) for and on behalf of the undersigned by any of the said counsel. Signature Name in full . full . Date . Attesting Witness: Name in Address Date . Accepted/ Accepted on the strength of the signature of the attesting witnesses. 40. A conjoint reading of the provisions contained in Order III CPC and Chapter IV of Advocates Act pertaining to right to practise, there remains no shadow of doubt that an advocate whose name has been entered in the State roll is entitled as of right to practise in all Courts, however he can act for any person in any Court only when he is appointed by such person by executing the document called Vakalatnama. Such Advocate has certain authorities by virtue of such Vakalatnama but at the same time has certain duties too, i.e. the duties to the courts, t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... an officer of the Court, a privileged member of the community, and a gentleman, bearing in mind that what may be lawful and moral for a person who is not a member of the Bar, or for a member of the Bar in his non-professional capacity may still be improper for an advocate. Without prejudice to the generality of the foregoing obligation, an advocate shall fearlessly uphold the interests of his client and in his conduct conform to the rules hereinafter mentioned both in letter and in spirit. The rules hereinafter mentioned contain canons of conduct and etiquette adopted as general guides; yet the specific mention thereof shall not be construed as a denial of the existence of others equally imperative though not specifically mentioned. 24. The Preamble makes it imperative that an advocate has to conduct himself and his duties in an extremely responsible manner. They must bear in mind that what may be appropriate and lawful for a person who is not a member of the Bar, or for a member of the Bar in his non-professional capacity, may be improper for an advocate in his professional capacity. 25. Section II of the said Chapter II provides for duties of an advocate towards his client. Rules ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion that the services hired or availed of an Advocate would be that of a contract of personal service and would therefore stand excluded from the definition of service contained in the section 2(42) of the CP Act, 2019. As a necessary corollary, a complaint alleging deficiency in service against Advocates practising Legal Profession would not be maintainable under the CP Act, 2019. 42. In that view of the matter, we summarize our conclusions as under- (i) The very purpose and object of the CP Act 1986 as re-enacted in 2019 was to provide protection to the consumers from unfair trade practices and unethical business practices, and the Legislature never intended to include either the Professions or the services rendered by the Professionals within the purview of the said Act of 1986/2019. (ii) The Legal Profession is sui generis i.e. unique in nature and cannot be compared with any other Profession. (iii) A service hired or availed of an Advocate is a service under a contract of personal service, and therefore would fall within the exclusionary part of the definition of Service contained in Section 2 (42) of the CP Act 2019. (iv) A complaint alleging deficiency in service against Adv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ces by all enterprises at the national and international levels which adversely affect consumers; e) To facilitate the development of independent consumer groups; f) To further international cooperation in the field of consumer protection; g) To encourage the development of market conditions which provide consumers with greater choice at lower prices; 7. A bare reading of the above guidelines reveals that the same have been formulated taking into account the interests and needs of consumers in various countries, particularly developing countries, in order to level out economic imbalances between consumers and service providers. 8. The General Assembly of the United Nations Organization by Resolution No. 39/248 dated 9.4.1985 provided a framework known as Consumer Protection Resolution to which our country is also a signatory. 9. It is on the basis of the above Consumer Protection Resolution of the UNO that the Consumer Protection Act, 1986 in India was enacted with the objective to save the consumers from unfair conduct and practices of traders. 10. In Om Prakash vs. Assistant Engineer, Haryana Agro Industries Corporation Ltd. and Anr. (1994) 3 SCC 504 a three Judge Bench vide para ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... aws of almost all countries are based upon the same resolution of the UNO which forms the foundation for framing the Consumer Protection Act in India. 14. To illustrate, Consumer Protection Act, 1999 enacted by the Parliament of Malaysia vide Section 2 (2)(e) specifically provides that the said act shall not apply, inter alia, to services provided by professionals who are regulated by any law. It may be worth noting that the services of the professionals such as lawyers in Malaysia are governed by Legal Profession Act, 1976. Therefore, by virtue of the above Section 2 (2) (e), the services provided by the professionals such as lawyers stand excluded from the application of the Consumer Protection Act of Malaysia. 15. This legislative intent of excluding regulated professions from the ambit of Consumer Protection Law has been continuing for over a considerable period of time now. Aspects of such exclusion find mention in the DIRECTIVE 2011/83/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL OF 25 OCTOBER 2011 on consumer rights where it has been said that provisions of the said directive should not apply to regulated professions. 16. At the heart of this legislative intent to exempt ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... other base motives. But the legal principle which underpins the Court's conclusion is fundamental. Of course, there is always a risk that the determination of a legal controversy is imperfect. And it may be imperfect because of what a party's advocate does or does not do. The law aims at providing the best and safest system of determination that is compatible with human fallibility. But underpinning the system is the need for certainty and finality of decision. The immunity of advocates is a necessary consequence of that need . (emphasis supplied) 23. It would be trite to mention here that the legal profession is a regulated profession in India. The Advocates Act, 1961 regulates the conduct of lawyers in India and is a complete code in itself. Given the regulation, India also needs to bring the working of its regulated professions in alignment with international practices. 24. In the era of globalization, though I am conscious that a law has to be applied in context with the prevailing situation of the country, nonetheless, to have a uniform application of any law particularly the one which has been framed on the basis of the common resolution of the UNO, laws must have a u ..... X X X X Extracts X X X X X X X X Extracts X X X X
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