The Secretary, Moc, New Delhi-1 . v. M/S Vinod and Company

Court

Supreme Court of India

Decided

11 July 2019

Case no.

C.A. No.-005399-005399 - 2019

Bench

The Chief Justice, M.R. Shah

Author

The Chief Justice

Facts

The respondent, M/s Vinod and Company, engaged in exports from 1988 to 1993 and applied for an REP license valued at Rs 6,16,116, which entitled them to a 20% premium. However, due to the discontinuation of the REP license scheme, the premium of Rs 1,23,223 was not paid. The Additional Chief Controller of Imports and Exports issued an order in September 1991 that held the premium in abeyance until March 1993. After unsuccessful attempts to claim the premium, the respondent approached the District Consumer Disputes Redressal Forum in Delhi, which ruled in their favor, ordering the payment of the premium along with compensation for mental agony and legal expenses. The appellants (the government) were set down ex-parte, and their appeals to higher consumer fora were rejected.

Arguments

Petitioner Arguments

The appellants argued that

• The Exim policy is part of the Union government's fiscal policy and regulatory control over foreign trade.
• The policy's purpose is to encourage exports and regulate imports, and the benefits provided do not constitute a service under the Consumer Protection Act.
• They cited precedents, including
  and
  , to support their position.

The court addressed these arguments by emphasizing that the benefits provided under the Exim policy do indeed constitute a service, thus falling within the jurisdiction of consumer fora.

Respondent Arguments

The respondent contended that

• As an exporter, they were entitled to the premium associated with the REP licenses, which constitutes a benefit provided by the government.
• This benefit is part of the services rendered by the government, making them a consumer under the Act.

The court found merit in the respondent's arguments, affirming that the government’s actions in providing the premium were indeed services rendered to the respondent.

Precedents considered

The court referenced the decisions in
and
. These cases were used to argue that the government’s actions did not constitute a service. However, the court distinguished these precedents by asserting that the specific context of the Exim policy and the REP license involved a direct benefit to the exporter, qualifying as a service under the Consumer Protection Act.

Legal principles

The court considered the definition of "consumer" under Section 2(1)(d) of the Consumer Protection Act, 1986, which includes any person who buys goods or hires services for consideration. The court also examined the nature of services rendered by the government in the context of the Exim policy, concluding that the provision of benefits under this policy qualifies as a service.

Decision and reasoning

Rationale

The court reasoned that the government’s provision of the premium under the Exim policy is a service rendered to exporters, thus making them consumers under the Act. The court criticized the appellants' narrow interpretation of "service" and emphasized the broader implications of consumer rights in the context of government policies.

Outcome

The Supreme Court upheld the decisions of the lower consumer fora, confirming that the respondent is a consumer and entitled to the claimed premium. The court ordered the appellants to pay the amount along with compensation. Specific instructions regarding the appeal process were not detailed in the provided text.

Conclusion

This judgment reinforces the interpretation of consumer rights in the context of government services, expanding the scope of the Consumer Protection Act to include benefits provided under government policies. It highlights the importance of recognizing exporters as consumers, thereby ensuring their rights are protected under consumer law.

Read the full judgment on the Supreme Court website (PDF)