Case: Paramount Digital Color Lab and Ors Vs. Agfa India Pvt. Ltd. and Ors

handle the machine, is a question of fact and necessity? Ultimately, if it is purely for a "commercial purpose" and not for "self-employment", the complainant may not get the benefit of the Explanation to Section 2(1)(d) of the Act. The buyers of the goods or commodities for "self-consumption" in economic activities in which they are engaged would be "consumers" as defined in the Act. Furthermore, there is nothing on record to show that the Appellants wanted to use the machine in question for purposes other than "self-employment". Therefore, the point to be considered is whether the Appellants have purchased the machine in question for "commercial purpose" or exclusively for the purposes of earning their livelihood by means of "self-employment". There cannot be any dispute that the initial burden is on the Appellants to prove that they fall within the definition of "consumer". It is pertinent to mention that Respondent No. 4, who is a contesting party, did not choose to file a counter affidavit before the State Commission. In other words, he did not deny any of the claims made by the Appellants. None of the parties have led their evidence. Based on the material on record before the State Commission, it proceeded to decide on merits. As the litigation is being fought since 2006 in different Forums, we do not wish to remand the matter, particularly, when there is sufficient material available on record for arriving at the conclusion. 14. The word "purchaser" means and includes members of his family also. The machine in question was purchased by two partners; both were unemployed graduates. They started a firm namely M/s. Paramount Digital Color Lab at Varanasi, U.P. afresh. The Appellants have specified that they are unemployed graduates; they planned to start a business of photography for self-employment and for their livelihood, for which they contacted Respondent Nos. 2 & 4, which means that they had not planned to start their business of photography till they planned to purchase the machine in question. Having felt the need of the machine in question, they contacted Respondent No. 1 and enquired about the salient features and performance of the "Agfa Minilab D-Lab. 1 All rounder" machine. Being impressed by the advice and suggestion made by Respondent Nos. 2 & 4, Appellants borrowed a loan from the Union Bank of India on 12.07.2004 and placed an order for the purchase of the said machine and paid by draft an amount of Rs. 62,00,000/- towards the cost of the machine along with freight and collateral charges. It is the case of the Appellants that they purchased the machine with the fond hope and belief that it would give good results and that they would earn a handsome amount by which their basic needs of livelihood would be fulfilled and that the family of the Appellants will survive smoothly. They might have started the business with the help of one operator and helper. Of course, in Paragraph 14 of the complaint, the Appellants have used the words "Operators and Helpers". This portion of the complaint has been highlighted by the National Commission to conclude that the Appellants were using the machine with the help of third parties for commercial purposes inasmuch as they themselves were not using the machine personally. Such averment by the Appellants in the complaint appears to be an exaggerated version with a view to get more compensation. One such stray sentence will not tilt the balance against the Appellants. The material needs to be seen in its entirety and not in isolation. Since there is nothing on record to show that they wanted the machine to be installed for a commercial purpose and not exclusively for the purposes of earning their livelihood by means of self-employment, the National Commission was not justified in concluding that the Appellants have utilised the services of an operator or a helper to run a commercial venture. One machine does not need many operators or helpers to complete the work entrusted. Since the Appellants were two partners, they must have been doing the work on their own, of course, may be with the aid of a helper or an operator. The machine would not have been used in a large-scale profit-making activity but, on the contrary, the Appellants purchased the machine for their own utility, personal handling and for their small venture which they had embarked upon to make a livelihood. The same is distinct from large-scale manufacturing or processing activity carried on for huge profits. There is no close nexus between the transaction of purchase of the machine and the alleged large-scale activity carried on for earning profit. Since the Appellants had got no employment and they were unemployed graduates, that too without finances, it is but natural for them to raise a loan to start the business of photography on a small scale for earning their livelihood. 15. The material discloses that Respondent No. 1 company was dissolved in the year 2005. Prior to this dissolution, Respondent No. 2 was the Managing Director of Respondent No. 1 and Respondent No. 4 was the General Manager of Respondent No. 1. The Respondent Nos. 2 and 4 collectively talked with the Appellants and finalised the agreement along with the assurance that the machine is up to the marked standard and that repairs, if any, would be rectified free of cost, apart from other things assured. Respondent No. 3 is the subsequent company which has taken over from Respondent No. 1 in the year 2005. The said company also did not come to the aid of the Appellants either by replacing the machine or by rectifying the major defects, consequent upon which the Appellants have suffered huge losses. Anybody can visualise the loss sustained by the Appellants inasmuch as they had obtained a loan with the promise to pay interest to Respondent No. 5 bank for purchasing the machine. Therefore, Respondent Nos. 2, 3 and 4 are collectively liable to make good the loss of the Appellants.

Decision (1 = appeal accepted, 0 = rejected): 1

Explanation:
1[ds]9. Heard learned Counsel for the Appellants and perused the records. It is relevant to note that no relief has been claimed as against Respondent No. 5. Having gone through the judgment of the National Commission, it is clear that though a number of points arose for consideration, it did not choose to decide the same for remanding the matter, since it felt that the complaint itself was not maintainable and that the matter has been pending for long. The State Commission not only held that the complaint was maintainable, but also proceeded on merits and held in favour of the Appellants10. The National Commission on evaluation of the material on record and after hearing the parties concluded that the complainants are not "consumers" as envisaged Under Section 2(1)(d) of the Consumer Protection Act and hence the Act is not applicableIf both these provisions are read together, it leads to the conclusion that if a person purchased the goods for consideration not for any commercial purpose, but exclusively for the purposes of earning his livelihood by means of "self-employment", such purchaser will come within the definition of "consumer". If a person purchases the goods for a "commercial purpose" and not for the purposes of earning his livelihood by means of "self-employment", such purchaser will not come within the definition of "consumer". It is therefore clear, that despite "commercial activity", whether a person would fall within the definition of "consumer" or not would be a question of fact in every case. Such question of fact ought to be decided in the facts and circumstances of each caseIn the matter on hand, the quality of ultimate production by the user of the machine would depend upon the skill of the person who uses the machine. In case of exigencies, if a person trains another person to operate the machine so as to produce the final product based on skill and effort in the matter of photography and development, the same cannot take such person out of the definition of "consumer"13. Thus, in our considered opinion, each case ought to be judged based on the peculiar facts and circumstance of that caseUltimately, if it is purely for a "commercial purpose" and not for "self-employment", the complainant may not get the benefit of the Explanation to Section 2(1)(d) of the Act. The buyers of the goods or commodities for "self-consumption" in economic activities in which they are engaged would be "consumers" as defined in the Act. Furthermore, there is nothing on record to show that the Appellants wanted to use the machine in question for purposes other than "self-employment"There cannot be any dispute that the initial burden is on the Appellants to prove that they fall within the definition of "consumer". It is pertinent to mention that Respondent No. 4, who is a contesting party, did not choose to file a counter affidavit before the State Commission. In other words, he did not deny any of the claims made by the Appellants. None of the parties have led their evidence. Based on the material on record before the State Commission, it proceeded to decide on merits. As the litigation is being fought since 2006 in different Forums, we do not wish to remand the matter, particularly, when there is sufficient material available on record for arriving at the conclusion14. The word "purchaser" means and includes members of his family also. The machine in question was purchased by two partners; both were unemployed graduates. They started a firm namely M/s. Paramount Digital Color Lab at Varanasi, U.P. afresh. The Appellants have specified that they are unemployed graduates; they planned to start a business of photography for self-employment and for their livelihood, for which they contacted Respondent Nos. 2 & 4, which means that they had not planned to start their business of photography till they planned to purchase the machine in question. Having felt the need of the machine in question, they contacted Respondent No. 1 and enquired about the salient features and performance of the "Agfa Minilab D-Lab. 1 All rounder" machine. Being impressed by the advice and suggestion made by Respondent Nos. 2 & 4, Appellants borrowed a loan from the Union Bank of India on 12.07.2004 and placed an order for the purchase of the said machine and paid by draft an amount of Rs. 62,00,000/- towards the cost of the machine along with freight and collateral charges. It is the case of the Appellants that they purchased the machine with the fond hope and belief that it would give good results and that they would earn a handsome amount by which their basic needs of livelihood would be fulfilled and that the family of the Appellants will survive smoothly. They might have started the business with the help of one operator and helper. Of course, in Paragraph 14 of the complaint, the Appellants have used the words "Operators and Helpers". This portion of the complaint has been highlighted by the National Commission to conclude that the Appellants were using the machine with the help of third parties for commercial purposes inasmuch as they themselves were not using the machine personally. Such averment by the Appellants in the complaint appears to be an exaggerated version with a view to get more compensation. One such stray sentence will not tilt the balance against the Appellants. The material needs to be seen in its entirety and not in isolation. Since there is nothing on record to show that they wanted the machine to be installed for a commercial purpose and not exclusively for the purposes of earning their livelihood by means of self-employment, the National Commission was not justified in concluding that the Appellants have utilised the services of an operator or a helper to run a commercial venture. One machine does not need many operators or helpers to complete the work entrusted. Since the Appellants were two partners, they must have been doing the work on their own, of course, may be with the aid of a helper or an operator. The machine would not have been used in a large-scale profit-making activity but, on the contrary, the Appellants purchased the machine for their own utility, personal handling and for their small venture which they had embarked upon to make a livelihood. The same is distinct from large-scale manufacturing or processing activity carried on for huge profits. There is no close nexus between the transaction of purchase of the machine and the alleged large-scale activity carried on for earning profit. Since the Appellants had got no employment and they were unemployed graduates, that too without finances, it is but natural for them to raise a loan to start the business of photography on a small scale for earning their livelihood15. The material discloses that Respondent No. 1 company was dissolved in the year 2005. Prior to this dissolution, Respondent No. 2 was the Managing Director of Respondent No. 1 and Respondent No. 4 was the General Manager of Respondent No. 1. The Respondent Nos. 2 and 4 collectively talked with the Appellants and finalised the agreement along with the assurance that the machine is up to the marked standard and that repairs, if any, would be rectified free of cost, apart from other things assured. Respondent No. 3 is the subsequent company which has taken over from Respondent No. 1 in the year 2005. The said company also did not come to the aid of the Appellants either by replacing the machine or by rectifying the major defects, consequent upon which the Appellants have suffered huge losses. Anybody can visualise the loss sustained by the Appellants inasmuch as they had obtained a loan with the promise to pay interest to Respondent No. 5 bank for purchasing the machine. Therefore, Respondent Nos. 2, 3 and 4 are collectively liable to make good the loss of the Appellants.