M/S. National Seeds Corpn. Ltd vs M.Madhusudhan Reddy & Anr

2. Appellant - M/s. National Seeds Corporation Ltd. (NSCL) is a Government of India company. Its main functions are to arrange for production of quality seeds of different varieties in the farms of registered growers and supply the same to the farmers. The respondents own lands in different districts of Andhra Pradesh and are engaged in agriculture/seed production. They filed complaints with the 3 allegation that they had suffered loss due to failure of the crops/less yield because the seeds sold/supplied by the appellant were defective. District Consumer Disputes Redressal Forums, Kurnool, Mehboob Nagar, Guntur, Khamman and Kakinada allowed the complaints and awarded compensation to the respondents. The appeals and the revisions filed by the appellant were dismissed by the Andhra Pradesh State Consumer Disputes Redressal Commission (for short, `the State Commission') and the National Consumer Disputes Redressal Commission respectively.

3. The appellant has questioned the orders of the National Commission, which also implies its challenge to the orders of the State Commission and the District Forums mainly on the following grounds:

5.4 By an order dated 1.12.1999 passed in IA No.141 of 1999, District Forum, Kurnool appointed Shri D. C. Rama Rao, retired Assistant Director of Agriculture as Commissioner and directed him to submit a report after inspecting the field of the respondents. The Commissioner conducted the inspection and submitted report dated 1.12.1999, the relevant portions of which are extracted below -

5.6 The respondents filed their affidavits along with copies of Invoice bill H.No.000691 dated 11.6.1999, No.3 Adangal, letter dated 6.11.1999 given to the appellant, bill dated 29.6.1999 showing the purchase of fertilizers from Chaitanya Chemicals & Fertilizers, Kurnool and the photographs showing the unevenness in the plants. On behalf 11 of the appellant, an affidavit was filed along with copies of the documents mentioned therein.

5.7 The District Forum rejected the appellant's objection to the Commissioner's report and held that the complainants (the respondents herein) have succeeded in proving that the seeds sold to them were defective resulting in loss of crop. Accordingly, the complaint of the respondents was allowed and the appellant was directed to pay Rs.1,00,000/- towards loss of crop and Rs.10,000/- towards the cost of fertilizer, pesticides, labour etc. with a stipulation that if the amount is not paid within one month, the appellant shall be liable to pay interest @ 9% per annum.

On merits, it was pleaded that Shri M. V. Narsimha Rao, Seed Officer of NSC Kurnool had advised the respondent and other growers to remove off-types and diseased plants, which were liable to be rejected but the growers ignored his advice. It was then averred that during their visit on 8.9.2000, Shri M. V. Narsimha Rao, Shri M. V. Sudhakar and Area Manager, NSCL, Kurnool found 7% off-types seeds which were more than the prescribed standards and, therefore, their crops were rejected.

The report of the Horticulture Officer was contested on the premise that the respondent did not get the seeds tested in any government laboratory.

(emphasis supplied) 6.5. The District Forum also opined that the appellant had failed to substantiate its assertion that the respondent had not removed off types and diseased plants despite the advice given by the Seed Officer by observing that no evidence had been produced in that regard. The District Forum finally concluded that the foundation seeds supplied to the 17 respondent were faulty and the appellant was liable to compensate him.

6.6 The State Commission dismissed the appeal filed by the appellant and confirmed the order passed by the District Forum. The National Commission considered the objections raised by the appellant to the maintainability of the complaint, referred to the judgments of this Court in Fair Air Engineers (P) Ltd. v. N.K. Modi (1996) 6 SCC 385, State of Karnataka v.

7.3 By an order dated 27.12.1995, District Forum, Khammam appointed Shri A. Jeevan Babu, Advocate as Commissioner to inspect the field of the respondent and estimate the loss, if any, sustained by him. The Advocate Commissioner requested the Principal, Agriculture College, Aswaraopet and Mandal Revenue Officer, Yerrupalem to depute an expert and an Administrative Officer of Peddagopavaram and Yerrupalem to assist him. The Principal deputed Shri P. Sesha Reddy, Associate Professor and the M.R.O. deputed two executive officers to assist the Advocate 20 Commissioner. Notice of the date of inspection was given to the appellant but no one appeared on its behalf on the appointed day. After conducting inspection with the assistance of Shri P. Sesha Reddy and other officers, the Advocate Commissioner submitted report dated 31.1.1996, the relevant portions of which are extracted below:

(emphasis supplied) 7.4 The District Forum considered the material produced before it including the Commissioner's report, allowed the complaint of the respondent and directed the appellant to pay him Rs.36,200/-. The State Commission and the National Commission approved the conclusion recorded by the District Forum that the respondent had suffered loss because the seeds sold by the appellant were defective. The National Commission dealt with the appellant's plea that the District Forum had not complied with Section 13(1)(c) and that there was violation of the Andhra Pradesh Seeds (Control) Order, 1983 and held:

(ii) in the event of such person having been previously convicted of an offence under this section, with imprisonment for a term which may extend to six months, or with fine which may extend to one thousand rupees, or with both.

316. However, we do not consider it necessary to discuss all the judgments and it will be sufficient to notice some passages from the judgment in Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (supra).

(emphasis supplied) 56

(emphasis supplied)

35.The issue deserves to be considered from another angle.

(emphasis supplied)

40. In the result, the appeals are dismissed. The appellant shall pay cost of Rs.25,000/- to each of the respondents. The amount of cost shall be paid within a period of 60 days from today.