M/S. Paramount Digital Color Lab . vs M/S. Agfa India Pvt. Ltd. .

3. Brief facts leading to these appeals are as follows:

5. Having no other option, the appellants issued notice on 12.04.2006 calling upon respondent Nos. 1 to 4 to pay compensation for the loss and damages incurred and sustained by the appellants. A reply was issued by respondent Nos. 1 and 3. However, respondent 5 Nos. 2 and 4 did not reply. Even in the reply sent by respondent Nos. 1 and 3, they did not give a proper explanation inasmuch as the business of the Consumer Imaging Division was transferred to respondent No. 3. Thereafter, the appellants approached the State Consumer Disputes Redressal Commission, U.P. at Lucknow (hereinafter referred to as ‘the State Commission’) by filing Complaint Petition No. 7 of 2007, which came to be allowed in part on 21.02.2011. The State Commission held respondent Nos. 2 and 4 responsible for unfair trade practice and directed payment of compensation on account of loss, mental and physical torture and expenses of the complainants.

7. Similarly, respondent Nos. 2 and 4 also preferred First Appeal No. 222 of 2011 before the National Commission on 23.05.2011 raising various grounds including the ground that the appellants did not come within the definition of “Consumer” under the Consumer Protection Act, 1986 (hereinafter referred to as the ‘Act’), read with the 6 Consumer Protection (Amendment) Act, 2002. By the impugned judgment dated 09.02.2015, the National Commission dismissed the First Appeal No. 194 of 2011 filed by the appellants and allowed the First Appeal No. 222 of 2011 filed by the respondents.

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 Allrounder” 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 12 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 13 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 14 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.

16. In view of the same, it cannot be said that the appellants do not fall within the definition of the term “consumer”, as envisaged under Section 2(1)(d) of the Act. Hence, the impugned judgment and order dated 09.02.2015 passed by the National Commission is liable to be set aside and the judgment dated 21.02.2011 passed by the State Commission is restored, with the clarification that respondent Nos. 2 to 4 are jointly and severally liable to make good the loss, as directed by the State Commission. The appeals are allowed accordingly.

Leave granted.

The appeals are allowed.

Pending Interlocutory Applications, if any, stand disposed of.

(Signed non-reportable Judgment is placed on the file)