Consumer Protection Act, 1986 – ss. 2(1)(d), 2(1)(f) – Consumer  – Commercial purpose – Defect in the car Complainant purchased two high priced luxury cars for the personal use of its Directors and for his family members, as a part of the perquisite to the Director from the appellant company – Persistent problem of hump heating in one of the car  – Complaint and applications before the National Commission – National Commission awarded the compensation by directing the appellants to refund the purchase price-Rs. 58 lakhs approx. to the complainant, and take back the car – Interference with: 

Held: No material to suggest that the purchase of car had a nexus or was linked to any profit generating activity of the company, as such it could not be said that such a high-priced luxurious car was purchased by the complainant for its “commercial purpose” – It  was clearly established by the complainant that an excessive heat was generated in the car – Appellant though not admitted specifically about the said defects in the car, had indirectly stated about the same in the applications filed before the Commission – Thus, the inherent defect of overheating of the car had persisted despite the appellant having provided the rectification measures like providing additional insulation in the car, which caused great inconvenience and discomfort to the passengers seated in the car – Such overheating of the surface of hump and the overall high temperature in the car was a fault, imperfection or shortcoming in the quality or standard which was expected to be maintained by the appellants under the contract with the complainant and thus, was a ‘defect’ within the meaning of s. 2(1)(f) – People do not purchase the high-end luxurious cars to suffer discomfort more particularly when they buy the vehicle keeping utmost faith in the supplier who would make the representations in the brochures or the advertisements projecting and promoting such cars as the finest and safest automobile in the world – Complainant having suffered great inconvenience, discomfort and also the waste of time and energy in pursuing the litigations, the impugned order passed by the National Commission directing the appellants to refund the purchase price-Rs. 58 lakhs approx. to the complainant, and take back the car does not warrant any interference – However, having regard to the offer made by the appellants to repurchase the car, and having regard to the complainant having retained and used the car for about seventeen years, in the interest of justice and balance of equity the complainant permitted to retain the car and the appellant to refund Rs. 36 lakhs instead of Rs. 58 lakhs to the complainant by way of compensation within the stipulated time. [Paras 17, 23, 24, 25, 40

Consumer Protection Act, 1986 – s. 2(1)(d), 2(1)(r) – Consumer – Commercial purpose – Deficiency in the services – Unfair trade practice – Complainant’s case that they purchased Mercedes Benz, E-Class-E 240 petrol version car from the appellants for its Managing Director based on its safety features – Said car met with the accident, the car was being driven by the company driver, while the director was seated on the rear left side seat of the car, and the driver was wearing the seat belt, whereas the Director did not wear the seat belt – At the time of accident, neither the airbags on the front side nor the airbags on the side of the the Director opened, as a result the  Director sustained grievous injuries, and the driver sustained some minor injuries – Complainants filed the complaint seeking compensation – National Commission directed the appellants to pay a sum of Rs. 5 lakhs to the complainant for the deficiency in the services rendered to it on account of the airbags of the car having not deployed/triggered and further directed the appellants to pay a sum of Rs. 5 lakhs as compensation to the complainant for the unfair trade practice indulged into by them – Interference with:

Held: Not called for – Trade practice which for the purpose of promoting the sale of any goods by adopting deceptive practice like falsely representing that the goods are of a particular standard, quality, style or model, would amount to “unfair trade practice” within the meaning of s. 2(1)(r) – It cannot be said that the purchase of the car by the company for the use of its director would tantamount to purchase for commercial purpose – Appellants failed to bring on record any material to show that the dominant purpose or dominant use of the car was for commercial purpose or that the purchase of the car had any nexus or was linked with any profit generating activity of the complainant company, thus, the complaint was maintainable – Nothing produced by the appellants to show that they had disclosed either in the Owner’s Manual or in the Brochure about the limited functioning of the airbags, which according to them was an additional safety measure in the car – On the contrary, the complainant’s case that misrepresentation was made by the appellants at the time of promotion of the car that it had a safety system which included front airbags, side-airbags and window airbags – Even if it is accepted that the airbags would deploy only when the seat belt was fastened by the passenger, admittedly, the frontal airbags of the car were not deployed though the driver had already fastened the seat belt – Thus, the defect in the car clearly established as regards non-deployment of frontal airbags – National Commission rightly considered incomplete disclosure or non-disclosure of the complete details with regard to the functioning of the airbags at the time of promotion of the car, as the “unfair trade practice” on the part of the appellants, and awarded a sum of Rs. 5 lakhs towards it as also rightly balanced the equity by awarding Rs. 5 lakhs towards the deficiency in service on account of the frontal airbags of the car having not deployed at the time of accident. [Para 40] . 

Consumer Protection Act, 1986 – s. 2(1)(d) – Consumer – Commercial purpose – Purchase of a vehicle/good by a Company for the use/personal use of its directors, if would amount to purchase for “commercial purpose” within the meaning of s. 2(1)(d) – Determination:

Held: Would depend upon facts and circumstances of each case – However ordinarily “commercial purpose” is understood to include manufacturing/industrial activity or business-to-business transactions between commercial entities – Purchase of the goods should have a close and direct nexus with a profit generating activity – It has to be seen whether the dominant intention or dominant purpose for the transaction was to facilitate some kind of profit generation for the purchaser and/or their beneficiary – If it is found that the dominant purpose behind purchasing the goods was for the personal use and consumption was not linked to any commercial activity, it need not be looked into, if such purchase was for the purpose of “generating livelihood by means of self-employment” – Said determination cannot be restricted in a straitjacket formula and has to be decided on case-to-case basis – Furthermore, in a consumer complaint, the onus to prove that the goods were purchased for “commercial purpose” and thus, such goods would fall outside the definition of “consumer” contained in s. 2(1)(d), would be on the opponent-seller and not on the complainant-buyer. [Para 17]