H.N. SHANKARA SHASTRYversusTHE ASSTT. DIRECTOR OF AGRICULTURE, KARNATAKA

A                        H.N. SHANKARA SHASTRY
                                        V.

        THE ASSTT. DIRECTOR OF AGRICULTURE, KARNATAKA

                                 MAY 6, 2004
B
         [SHIVARAJ V. PATIL AND D.M. DHARMADHIKARI, JJ.]

         Consumer Protection Act, 1986; Section 14(1) :

         Consumer filed a complaint against seller for selling sub-standard
C quality of seeds which has resulted in loss/damage to him-District Forum
  directed the seller to refund price of the seeds and also damages-State
  Commission modified the order directing the seller to refund the actual
  price of the seeds with interest thereon-Revision Petition dismissed by
  National Commission-On appeal, Held: since object of enactment of the
D Act was to better protect the interest of the consumer, provision of the Act
  ought to be interpreted accordingly in a rational manner to realize the
  objective-Since the complainant had established that seeds so supplied
  by the seller were defective, State Commission committed an error by
  modifj;ing the well-reas<>ned order ofthe District Forum deleting therefrom
E the compensation towards damages on ground that the complainant did
  not take appropriate steps to avoid the loss without any factslpleading-
  Hence, order of the State Commission/National Commission set aside and
  that of the District Forum restored.

F       Complainant-consumer purchased paddy seeds from the
  respondent-State for the purpose of sowing and transplanting the
  seeding to raise paddy in the land. However, the seeds did not
  germinate properly. He made a complaint to the respondent, who
  deputed an Officer to inspect the land and submit a report. The Officer
  reported that the germination was hardly 10 to 20 percent. Respondent
G in turn informed the National Seeds Corporation, the supplier of the
  seeds, about loss suffered by the consumer on account of supply of sub-
  standard quality seeds and that the National Seeds Corporation was
  liable to make good the loss suffered by the consumer. The National
  Seeds Corporation did not respond. The consumer filed a complaint
H against the seller under the provisions of the Consumer Protection Act
                                       406
H.N. SHANKARA SHASTRY v. ASSTT. DIRECTOR OF AGRICULTURE 407

claiming refund of price and also compensation. The District Forum A
directed the respondents to refund the price of the seeds and also
certain amount as compensation. On appeal, State Commission modified
the order directing the respondent to refund the price of the seeds with
interest thereon. It, however, deleted the amount of the compensation
on the ground that the consumer did not take appropriate steps to B
avoid such loss. The consumer filed a Revision Petition which was
dismissed by the National Commission. Hence the present appeal.

     Allowing the appeal, the Court

      HELD : I.I. The State Commission committed a serious error
                                                                          c
in its approach in expecting the appellant to take steps to avoid loss
to him even though the goods supplied by the respondent were
defective. The approach of the State Commission was merely theoretical
and not reasonable, there being no supporting facts or pleadings in that
regard. (411-B-C]                                                        D

      1.2. Under Section 14(1) of the Consumer Protection Act, 1986,
if the District Forum is satisfied that the goods complained against
suffer from any defect, it could grant reliefs which include return of
the price of goods and also compensation to the consumer for any loss E
suffered. Granting of relief to the consumer does not depend upon
whether he should have made alternative arrangement. In the present
case, it was enough for the appellant to establish that the paddy seeds
supplied by the respondent were defective. (411-F-G]
                                                                          F
     1.3. The State Commission has not kept in mind the very object
of the Act which was enacted to better protect the interest to the
consumers. The Act is one of the benevolent pieces of legislation
intended to protect a large body of consumers from exploitation. The
provisions of the Act ought to be interpreted in a rational manner for G
achieving the objective set forth in the Act. (411-H; 412-A]

    Secretary, Thirumurugan, Cooperative Agricultural Credit Society v.
M Lalitha (Dead) through L.Rs. & Ors., (2004] 1 SCC 305 and Lucknow
Development Authority v. MK. Gupta, (1994] 1 SCC 243, relied on.
                                                                          H
    408                SUPREME COURT REPORTS [2004) SUPP. 2 S.C.R.

A      1.4. The preamble of the Act can afford useful assistance to
  ascertain the legislative intention. The Consumer Protection Act was
  enacted 'to provide for the protection of the interest of consumers'. Use
  of the word 'protection' furnishes key to the minds of makers of the
  Act. Various definitions and provisions which elaborately attempt to
B achieve this objective have to be construed in this light without
  departing from the settled view that a preamble cannot control the
  otherwise plain meaning of a provision. (412-D-E)

          l.S. The importance of the Act lies in promoting welfare of the
C society by enabling the consumer to participate directly in the market
    economy. It attempts to remove the helplessness of a consumer which
    he faces against powerful, business, described as 'a network of rackets'
    or a society in which 'producers have secured power' to 'rob the rest'
    and the might of public bodies which are degenerating into storehouses
D   of inaction papers do not move from one desk to another as a matter
    of duty· and responsibility but for extraneous consideration leaving the
    common man helpless, bewildered and shocked. The malady is becoming
    so rampant, widespread and deep that the society instead of bothering,
    complaining and fighting against it, is accepting it as part of life. Under
E   the circumstances, the order of the State Commission, as affirmed by
    the National Commission, could not be sustained. Hence, the order
    made by the District Forum is restored. (412-F-G-H; 413-A, BJ

          CIVIL APPELLATE JURISDICTION : Civil Appeal No. 2253 of
F 1999.
         From the Judgment and Order dated 1.7.98 of the National Consumer
    Disputes Redressal Commission, New Delhi in R.P. No. 1321 of 1996.

          P.R. Ramasesh for the Appellant.
G
        Malika Arjun Reddy, S.R. Hegde and Anil K. Mishra for the
    Respondent.

          The Judgment of the Court was delivered by
H
H.N. SHANK.ARA SHASTRY v. ASSTT. DIRECTOR OF AGRICULTURE [PATIL, J.] 409

     SHIVARAJ V. PATIL, J. : The appellant approached the Consumer A
Disputes Redressal Forum (for short 'the District Forum') by complaining
that he purchased 10 bags of paddy seeds from the respondent @ 135 per
bag for the purpose of sowing and transplanting the seedlings to raise
paddy in 7 acres of his land. When he sowed the seeds in the nursery, they
did not germinate properly. He made complaint to the respondent; the B
respondent/deputed the Agricultural Extension Officer to inspect the land
and to submit his report about the quality of the seeds supplied to the
appellant; the said Officer having inspected the spot, reported that the
germination was hardly upto I 0 to 20%: having received the report, the
respondent addressed a letter to the Marketing Officer, National Seed C
Corporation, Mysore, stating that on account of sub-standard paddy seeds
sold to the appellant, the appellant had to leave 7 acres of his land fallow
and uncultivated and that the National Seed Corporation was liable to make
good the loss. The National Seed Corporation, in spite of the request of
the respondent, did not depute any technical expert to inspect the spot for D
assessment. According to the appellant, in the normal course, he would
have received 50 quintals of paddy from 7 acres of his land, the value of
the same would have been Rs. 15,750 calculated at the lowest rate
prevailing at the relevant time. He, therefore, claimed a sum of Rs. 17, 100
with consequential reliefs from the respondent. The only defence of the E
respondent was that the National Seed Corporation, which supplied the
 paddy seeds, was directly responsible for making good the loss and it
should have been made party to the proceedings and that the respondent
was not responsible to make good the loss. It was not disputed that the
respondent had sold paddy seeds @ 135 per bag to the appellant. The
District Forum on admitted facts held that the respondent was a "trader'; F
 in relation to the appellant. Both the parties filed respective affidavits
before the District forum· and the appellant, in addition, produced two
documents in support of his claim. The District Forum noticed that the
statement made in the affidavit of the appellant, that he could not raise and
harvest paddy in 7 acres of his land due to non-germination of the seeds G
purchased by him, was not denied by the respondent; the respondent had
only pleaded his ignorance as to whether the appellant had to leave 7 acres
of his land uncultivated. Having considered the contentions of the parties
and the material placed before it, the District Forum directed the respondent
 to pay a sum of Rs. 17,500 to the appellant by way of refunding of the H
    410                 SUPREME COURT REPORTS [2004) SUPP. 2 S.C.R.

A   price of the paddy se.:ds and damages caused to him as a result of the
    transaction. A further direction was given to pay Rs. I 00 as cost to the
    appellant.

          The respondent took up the matter in appeal before the Kamataka
B State Consumer Disputes Redressal Commission (for short 'the State
    Commission'). The State commission concurred with the !indings recorded
    by the District Forum but modified the order of the District Forum directing
    the respond en' to pay and refund a sum of Rs. 1,350, the price of the seeds.
    to the appellant wit!: interest thereon at 18% per annum from the date of
C its purchase. The State Commission also awarded a sum of Rs. 1,000 as
    compensation to the appellant. The reason for modifying the amount of
    compensation to be paid to the appellant is to be seen in paragraph 7 of
    the order of the State Commission which reads :

             "7. The germination of the paddy seeds in the nursery takes place
D            within a period of 8-10 days after its sowing. Therefore, the
             complainant would be able to know whether it was a proper
             germination or not within a period of 10-12 days. When the
             complainant had come to know about that there was no proper
             germination, he would have purchased some other seeds and put
E            it in the nursery am:: transplanted the same in his land, which he
             has not done. Simply because the complainant did not take crop
             i11 his land due to sub-standard seeds, it cannot be said that it was
             due to any act on the part of the opposite party. The opposite party,
             of course is liable for refunding the value of the seeds to the
             complainant and also certain amount of compensation for sowing
F            it in the nursery."

          Aggrieved by and not satisfied with the order of the State Commission,
    the appellant filed a revision petition before the National Consumer
    Disputes Redressal Commission (for short 'the National Commission').
G   The said Commission summarily dismissed the revision petition observing
    that it did not find any illegality or jurisdic:ional error in the order passed
    by the State Commission. Hence, this appeal.

          The learned counsel for the parties in their arguments reiterated the
H submissions that were made before the District Forum and the State
H.N. SHANKARA SHASTRY v. ASSTT DIRECTOR OF AGRICULTURE {i'ATIL. JJ 411

Commission.                                                                 A
      In view of the admitted position and the facts as found both by District
Forum as well as State Commission, it is unnecessary to refer to them
again. The only point that needs to be examined is whether the State
Commission was right and justified in reducing the amount of compensation B
for the reasons recorded in paragraph 7 extracted above. In our view, the
State Commission committed a serious error in its approach in expecting
the appellant to take steps to avoid loss to him even though admittedly the
goods supplied by the respondent were defective. The approach of the State
Commission was merely theoretical and not reasonable there being no
supporting facts or pleadings in that regard. It may be pointed out that the C
respondent did not plead before the District Forum or the State Commission
that the appellant by taking care or by making alternative arrangement
could have saved himself from the loss. The State Commission was also
not right in modifying the order of the District Forum merely on the basis
that the appe!lant could have been careful and could have cultivated 7 acres D
of his land by securing other seeds. It did not keep in mind that the nature
of agricultural operation, sowing the seeds in the nursery for germination
and transplanting them thereafter in the land depended entirely on the
season and the taning required; delay of two weeks in putting the seeds
or transplanting them may not be useful and many times it may not help E          ·
raising paddy crop even if it is sown; may be yield would have been
minimum and unviable. Be that as it may, neither there was a pleading nor
there was evidence touching this aspect of the matter.

      Under Section 14(1) of the Consumer Protection AcL 1986 (for sho1t F
'the Act'), if the District Forum is satisfied that the goods complain~d
against suffer from any defect. 'it could grant reliefs which include return
of the price of the paddy and al~o compensation to the consumer for any
loss suffered. Granting of relief to the consumer does not depend upon
whether he should have made alternative arrangement. In the present case.
it w~:; enough for the appellant to establish that the paddy seeds supplied G
by the respondent were defective.

      In this regard, the District Forum and the State Commission have
recorded concurrent findings of fact. The State Conunission also has not
kept in mind the very object of the Act which was enactecl to better protect tJ
    412                 SUPREME COURT REPORTS [2004] SUPP. 2 S.C.R.

A the interest of the consumers. The Act is one of the benevolent pieces of
  legislation intended to protect a large body of consumers from exploitation.
  The provisions of the Act ought to be interpreted in a rational manner for
  achieving the objective set forth in the Act. The approach of the Forums
  has to be rational consistent with the purpose of the Act rather than
B technical. In Secretary, Thirumurugan Cooperative Agricultural Credit
  Society V. M. Lalitha (Dead) through LRs. & Urs., [2004] I sec 305, this
  Court has expressed that ''Having due regard to the scheme of the Act and
  purpose sought to be achieved to protect the interest of the consumers
  better, the provisions are to be interpreted broadly, positively and
  purposefully." This Court in Lucknow Development Authority v. MK
C Gupta, [1994] I SCC 243 has observed that "it appears app:opriate to
  ascertain the purpose of the Act, the objective it seeks to achieve and the
  nature of social purpose it seeks to promote as it shall facilitate in
  comprehending the issue involved and assist in construing various provisions
  of the Act effectively. To begin with the preamble of the Act, which can
D afford useful assistance to ascertain the legislative intention, it was enacted,
  'to provide for the protection of the interest of consumers'. Use of the word
   'protection' furnishes key to the minds of makers of the act. Various
  definitions and provisions which elaborately attempt to achieve this
   objective have to be construed in this light without departing from the
E settled view that a preamble cannot control otherwise plain meaning of a
   provision. In fact the law meets long felt necessity of protecting the
  common man from such wrongs for which the remedv under ordinary law
   for various reasons has become illusory. Various legislations and regulations
   permitting the State to intervene and protect interest of the consumers have
F become a haven for unscrupulous ones as the enforcement machinery
   either does not move or it moves ineffectively, inefficiently and for reasons
   which are not necessary to be stated. The importance of the Act lies in
   promoting welfare of the society by enabling the consumer to participate
   directly in the market economy. It attempts to remove the helplessness of
   a consumer which he faces agamst powerful, business, described as, 'a
G network of rackets' or a society in which, 'producers have secured power'
   to 'rob the rest' and the might of public bodies which are degenerating into
   storehouses of inaction where papers do not move from one desk to another
   as a matter of duty and responsibility but for extraneous consideration
    leaving the common man helpless, bewildered and shocked. The malady
H is becoming so rampant, widespread and deep that the society instead of
H.N. SHANKARA SHASTRYv. ASSTT. DIRECTOR OF AGRICULTURE [PATIL, J.] 413

bothering, complaining and fighting against it, is accepting it as part oflife. A
The enactment in these unbelievable yet harsh realities appears to be a
silver lining, which may in course of time succeed in checking the rot."

      In view of what is stated above, we find it difficult to sustain the other
of the State Commission as affirmed by the National Commission. Hence, B
the impugned order affirming the order of the State Commission is set aside
and the order made by the District Forum is restored. The appeal is allowed
accordingly. No costs.

S.K.S.                                                      Appeal allowed.