Supreme Court of India
HUDAversusVIDYA CHETAL
- Citation
- 2019 INSC 1035
- Decided
- 16 September 2019
- Bench
- N V RAMANA
Holding
Statutory fees levied for services are within the definition of "service" under the Consumer Protection Act, 1986 and may be adjudicated by consumer forums if a deficiency in service is shown, thereby overruling HUDA v. Sunita.
Summary
The Supreme Court examined a Special Leave Petition challenging the earlier decision in HUDA v. Sunita, which held that the National Consumer Disputes Redressal Commission could not adjudicate statutory fees imposed by a development authority. The Court interpreted sections 2(1)(d), (g) and (o) of the Consumer Protection Act, 1986 and held that statutory fees levied for a specific service constitute a "service" within the Act’s ambit. Consequently, a deficiency in the performance of such service, including non‑fulfilment of conditions attached to the fee, can be addressed by consumer forums. The Court overruled the Sunita precedent, clarifying that consumer tribunals may examine the legality of statutory dues related to services, though challenges to the vires of the underlying rule remain for constitutional courts. The reference was answered, and the petitions were directed to a suitable bench after orders from the Chief Justice of India.
Issues considered
- Whether the judgment in HUDA v. Sunita that NCDRC lacks jurisdiction over statutory fees is valid.
- Whether statutory fees imposed by a development authority qualify as "service" under the Consumer Protection Act, 1986.
- Whether a deficiency in service can arise from the non‑fulfilment of conditions related to statutory fees.
- Interpretation of sections 2(1)(d), 2(1)(g) and 2(1)(o) of the Consumer Protection Act, 1986 concerning "deficiency" and "service".
- Whether consumer forums can adjudicate the legality of statutory dues or only constitutional courts can entertain vires challenges.
Legislation cited
- Consumer Protection Act, 1986s. 2(1)(d), s. 2(1)(g), s. 2(1)(o), s. 3
Subjects
Consumer Protection ActStatutory feesDeficiency in serviceJurisdiction of consumer forumsInterpretation of statutesDevelopment authorityOverruling precedent
Judgment
516 [2019]
SUPREME COURT 12 S.C.R. 516
REPORTS [2019] 12 S.C.R.
A PUNJAB URBAN PLANNING AND DEVELOPMENT
AUTHORITY (NOW GLADA)
v.
VIDYA CHETAL
B (Special Leave Petition (Civil) No. 4272 of 2015)
SEPTEMBER 16, 2019
[N. V. RAMANA, MOHAN M. SHANTANAGOUDAR AND
AJAY RASTOGI, JJ.]
Consumer Protection Act, 1986 – ss.2(1)(d)-(g), 2(1)(o) –
C
Interpretation of – Law laid down by Supreme Court in HUDA vs.
Sunita holding that the National Consumer Disputes Redressal
Commission (NCDRC) had no jurisdiction to adjudicate the legality
behind the demand of “composition fee” and “extension fee” made
by HUDA, as the same being statutory obligation, does not qualify
D as “deficiency in service” – Validity of – Held: Certain statutory
dues, such as fees, can arise out of a specific relation – Such statutory
dues might be charged as quid pro quo for a privilege conferred or
service rendered by the authority – There are exactions which are
for the common burden, like taxes, there are dues for a specific
purpose, like cess, and there are dues in lieu of specific service
E
rendered – Not all statutory dues/exactions are amenable to the
jurisdiction of the Consumer Forum – Exactions, like tax and cess
levied as a part of common burden or for a specific purpose,
generally may not be amenable to the jurisdiction of the Consumer
Forum – However, those statutory fees, levied in lieu of service
F provided, may in the usual course be subject matter of Consumer
Forum’s jurisdiction provided that there is a ‘deficiency in service’
etc. – Service provided by the petitioner squarely comes under the
ambit of ‘service’ – Determination of the dispute concerning the
validity of the imposition of a statutory due arising out of “deficiency
in service”, can be undertaken by the consumer fora as per the
G
provisions of the Act – Decision of Supreme Court in the case of
HUDA vs. Sunita, was rendered without considering any of the
previous judgments of Supreme Court and the objects of the Act –
Law laid down in the aforesaid case does not hold good and is
overruled – Present special leave petitions be placed before an
H
516
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 517
GLADA) v. VIDYA CHETAL
appropriate Bench for considering the case on merits after obtaining A
orders from the Hon’ble Chief Justice of India – Interpretation of
Statutes.
Words & Phrases – Meaning of expression ‘deficiency in
services’ – Explained – Consumer Protection Act, 1986 – s.2(1)(g),
2(1)(o). B
Interpretation of Statutes – Beneficial/remedial legislation –
Interpretation of – Discussed.
Words & Phrases – Distinction between ‘tax’ and statutory
dues, such as ‘fees’ – Held: Tax is a mandatory imposition by public
authority for public purpose enforceable by law – There is no element C
of quid pro quo between the tax payer and the public authority –
However, certain statutory dues, such as fees, can arise out of a
specific relation – Such statutory dues might be charged as quid pro
quo for a privilege conferred or a service rendered by the authority.
Answering the reference, the Court D
HELD: 1.1 Beneficial or remedial legislation needs to be
given ‘fair and liberal interpretation’. Meaning of deficiency is
explained as any fault, imperfection, shortcoming or inadequacy
in quality, nature and manner of performance of any service or
supply of goods, in terms of standards set by the parties E
themselves through contract or otherwise, or imposed by the
law in force. The basis for application of the consumer laws hinges
on the relationship between the service provider and consumer.
The usage of ‘otherwise’ within the provision subsumes other
modes of standard setting alternative instruments other than F
contracts such as laws, bye-laws, rules and customary practices
etc. Service is defined under Section 2(1)(o) of the Consumer
Protection Act, 1986. This definition is not exhaustive rather the
legislature has left the task to expound the provision on a case
to case basis to the judiciary. The purpose of leaving this provision
open ended, without providing an exhaustive list indicates the G
requirement for a liberal interpretation. Broadly speaking, it is
inclusive of all those services performed for a consideration,
except gratuitous services and contract of personal services.
Moreover, aforesaid provision reflects the legislative intent of
H
518 SUPREME COURT REPORTS [2019] 12 S.C.R.
A providing impetus to ‘consumerism’. Sovereign functions like
judicial decision making, imposition of tax, policing etc, strictly
understood, qualify for exemption from the Act, but the welfare
activities through economic adventures undertaken by the
Government or statutory bodies are covered under the
jurisdiction of the consumer forums. Even in departments
B
discharging sovereign functions, if there are sub-units/wings
which are providing services/supply goods for a consideration
and they are severable, then they can be considered to come
within the ambit of the Act. [Paras 6-10] 522-F; 523-B-C; F-G;
524-D-E]
C 1.2 In view of the law laid down, the interpretation provided
by the Sunita case cannot be sustained as the service provided
by the petitioner herein squarely comes under the ambit of
‘service’. The confusion, which arose from the aforesaid situation,
is that the authority does have the power to levy certain statutory
D fee. However, that itself does not prohibit the Consumer forums
from evaluating the legality of such exactions or fulfilment of
conditions by the authority before such exaction. In broad terms,
non-fulfilment of conditions or standards required, amounts to
‘deficiency in services’ under the Act. Having said that, out of
abundant caution, it is noted that the legality does not extend to
E the challenge of vires of a rule prescribing such fee. Such
contentions are best agitated before the Constitutional Courts.
On a different note, if the statutory authority, other than the core
sovereign duties, is providing service, which is encompassed
under the Act, then, unless any Statute exempts, or provides for
F immunity, for deficiency in service, or specifically provides for an
alternative forum, the Consumer Forums would continue to have
the jurisdiction to deal with the same. Need to caution against
over-inclusivity and the tribunals need to satisfy the ingredients
under Consumer Protection Laws, before exercising the
jurisdiction. [Paras 14-16] [527-E-G; 528-A-B]
G
1.3 Moreover, the distinction between statutory liability
which arise generally such as a tax, and those that may arise out
of a specific relationship such as that between a service provider
and a consumer, was not considered by this Court in the case of
H
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 519
GLADA) v. VIDYA CHETAL
Sunita. For instance, a tax is a mandatory imposition by a public A
authority for public purpose enforceable by law; and is not imposed
with respect to any special benefit conferred, as consideration,
on the tax payer. There is no element of quid pro quo between
the tax payer and the public authority. However, the above is not
the only form of due charged by a statutory authority. In a catena
B
of judgments, this Court has recognized that certain statutory
dues may arise from services rendered by a statutory authority.
Therefore, it is a clearly established principle that certain statutory
dues, such as fees, can arise out of a specific relation. Such
statutory dues might be charged as a quid pro quo for a privilege
conferred or for a service rendered by the authority. There are C
exactions which are for the common burden, like taxes, there
are dues for a specific purpose, like cess, and there are dues in
lieu of a specific service rendered. Therefore, not all statutory
dues/exactions are amenable to the jurisdiction of the Consumer
Forum, rather only those exactions which are exacted for a service
D
rendered, would be amenable to the jurisdiction of the Consumer
Forum. Those exactions, like tax, and cess, levied as a part of
common burden or for a specific purpose, generally may not be
amenable to the jurisdiction of the Consumer Forum. However,
those statutory fees, levied in lieu of service provided, may in the
usual course be subject matter of Consumer Forum’s jurisdiction E
provided that there is a ‘deficiency in service’ etc. [Paras 17, 19
and 20] [528-C-D; 529-E-H; 530-A]
1.4 The determination of the dispute concerning the validity
of the imposition of a statutory due arising out of a “deficiency in
service”, can be undertaken by the consumer fora as per the F
provisions of the Act. The decision of Supreme Court in the case
of Sunita, wherein it was held that NCDRC has no jurisdiction to
adjudicate the legitimacy of the aforementioned statutory dues,
was rendered without considering any of the previous judgments
of this Court and the objects of the Act. Consequently, the law
laid down in the aforesaid case does not hold good before the G
eyes of law, and is thereby overruled.[Para 22] [530-G-H; 531-A]
HUDA v. Sunita (2005) 2 SCC 479 – overruled.
H
520 SUPREME COURT REPORTS [2019] 12 S.C.R.
A Commissioner, Hindu Religious Endowments, Madras
v. Sri Lakshmindra Thirtha Swamiar of Sri Shirur Mutt,
[1954] SCR 1005 ; Kewal Krishan Puri and Anr. v. State
of Punjab and Anr. (1980) 1 SCC 416 : [1979] 3
SCR 1217 – followed.
B Lucknow Development Authority v. M.K. Gupta (1994)
1 SCC 243 : [1993] 3 Suppl. SCR 615 ; Ghaziabad
Development Authority v. Balbir Singh (2004) 5 SCC
65 : [2004] 3 SCR 68 – relied on.
Commissioner of Customs (Import), Mumbai v. Dilip
C Kumar and others (2018) 9 SCC 40 ; Om Prakash v.
Reliance General Insurance and Anr. (2017) 9 SCC
724 : [2017] 11 SCR 893 ; Standard Chartered Bank
Ltd. v. Dr. B. N. Raman (2006) 5 SCC 727 : [2006] 3
Suppl. SCR 558 – referred to.
D Justice Felix Frankfurter, Some Reflections on Reading
of Statutes, Columbia Law Review, VOL. 47, Issue 4,
PP. 527-546 ; Sutherland, Statutes and Statutory
Construction, 5505 (Callaghan, 1943) – referred to.
Case Law Reference
E (2005) 2 SCC 479 overruled Para 1
[1993] 3 Suppl. SCR 615 relied on Para 4
[2004] 3 SCR 68 relied on Para 4
(2018) 9 SCC 40 referred to Para 6
F [2017] 11 SCR 893 referred to Para 6
[2006] 3 Suppl. SCR 558 referred to Para 10
[1954] SCR 1005 followed Para 17
[1979] 3 SCR 1217 followed Para 18
G
CIVIL APPELLATE JURISDICTION : Special Leave Petition
(Civil) No. 4272 of 2015.
From the Judgment and Order dated 17.11.2014 of the National
Consumer Disputes Redressal Commission, New Delhi in Revision
Petition No. 889 of 2013.
H
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 521
GLADA) v. VIDYA CHETAL
With A
Special Leave Petition (C) No. 5237 of 2015.
Mrs. Rachana Joshi Issar, Ms. Prerana Chaturvedi,
Ms. K. Vaijayanthi, Advs. for the Petitioner.
Ms. Aishwarya Bhati, Sr. Adv., (A.C.) B
Respondent-in-person.
The Judgment of the Court was delivered by
N. V. RAMANA, J.
1. The reference before us arises out of the order dated 13.07.2018, C
passed by a two-Judge Bench of this Court, wherein they expressed
doubt as to the correctness of the judgment rendered in the case of
HUDA vs. Sunita, (2005) 2 SCC 479. This Court therein held that the
National Consumer Disputes Redressal Commission (hereinafter referred
to as “NCDRC”) had no jurisdiction to adjudicate the legality behind the
D
demand of “composition fee” and “extension fee” made by HUDA,
as the same being statutory obligation, does not qualify as “deficiency
in service”.
2. It is pertinent herein to note the opinion expressed by the two-
Judge Bench regarding the decision in the case of Sunita (supra) while
passing the referral order: E
“We are, prima facie, of the view that this six-paragraph order,
which does not, prima facie, contain any reason for the
conclusion reached, requires a relook in view of the fact that
the Consumer Protection Act, 1986 is a beneficent legislation”
F
3. The counsel on behalf of the petitioner submitted that the order
in the case of Sunita (supra) is well reasoned, as it validly holds that
the NCDRC lacks jurisdiction to decide the legitimacy behind the demand
of “composition fee” and “extension fee”. Relying on the aforesaid
holding, the counsel further stated that “statutory dues” cannot be claimed
as “deficiency in services”. Lastly, the learned counsel submitted that G
although the Consumer Protection Act, 1986 (hereinafter referred to as
“the Act”) is beneficial in nature, demanding a liberal construction, the
same cannot be used to extend the ambit of the Act by bringing in
remedies or benefits which were not intended by the legislature.
H
522 SUPREME COURT REPORTS [2019] 12 S.C.R.
A 4. On the contrary, the learned senior counsel appointed by this
Court as amicus curiae to assist and appear on behalf of the respondent
claimed that the order passed in the case of Sunita (supra), is an
aberration in a series of long-standing judgments by this Court. The
learned amicus curiae thereafter placed strong reliance upon the
judgments of this Court in Lucknow Development Authority v. M.K.
B
Gupta, (1994) 1 SCC 243, and Ghaziabad Development Authority
v. Balbir Singh, (2004) 5 SCC 65, wherein it was held that the NCDRC
has the jurisdiction to protect consumers against defective services
rendered even by a statutory body. Further, the learned amicus curiae,
while supporting the view that the Sunita case (supra) was per
C incuriam, has taken us through various judgments of this Court in this
regard and submitted that the statutory authorities come under the ambit
of the Act.
5. Heard the learned counsel appearing on behalf of the petitioner
and the learned amicus curiae in this case. The precise question raised
D before us is whether the law laid down by this Court in the case of
Sunita (supra) is valid. We may note that the validity of interpretation
furthered in the case of Sunita (supra) hinges on the interpretation of
Section 2(1)(d), 2(1)(e), 2(1)(f), 2(1)(g) and 2(1)(o) of the Act.
6. At the outset, we must remind ourselves that answer to majority
E of legal questions before Courts essentially lie in the process of
interpretation.1 This Court in Commissioner of Customs (Import),
Mumbai v. Dilip Kumar and others, (2018) 9 SCC 40, had emphasized
that the purpose of interpretation is to find the legislative intent of an
Act. It is established by umpteen number of cases in India and abroad
that beneficial or remedial legislation needs to be given ‘fair and liberal
F interpretation’ [refer Om Prakash v. Reliance General Insurance
and Anr., (2017) 9 SCC 724]. In this regard we may note that, the
liberal construction, extends the letter to include matters within the spirit
or purpose.2
7. Having observed the law on beneficial interpretation, we need
G to observe the concerned statutory provisions of the Act:
Section 2 (1) (g) “deficiency”- means any fault, imperfection,
shortcoming or inadequacy in the quality, nature and manner of
1
Justice Felix Frankfurter, Some Reflections on Reading of Statutes, Columbia Law
Review, VOL. 47, Issue 4, PP. 527-546
2
H Sutherland, Statutes and Statutory Construction, §5505 (Callaghan, 1943).
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 523
GLADA) v. VIDYA CHETAL [N. V. RAMANA, J.]
performance which is required to be maintained by or under any A
law for the time being in force or has been undertaken to be
performed by a person in pursuance of a contract or otherwise in
relation to any service.
Thus, meaning of deficiency is explained as any fault, imperfection,
shortcoming or inadequacy in quality, nature and manner of performance B
of any service or supply of goods, in terms of standards set by the parties
themselves through contract or otherwise, or imposed by the law in force.
The basis for application of the consumer laws hinges on the relationship
between the service provider and consumer. The usage of ‘otherwise’
within the provision subsumes other modes of standard setting alternative
instruments other than contracts such as laws, bye-laws, rules and C
customary practices etc.
8. Service is defined under Section 2(1)(o) of the Act, which reads
as under:-
(o) “service” means service of any description which is made D
available to potential users and includes, but not limited to, the
provision of facilities in connection with banking, financing
insurance, transport, processing, supply of electrical or other energy,
board or lodging or both, housing construction, entertainment,
amusement or the purveying of news or other information, but
does not include the rendering of any service free of charge or E
under a contract of personal service;
This definition is not exhaustive rather the legislature has left the
task to expound the provision on a case to case basis to the judiciary.
The purpose of leaving this provision open ended, without providing an
exhaustive list indicates the requirement for a liberal interpretation. F
Broadly speaking, it is inclusive of all those services performed for a
consideration, except gratuitous services and contract of personal
services. Moreover, aforesaid provision reflects the legislative intent of
providing impetus to ‘consumerism’. It may be noted that such a
phenomenon has had a benevolent effect on the Government undertakings, G
wherein a new dynamism of innovation, accountability and transparency
are imbibed.
9. On perusal of the impugned precedent, it may be noted that it
does not provide clear-cut reasoning for the view held by the Court,
H
524 SUPREME COURT REPORTS [2019] 12 S.C.R.
A except to the extent of pointing out that statutory obligations are not
encompassed under the Act. Such broad proposition necessarily required
further elaboration, as there is a possibility of over-inclusivity. Further,
there is no gainsaying that all statutory obligations are not sovereign
functions. Although all sovereign functions/services are regulated and
performed under constitutional/statutory instruments, yet there are other
B
functions, though might be statutory, but cannot be called as sovereign
functions. These sovereign functions do not contain the consumer-service
provider relationship in them and are not done for a consideration.
Moreover, we need to be mindful of the fact that sovereign functions
are undergoing a radical change in the face of privatization and
C globalization. India being a welfare State, the sovereign functions are
also changing. We may note that the government in order to improve the
quality of life and welfare of its citizens, has undertaken many commercial
adventures.
10. Sovereign functions like judicial decision making, imposition
D of tax, policing etc, strictly understood, qualify for exemption from the
Act, but the welfare activities through economic adventures undertaken
by the Government or statutory bodies are covered under the jurisdiction
of the consumer forums. Even in departments discharging sovereign
functions, if there are sub-units/wings which are providing services/supply
goods for a consideration and they are severable, then they can be
E considered to come within the ambit of the Act. [refer to Standard
Chartered Bank Ltd. v. Dr. B. N. Raman, (2006) 5 SCC 727]
11. Having observed the provisions and the interpretation of
pertinent provisions, we need to refer to Lucknow Development
Authority Case (supra), wherein this Court was concerned with the
F question as to the amenability of statutory authorities like Lucknow
Development Authority, for development of plots, to the Consumer
Protection Act, 1986.
12. This Court in Lucknow Development Authority Case (supra)
elaborated the meaning of ‘Consumer’, as occurring under Section
G 2(1)(b), in the following manner:-
“3……The word ‘consumer’ is a comprehensive
expression. It extends from a person who buys any
commodity to consume either as eatable or otherwise from
H
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 525
GLADA) v. VIDYA CHETAL [N. V. RAMANA, J.]
a shop, business house, corporation, store, fair price shop A
to use of private or public services.
…
It is in two parts. The first deals with goods and the other
with services. Both parts first declare the meaning of goods
and services by use of wide expressions. Their ambit is B
further enlarged by use of inclusive clause. For instance, it is
not only purchaser of goods or hirer of services but even those
who use the goods or who are beneficiaries of services with
approval of the person who purchased the goods or who hired
services are included in it.” C
(emphasis supplied)
13. Further, this Court elaborated on the meaning of the ‘service’
in the following manner:-
“4. What is the meaning of the word ‘service’? Does it extend to D
deficiency in the building of a house or flat? Can a complaint be
filed under the Act against the statutory authority or a
builder or contractor for any deficiency in respect of such
property.
…..
E
It is in three parts. The main part is followed by inclusive
clause and ends by exclusionary clause. The main clause
itself is very wide. It applies to any service made available
to potential users. The words ‘any’ and ‘potential’ are
significant. Both are of wide amplitude. The word ‘any’
F
dictionarily means ‘one or some or all’. In Black’s Law
Dictionary it is explained thus, “word ‘any’ has a diversity
of meaning and may be employed to indicate ‘all’ or ‘every’
as well as ‘some’ or ‘one’ and its meaning in a given statute
depends upon the context and the subject-matter of the
statute”. The use of the word ‘any’ in the context it has G
been used in clause (o) indicates that it has been used in
wider sense extending from one to all.
…
H
526 SUPREME COURT REPORTS [2019] 12 S.C.R.
A The legislative intention is thus clear to protect a consumer against
services rendered even by statutory bodies. The test, therefore, is
not if a person against whom complaint is made is a statutory
body but whether the nature of the duty and function performed
by it is service or even facility.”
B (emphasis supplied)
Thereafter, this Court answered the relevant question in the
following manner:-
“5. This takes us to the larger issue if the public authorities
under different enactments are amenable to jurisdiction
C under the Act. It was vehemently argued that the local authorities
or government bodies develop land and construct houses in
discharge of their statutory function, therefore, they could not be
subjected to the provisions of the Act. …
… Any attempt, therefore, to exclude services offered by statutory
D or official bodies to the common man would be against the
provisions of the Act and the spirit behind it. … A government or
semi-government body or a local authority is as much amenable
to the Act as any other private body rendering similar service.
Truly speaking it would be a service to the society if such
E bodies instead of claiming exclusion subject themselves to
the Act and let their acts and omissions be scrutinised as
public accountability is necessary for healthy growth of
society.
6. What remains to be examined is if housing construction or
F building activity carried on by a private or statutory body was
service within the meaning of clause (o) of Section 2 of the Act
as it stood prior to inclusion of the expression ‘housing construction’
in the definition of “service” by Ordinance No. 24 of 1993. … So
any service except when it is free of charge or under a
constraint of personal service is included in it. Since housing
G activity is a service it was covered in the clause as it stood
before 1993.
…
H
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 527
GLADA) v. VIDYA CHETAL [N. V. RAMANA, J.]
8…..Under our Constitution sovereignty vests in the A
people. Every limb of the constitutional machinery is obliged
to be people oriented. No functionary in exercise of
statutory power can claim immunity, except to the extent
protected by the statute itself. Public authorities acting in
violation of constitutional or statutory provisions
B
oppressively are accountable for their behaviour before
authorities created under the statute like the commission
or the courts entrusted with responsibility of maintaining
the rule of law. … Therefore, when the Commission has been
vested with the jurisdiction to award value of goods or services
and compensation it has to be construed widely enabling the C
Commission to determine compensation for any loss or damage
suffered by a consumer which in law is otherwise included in
wide meaning of compensation.
(emphasis supplied)
14. Coming back to the Sunita case (supra), this Court held that D
the NCDRC had no jurisdiction to adjudicate the legality behind the
demand of composition or extension fee by a developmental authority.
This Court observed that the statutory obligations of a developmental
authority and the plot holder under the authority’s statutory framework
cannot be construed as acts or omissions resulting in a “deficiency in E
service”. In view of the law laid down by us, the interpretation provided
by the Sunita case (supra) cannot be sustained as the service provided
by the petitioner herein squarely comes under the ambit of ‘service’.
15. We do understand that the confusion, which arose from the
aforesaid situation, is that the authority does have the power to levy F
certain statutory fee. However, that itself does not prohibit the Consumer
forums from evaluating the legality of such exactions or fulfilment of
conditions by the authority before such exaction. In broad terms, non-
fulfilment of conditions or standards required, amounts to ‘deficiency
in services’ under the Act. Having said that, out of abundant caution,
we note that the legality does not extend to the challenge of vires of a G
rule prescribing such fee. Such contentions are best agitated before the
Constitutional Courts.
H
528 SUPREME COURT REPORTS [2019] 12 S.C.R.
A 16. On a different note, if the statutory authority, other than the
core sovereign duties, is providing service, which is encompassed under
the Act, then, unless any Statute exempts, or provides for immunity, for
deficiency in service, or specifically provides for an alternative forum,
the Consumer Forums would continue to have the jurisdiction to deal
with the same.3 We need to caution against over-inclusivity and the
B
tribunals need to satisfy the ingredients under Consumer Protection Laws,
before exercising the jurisdiction.
17. Moreover, we also need to note that the distinction between
statutory liability which arise generally such as a tax, and those that may
arise out of a specific relationship such as that between a service provider
C and a consumer, was not considered by this Court in the case of Sunita
(supra). For instance, a tax is a mandatory imposition by a public authority
for public purpose enforceable by law; and is not imposed with respect
to any special benefit conferred, as consideration, on the tax payer. There
is no element of quid pro quo between the tax payer and the public
D authority. However, the above is not the only form of due charged by a
statutory authority. In a catena of judgments, this Court has recognized
that certain statutory dues may arise from services rendered by a
statutory authority. In the case of Commissioner, Hindu Religious
Endowments, Madras v. Sri Lakshmindra Thirtha Swamiar of Sri
Shirur Mutt, 1954 SCR 1005, a seven Judge-Bench of this Court held
E that-
“46. Coming now to fees, a “fee” is generally defined to be
a charge for a special service rendered to individuals by
some governmental agency. The amount of fee levied is
supposed to be based on the expenses incurred by the
F Government in rendering the service, though in many cases
the costs are arbitrarily assessed. Ordinarily, the fees are
uniform and no account is taken of the varying abilities of different
recipients to pay [ Vide Lutz on Public Finance, p. 215]. These
are undoubtedly some of the general characteristics, but as there
G may be various kinds of fees, it is not possible to formulate a
definition that would be applicable to all cases.
47. …The distinction between a tax and a fee lies primarily
in the fact that a tax is levied as a part of a common burden,
3
H Section 3 of the Act.
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 529
GLADA) v. VIDYA CHETAL [N. V. RAMANA, J.]
while a fee is a payment for a special benefit or privilege. A
Fees confer a special capacity, although the special advantage, as
for example in the case of registration fees for documents or
marriage licences, is secondary to the primary motive of regulation
in the public interest [Vide Findlay Shirras on Science of Public
Finance, Vol. I, p. 202]. Public interest seems to be at the basis
B
of all impositions, but in a fee, it is some special benefit which the
individual receives.”
(emphasis supplied)
18. A five Judge Bench of this Court, in the case of Kewal Krishan
Puri and Anr. v. State of Punjab and Anr., (1980) 1 SCC 416, also C
took note of the fact that certain statutory dues can arise from a quid
pro quo relationship between the authority and an individual upon whom
the liability falls.
“23. …(6) That the element of quid pro quo may not be possible,
or even necessary, to be established with arithmetical exactitude D
but even broadly and reasonably it must be established by the
authorities who charge the fees that the amount is being
spent for rendering services to those on whom falls the
burden of the fee.”
(emphasis supplied) E
19. Therefore, it is a clearly established principle that certain
statutory dues, such as fees, can arise out of a specific relation. Such
statutory dues might be charged as a quid pro quo for a privilege
conferred or for a service rendered by the authority. As noted above,
there are exactions which are for the common burden, like taxes, there F
are dues for a specific purpose, like cess, and there are dues in lieu of a
specific service rendered. Therefore, it is clear from the above discussion
that not all statutory dues/exactions are amenable to the jurisdiction of
the Consumer Forum, rather only those exactions which are exacted for
a service rendered, would be amenable to the jurisdiction of the Consumer
Forum. G
20. At the cost of repetition, we may note that those exactions,
like tax, and cess, levied as a part of common burden or for a specific
purpose, generally may not be amenable to the jurisdiction of the Consumer
H
530 SUPREME COURT REPORTS [2019] 12 S.C.R.
A Forum. However, those statutory fees, levied in lieu of service provided,
may in the usual course be subject matter of Consumer Forum’s jurisdiction
provided that there is a ‘deficiency in service’ etc.
21. We may also refer to the case of Ghaziabad Development
Authority (supra) wherein this Court, relying upon Lucknow
B Development Authority case (supra), held that the power of the
Consumer forum extends to redressing any injustice rendered upon a
consumer as well as over any mala fide, capricious or any oppressive
act done by a statutory body. The relevant para of the judgment reads as
under:
C “6. ….Thus, the law is that the Consumer Protection Act
has a wide reach and the Commission has jurisdiction even
in cases of service rendered by statutory and public
authorities. Such authorities become liable to compensate for
misfeasance in public office i.e. an act which is oppressive or
capricious or arbitrary or negligent provided loss or injury is suffered
D by a citizen.
…
Where there has been capricious or arbitrary or negligent
exercise or non-exercise of power by an officer of the
E authority, the Commission/Forum has a statutory obligation
to award compensation. If the Commission/Forum is
satisfied that a complainant is entitled to compensation for
loss or injury or for harassment or mental agony or
oppression, then after recording a finding it must direct
the authority to pay compensation and then also direct
F recovery from those found responsible for such
unpardonable behaviour.
(emphasis supplied)
22. Therefore, in line with the law laid down by us, we hold that
the determination of the dispute concerning the validity of the imposition
G
of a statutory due arising out of a “deficiency in service”, can be
undertaken by the consumer fora as per the provisions of the Act. The
decision of this Court in the case of Sunita (supra), wherein it was held
that NCDRC has no jurisdiction to adjudicate the legitimacy of the
H
PUNJAB URBAN PLANNING AND DEVELOPMENT AUTHORITY (NOW 531
GLADA) v. VIDYA CHETAL [N. V. RAMANA, J.]
aforementioned statutory dues, was rendered without considering any A
of the previous judgments of this Court and the objects of the Act.
Consequently, the law laid down in the aforesaid case does not hold
good before the eyes of law, and is thereby overruled.
23. The reference stands answered accordingly. The instant special
leave petitions may be placed before an appropriate Bench for considering B
the case on merits after obtaining orders from the Hon’ble Chief Justice
of India.
Divya Pandey Reference answered.
C
D
E
F
G
H
Search Indian case law
Ask in plain English, not just keywords. 25,000 AI words free, no card.
Try "Consumer Protection Act"Sign in to search