Neena Aneja & Anr.

 Versus

Jai Prakash Associates Ltd (SC)

 

Civil Appeal Nos. 3766-3767 of 2020

 

Decided on -16^TH March 2021

Legal Points ;

 Transitional provisions after repeal of old Act 1986 and enforcement of Act 2019 on July 2020

!)Pecuniary  Jurisdiction of the commission in between  after enactment of the act and before enforcement notification

 

!!)Law on appeal for submitting 50% decrital amount which are contratry to the fundamental right of a consumer /litigant

!!!) Status of Members AND Presidents working in the commission at the time of repeal of the act

!V)Question of transfer of cases to the commissions after pecuniary jurisdiction changed 

 

Background

 

The Consumer Protection Act 20191 was published in the Gazette of India on 9 August 2019. By S.O. 2351(E) dated 15 July 2020, the provisions of the Act of 2019 were notified to come into force on 20 July 2020. By S.O. 2421(E) dated 23 July 2020 several other provisions were brought into force, with effect from 24 July 2020. Since the act was passed on 9^th of August 2019 some of the commissions started accepting cases on the basis of new pecuniary jurisdiction set under the act and in some other cases after notification date of enforcement of the act 2019 . This is how this case has come up before the honourable Supreme Court clubbing together many cases

Hon’ble Supreme Court has analysed about the Position of law on change of forum through various previously decided cases by this Supreme court benches comprising two judges bench ,three judges bench and constitutional benches and also cases decided by the various High Courts on this particular issue for coming to the logical conclusion about the Legislative Scheme of the jurisdictional provisions

 

Referred Cases ;

C.1. Venugopala Reddiar (1943- Federal Court 3 judges)

C.2. Kiran Singh v. Chaman Paswan (1954- Supreme Court 4 judges)

C.3. Garikapati (1957- Supreme Court Constitution Bench)

C.4. Mohd. Idris (1965- Supreme Court Constitution Bench)

C.5. Manujendra Dutt (1966- Supreme Court 2 judges)

C.6. New India Assurance (1975- Supreme Court 3 judges)

C.7. Maria Cristina (1978- Supreme Court 2 judges)

C.8. Hitendra Vishnu Thakur (1994- Supreme Court 2 judges)

C.9. Sudhir G Angur (2005- Supreme Court 3 judges)

C.10. Ramesh Kumar Soni (2013- Supreme Court 2 judges)

C.11. Dhadi Sahu (1992- Supreme Court 2 judges)

C.12. Ambalal Sarabhai (2001- Supreme Court 2 judges)

C.13. HP State Electricity (2013- Supreme Court 2 judges)

C.14. Videocon International (2015- Supreme Court 2 judges)

C.15. SEBI v. Classic Credit (2018- Supreme Court 2 judges)

C.16. Swapna Mohanty (2018- Supreme Court 2 judges)

C.17. Om Prakash Agarwal (2018- Supreme Court 2 judges

Facts of the case;

It’s a case of a home buyer who made  payment of an advance of Rs.3.50 lacs on 25 November 2011and was provisionally allotted a residential unit in a real-estate project described as KRESCENT Homes admeasuring a super built area of 114.27 square metres which was being developed by the builder at Jaypee Greens, Noida. The total consideration was fixed at Rs.56.45 lacs and possession was intended to be conveyed within a period of 42 months from the execution of the agreement of the provisional allotment letter. Home Buyer Syates they have paid an amount of Rs. 53.84 lacs out of the total consideration of Rs.56.45 lacs. between December 2011 till date.

After builder failed to meet the obligations ,Home buyer who is   the appellant in the present case ought a refund of the consideration together with interest at 18 per content  On 13 June 2017 and 27 April 2020. 

On 18 June 2020, the appellants instituted a consumer complaint before the NCDRC for refund with interest.

The NCDRC by its order dated 30 July 2020 dismissed the consumer case on the ground that after the enforcement of the Act of 2019, its pecuniary jurisdiction has been enhanced from rupees one crore to rupees ten crores.

In the present case, the claim of Rs. 2.19 crores is below the enhanced pecuniary jurisdiction of the NCDRC. . The appellants’ review petition was also dismissed by the NCDRC on 5 October 2020. In the present case, the claim of Rs. 2.19 crores is below the enhanced pecuniary jurisdiction of the NCDRC.

 

 The complainants in the consumer case are in appeal.

 

It is pertinent to note that the appellants are also aggrieved by the fact that contrary to the position taken in its case, other Benches of the NCDRC have admitted complaints instituted before 20 July 2020)

 

Legal point !) Pecuniary  Jurisdiction of the commission in between  after enactment of the act and before enforcement notification

 

Facts of the  case

 

Consumer complaint was filed before the National commission before the inforcement notification which was dismissed on the point of pecuniary jurisdiction on 30 July 2020 i.e after the act came into force. A review preferred was also dismissed on 5^th Oct 2020

Supreme court while deciding this appeal has come to the conclusion

That proceedings instituted before the commencement of the Act of 2019 on 20 July 2020 would continue before the fora corresponding to those under the Act of 1986 (the National Commission, State Commissions and District Commissions) and not be transferred in terms of the pecuniary jurisdiction set for the fora established under the Act of 2019.In the above referred case  , the appellants instituted a consumer complaint before the NCDRC for refund with interest. On 18 June 2020

 

·         While allowing the appeals, we issue the following directions

(i) The impugned judgment and order of the NCDRC dated 30 July 2020 and the review order dated 5 October 2020, directing a previously instituted consumer case under the Act of 1986 to be filed before the appropriate forum in terms of the pecuniary limits set under the Act of 2019, shall stand set aside;

(ii) As a consequence the National Commission shall continue hearing the consumer case instituted by the appellants

(Noted Principal ; The expression “entertain” has been considered in a two judge Bench decision of this Court in Hindusthan Commercial Bank Ltd. v. Punnu Sahu (Dead) Through Legal Representatives60, in the context of the provisions of Order XXI Rule 90 of the CPC. The Court has accepted that the expression “entertain” means to adjudicate upon or proceed to consider on merits.)

 

 

The above order and directions make it ample clear that any proceedings initiated during the act 1986 and before enforcement of the act 2019 shall be considered for pecuniary jurisdiction under act 1986 only

 

Legal point !!!) Law on appeal for submitting 50% decrital amount which are contratry to the fundamental right of a consumer /litigant

 

The  substantial changes have been made in the provisions for appeal contained in the Act of 2019. For instance, Section 19 of the Act of 1986 required an aggrieved person to either deposit 50 per cent of the amount awarded by the SCDRC or Rs 25,000, whichever is less. However, in the Act of 2019, the second proviso to Section 51(1) stipulates that an appeal shall not be entertained by the NCDRC unless the appellant has deposited 50 per cent of the amount required under the order of the SCDRC.

The question was raised on thie issue of depositing 50/% decrital amount as necessary condition for accepting appeal . It was argued that this provision is procedural in nature and every person has fundamental  right to appeal.Hence no condition should be attached to this provision

But Supreme Court held; This provision substantially affects the vested right of a litigant and is not merely procedural in nature.A case of  Garikapati Veeraya v. N Subbiah Choudhry was referred to explain the theory

 

In Garikapati Veeraya v. N Subbiah Choudhry, the Constitution Bench of this Court has held that a right of appeal is not a mere matter of procedure but is a substantive right and that the institution of a suit carries with it the implication that all rights of appeal then in force are preserved.

In the present case, the earlier legislation was in force when the complaint was filed and hence the rights and obligations which accrued on that date would stand saved.

But, a statutory appeal which was provided to the complainant to the Supreme Court against an order of the NCDRC has been taken away by as a result of the Act of 2019 which stipulate that matters which will lie before the SCDRC will only be amenable to appeal before the NCDRC.

 

Hence the new provision made in the act 2019 is an express legislature not marely procedural but is substansive in nature.

 

Legal point  1 (!)!) Status of Members AND Presidents working in the commission at the time of repeal of the act

 

 

Now coming to the question of transitional provision after repeal of Act 1986,we may refer the Repeal Clause  

“107. Repeal and savings-

(1) The Consumer Protection Act, 1986 is hereby repealed.

 

(2) Notwithstanding such repeal, anything done or any action taken or purported to have been done or taken under the Act hereby repealed shall, in so far as it is not inconsistent with the provisions of this Act, be deemed to have been done or taken under the corresponding provisions of this Act.

 

The transitional provisions contained in Sections 31, 45 and 56 expressly indicate that the adjudicatory personnel who were functioning as Members of the District Commission, SCDRC and NCDRC under the erstwhile legislation shall continue to hold office under the new legislation. Such provisions are necessary because persons appointed to the consumer fora under the Act of 1986 would have otherwise demitted office on the repeal of the legislation. Parliament would be conscious of this governing principle and yet chose not to alter it in its application to the consumer fora.Hence in view of this express provision of Section 107 coupled with section 31 ,45 and 56 no change is desired in the status of members or presidents working in the commissions at the time of repeal of old act  

 

 

Legal Point !V) !!!)Whether the cases from all commissions are required to be  transferred to the other commissions in view of change in pecuniary jurisdiction

 

There is no provision for transfer of pending cases in the new Act of 2019 was another question to be delt by the Supreme Court 

Under Section 47 of the Act of 2019 of the new legislation, the jurisdiction of the SCDRC is to entertain complaints under the Act of 2019 above a certain value. The jurisdiction to entertain complaints under the legislation could only have been conferred by an express statutory provision for  transfer of  complaints filed under the old Act from the NCDRC to the SCDRC.

Replying to this query Court held  any direction for the transfer of existing cases would entail disturbing thousands of cases pending before the NCDRC and SCDRCs across the country. This would cause serious hardship and prejudice to consumers and a waste of judicial time invested till date. A similar question was dealt with by the NCDRC in its Judgment 8 April 2011 in Southfield Paints and Chemicals Pvt. Ltd. v. New India Assurance Co. Ltd. which construed Amending Act 62 of 2002 by which the pecuniary limits of jurisdiction were enhanced with effect from 15 March 2003. Relying on the earlier decision in Premier Automobiles Ltd. v. Dr Manoj Ramachandran17, the NCDRC had held that the amendments enhancing the pecuniary jurisdiction were prospective in nature. The legislature must be considered to be aware of this precedent.

 

The above data indicates that as on 31 October 2019, 21,216 cases were pending before the NCDRC and 1,25,156 cases were pending before the SCDRC. Many of these cases would have to be transferred if the view which the developer propounds is upheld. This will seriously dislocate the interests of consumers in a manner which defeats the object of the legislation, which is to protect and promote their welfare. Clear words indicative of either an express intent or an intent by necessary implication would be necessary to achieve this result. The Act of 2019 contains no such indication. The transitional provisions contained in Sections 31, 45 and 56 expressly indicate that the adjudicatory personnel who were functioning as Members of the District Commission, SCDRC and NCDRC under the erstwhile legislation shall continue to hold office under the new legislation. Such provisions are necessary because persons appointed to the consumer fora under the Act of 1986 would have otherwise demitted office on the repeal of the legislation.Similar intend can be presumed for transfer of cases also when it is specifically mentioned in section 107 to continue with the same arrangement so far it is not inconsistent to the new act

This intention appears likely, particularly in light of previous decisions of the NCDRC which had interpreted amendments that enhanced pecuniary jurisdiction, with prospective effect. The NCDRC, in Southfield Paints and Chemicals Pvt. Ltd. v. New India Assurance Co. Ltd.58 construed amending Act 62 of 2002 by which the pecuniary limits of jurisdiction were enhanced with effect from 15 March 2003 as prospective by relying on its earlier decision in Premier Automobiles Ltd. v. Dr Manoj Ramachandran59, where the NCDRC held that the amendments enhancing the pecuniary jurisdiction are prospective in nature  Dhadi Sahu (1992- Supreme Court 2 judges Dhadi Sahu (1992- Supreme Court 2 judges Parliament would be conscious of this governing principle and yet chose not to alter it in its application to the consumer fora.

Ref. 58 Consumer Case No. 286 of 2000 (NCDRC)

59 Revision Petitions Nos 400 to 402 of 1993 (NCDRC)

 

 

 

 

 

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