WHAT IS COMMERCIAL PURPOSE AS DEFINED IN CONSUMER PROTECTION ACT

Natonal Commission had clarified many doubts  on the issue of definition of consumer and  commercial purpose  as back as in 2004 vide order dated 3.12.04 .this was avery elaborated judgement pronounced by Justice M B Shah which dealt with the issue from all possible angles and this order was not challenged before the Apex court but thereafter supreme court also maintained the same stand in number of cases .The issue is still alive due to varied interpretations in varied circumstances of the facts .Once again supreme court made fine distinction of the facts as to when unit is a considered to be running for commercial purpose .

 After amendment 2002 in the consumer protection Act 1986 , suddenly all the doors for commercial units were closed and sealed, for them and they were barred from going  to consumer forums for their redressal in case of deficiency in services against service providers .If a commercial electricity connection is not given inspite of fulfilling all the formalities by the the subscriber,such subscriber has no remedy to raise a question of deficiency in services before the consumer forum because the unit is to run a business for profit and gain at the premises for which connection is applied.It happend because amendment  had clearly barred to entertain by using the word commercial purpose However  small shopkeepers indulged into activity for self employment were yet entertained.Similarly insurance taken by a commercial unit /business house in no way was considered to be a consumer for the purpose of services under consumer protection act considering it a commercial unit.Consumer forums were not  comfortable under the situation when convinced with the fact that meter applied for is no doubt  under commercial category but giving connection is just a service before any activity of commecial nature starts or person uses it for self employment.In other cases of self livlihood some relaxation consumers are receiving but for commercial electricity connection situation is just No.

                                                The judgement pronounced by Honourable National Consumer Dispute Redressal Commition in this context was  a remarkable explaination to the word Commercial Purpose.At times it is seen that the words loose their meaning by much use in one particular sense and in due course adapts a very conservative shape.This judgement prounced by Honourable Justice M B Shah has lifted the veil and taken us to the earlier decided cases by the apex court wherein the meaning of commercial purpose was explained as back as 1995 in case of Luxmi engineering works Vs PSG Institute[1995]3 SCC 585.and lately in New Delhi municipal corporation vs Sohan lal Sachdeva[2002] 2 scc 494 wherein commerce and commercial pupose is defined.But the fact remains, no consideration for commercial units for one and all is the situation till date

No doubt we have to see the purpose behind the legislature

as to why re sale or commercial purpose was barred.Rightly it was thought to give more opportunities to poor and helpless consumers with limited resources to fightout against giant companies having battery of eminent lawyers on their panel. This was also the idea that mighty business group having enough resources can seek their remedy before civil court by paying court fee and more small consumers should be entertained by consumer forums.This idea was very much there in the mind of National Commission while delivering this judgement as it has been carefully spelledout and distinguished between the unit having direct  relation with profit and loss activity  and a commercial unit availing or hiring services for other than commerce trade or profit&loss making.

                                                In the matter between M/S Harsolia Motors Vs M/S National Insurance co. Ltd ,M/S Diwakar Goiram Porkhayat Vs m/s national Insuranci Co. Ltd and also in M/S Tractor House VsM/S National Insurance Co. Ltd National commission dealt with above stated appeals together The basic question for adjudication was whether insurance policy taken by commercial units could be held to be hiring of services for commercial purpose and thereby excluded from the perview of the consumer protection act.The words for explanation before the commission were commercial purpose,commerce, services,and mainly services of insurance hired,taken ,availed by the insurer  Crux of the whole discussion in this order is explained in the following manner :

                                                1 Taking insurance policy by an individual is a service under the act.

                                                2 Taking insurance policy by a commercial unit running its business is a service as far as it is limited to indemnification of the actual loss suffered by the insurer under the act but cannot be considered service taken if taken licence and registered for doing business of insurance.

                                             For coming to this conclusion, commission has gone far ahead in explaining as to how in  one situation services hired or availed is a service for commercial purpose and in other situation not commercial purpose by giving reference of earliar decided case of Luxmi Engineering Works Ltd in 1995.  and it has been emphasized  

·         If a typewriter is used for typing by the person for himself and a car purchased for his own driving for self employment – it is not for commercial purpose

·         If a typewriter is purchased and is being used for other person for giving typing services to others for profit or loss by a commercial unit it is a commercial purpose .

·         Similarly a car driven as taxi by employees of commercial unit for giving transport services is a commercial purpose but car used by an officer of the unit for his own use is not a commercial purpose

                                    There has been no change brought in the earliar position,it has just been help taken from the earliar judgements by the apex court to explain the meaning.It is further explained ,electricity services /hired/availed or taken by a commercial unit for the purpose of using fans,lights etc.is not for commercial purpose but when electricity licence is taken  for further distribution of supply to the customers  making profit and loss/ in trade,commerce or manufacturing, it is commercial purpose.Lathe machine used by power point in the commercial unit shall bar the unit for falling under the definition of a consumer under the Act.and is a commercial purpose

                                                Here come the words direct  profit or loss which has been pinpointed as criteria to decide the purpose whether commercial or not.After this judgement nothing more is left to be explained as to what is commercial purpose.Consumer redressal agencies are left with their Neer Ksheer Vivek like a swan for segregating the terms resale or self employment; commercial use for the purpose of commerce/trade/profit&loss;direct  relation with commerce /trade/business etc.

                                                Avery big Gate is opened for enterance of many to the definition of consumer after this judgement Let us take the electricity services Untill and unless electricity is not taken for further delivery to some people or directly  used for the purpose of manufacturing/trading/commerce, it is a service under consumer protection act may it be a commercial connection.Categarisation of domestic commercial agricultural or industrial is meant for Electicity board is for their purpose and not for defining the meaning under the Consumer Protection Act.

                                                Insurance is clearly defined ,no need any further discussion.

                                                Telephone connections also meet the same fate as electricity services

                                                Likewise will be the things now.Flood of cases are expected to pour in for interpretations. We have to wait and watch, how the things take shape in due cource of time.

 

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