Order Name: Telco Construction Equipment Co. Ltd Vs. Stone International Pvt. Ltd. & Ors
Case No.: F.A. No. 396/2011
In a case involving Telco Construction and Stone International Pvt. Ltd., the National Consumer Disputes Redressal Commission (NCDRC) overruled a previous judgment given by the state commission. The NCDRC, led by Subhash Chandra and Sadhna Shanker, ruled in favour of Telco, stating that Stone International did not categorically fall under the ‘consumer’ category as they had received a warranty on their commercial purchase.
The dispute started when Stone International, a company involved in excavation operations, bought a Hydraulic Excavator from Telco Construction for Rs 44 lakhs. Soon after the purchase, the company reported operational issues, which Telco addressed under the one-year or 2000-hour warranty. Despite a replacement of the engine and continued services, the company filed a complaint alleging manufacturing defects and demanded a new excavator or compensation for their losses.
The state commission partly allowed their complaint, asking Telco to pay Rs. 15 lakhs for repair charges, Rs. 10 lakhs for mental distress, and Rs. 20,000 for litigation costs. However, Telco appealed this decision in the NCDRC, challenging the contention that Stone International qualified as a ‘consumer’ under the Consumer Protection Act, 1986.
The NCDRC, upon review, found that the state commission’s decision was flawed. According to the Commission, since the excavator was purchased for commercial use, Stone International did not qualify as a ‘consumer’ under the Consumer Protection Act, 1986, as per the 2003 amendment. This amendment excludes goods and services used for a ‘commercial purpose’ from the definition of ‘consumer.’
The Commission also noted that the fact that the excavator required frequent repairs during the warranty period did not necessarily suggest inherent manufacturing defects that would require a replacement or refund. Additionally, the Commission pointed out that Stone International did not provide an expert opinion from a suitable laboratory to support the claim of deficiency, as required by Section 13(1)(c) of the Act.
In conclusion, the Commission found merits in the arguments put forth by Telco and decided to overturn the state commission’s order. This judgment underlines the importance of understanding the definitions and exclusions under the Consumer Protection Act before filing a complaint. The case also highlights the need for substantial evidence to support allegations of product deficiency or service lapses.
