Case Title: Kundan Palace Vs. Awadhesh Kumar Mishra
Case Number: R.P. No. 548/2021
Today’s article unpacks a recent decision by the National Consumer Disputes Redressal Commission, led by Dr. Inder Jit Singh. The Commission ruled that venue owners are under no obligation to return any advanced payment in the event of cancellations, even if the reasons are valid. This is due to the fact that a booking effectively prevents the venue owner from accepting new clients, resulting in a potential loss.
Let’s break down the case. The complainant had paid Rs. 25,000 in advance to book the Kundan Palace Marriage Hall for his daughter’s wedding. However, the wedding had to be postponed due to a death in the groom’s family. After notifying the venue both verbally and in writing, the complainant was assured his advance payment would be refunded within 15 days. However, this did not happen. Despite numerous legal notices sent by the complainant’s lawyer, the venue hall only acknowledged receiving Rs. 4,500, issuing a receipt with no mention of the complainant’s name. This led to the complainant lodging a complaint with the District Forum, which ruled in his favour and ordered the venue to pay Rs. 20,000 plus 9% interest. This decision, however, was challenged by the venue hall in the State Commission, which upheld the District Forum’s ruling. The venue hall then filed a revision petition with the National Commission.
The venue hall argued that the State Commission failed to consider the conditions specified on the receipt’s backside, which clearly stated that the deposit would not be refunded in case of a cancellation. They also pointed out inconsistencies in the application form concerning the deposit amount, suggesting that the complainant had tampered with the form to show a larger deposit, misleading the lower courts.
The National Commission noted that the standard non-refundability clause for advance payments was fair, as late cancellations can lead to the venue owner missing out on other potential bookings. They also pointed out that the complainant had not claimed that the venue was re-booked after their cancellation. Reviewing the receipt’s conditions, the Commission found a clause stating that the rental amount was non-refundable under any circumstances. The complainant could not provide a receipt for the Rs. 25,000 they claimed to have paid as an advance. The document they did present only had “25 deposited” written by hand, which was not sufficient evidence to prove that Rs. 25,000 had indeed been paid. Therefore, the Commission concluded that the venue owner was not required to refund the booking amount, even if the cancellation was due to a genuine reason. It was in line with the standard conditions and common practice in the industry. As a result, the Commission set aside the decision of the District and State Commissions, dismissed the complaint, and allowed the revision petition.
This case serves as a reminder of the importance of clearly understanding terms and conditions before making a booking. It highlights that even in the face of genuine reasons for cancellation, venue owners are protected from the financial impact of last-minute changes.
