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Wednesday 5 June 2013

Borrowers Apathy under SARFAESI Act

This is in apropos to the article of Mr V. D.Rao published on 6th of June 2012. I have gone through the article. This article is quite praise worthy and full of facts. It focuses on the apathy of the borrowers who are subjected to litigation under the Securitization Act. It is my personal experience that some time for small reasons borrower has to face the burn of SARFAESI Act. This is due to extra ordinary power given to the banks. In most of the cases borrowers are defeated because they cannot afford to pay 75% as pre deposit for filing their appeal.

We the borrower of North East Region are quite new to this Act and due to ignorance and inadequate legal knowledge and support,  we are losing our appeals in DRT and DRAT and are deprived of our assets. Our valuable assets are being sold for a peanut price, as we are unable to deposit 75% of the debt due to the bank. We do not understand that when the bank has already taken the possession of our assets which is more than the value of the debt then why we are asked to deposit any further amount. When we have been already stripped off, where from can we make this deposit?

We are fighting for our cause with the little resources remaining with us and with a hope that we shall get justice. This will not be out of place to mention here that in our case, bank has betrayed us. Bank has acted like a property dealer and indulged in speculation .Our bank is a prime nationalized bank of the country. We got a SME loan in 80s’and our loan became NPA in 2003. Our unit became sick due to various factors including one that there were lot of discrepancies in our banks’ accounts resulting in incorrect application of interest, penal interest etc. etc. A revival package granted by the bank, proved unworkable due to unilateral changes and delay in implementation, as such we had to apply for an OTS. Bank neither rectified the errors in accounts nor gave any reply to our various reminders. Instead, in an arm twisting act, issued a SARFAESI notice.

As it was impossible to fight with the mighty bank, we   made a representation to the bank for OTS and in reciprocation to our representation; bank sent us a communication to deposit 5% of the offer amount which was duly deposited by us. Bank accepted the deposited amount without any objection. Now it was for the bank to intimate us the acceptance of the offer and about the amount so settled by the bank.

However, since then we were awaiting for the communication from the bank regarding acceptance of our proposal and fixation of the settled amount as per the OTS communication from the bank. In view of the fact that unless the amount for one time settlement was finalized by the bank, there was no occasion for us to submit the programme of repayment of the settled amount.

However a period of more than two months had elapsed but no such information was given to us. Instead, after two months, Bank took over the possession of our SSI unit and its guarantor’s assets without giving   any intimation about the fate of our OTS offer.

Bank got the assets valued and in a purported public auction, which was held in their own office, auctioned both the immovable properties, devoid of any public participation, and purchased the same itself. It is pertinent to mention that movable assets remain unsold.

It is pertinent to mention that bank did not deposit the mandatory 25% of the bid amount on bid being confirmed by the Authorised officer as per the SARFAESI Act.

The representatives of workers union were not allowed to attend the auction proceedings except banks own invited guest , reasons known to the bank only.

Further, before confirming the bid in its own favor, bank did not take the consent of the borrowers as per the stipulation laid down in the SARFAESI Act. DRT did not notice the cited facts and dismissed our application.

Astonishingly, Bank confirmed the sale in haste before the expiry of the appeal period i.e. before we could file an appeal in DRAT.

Interestingly, DRAT, did not accept our appeal without pre deposit of 25%. We are at a loss to understand when the bank did not pay 25% of the bid amount how their bid could be accepted in violation of SARFAESI Act. Whereas our appeal was not accepted without deposit of 25%, that too when our entire assets were under the lock and key of the bank and our business was also closed due to of attachment of our unit.

In view of the submitted facts one can find that bank has violated not one but many statutory provisions of the securitization act, and, despite the same they are free to take any action against a borrower, whether legal or illegal .Nobody can challenge the authority of a bank so long they are equipped with a SARFAESI weapon. Being banks they are enjoying the status of trust worthy, where as the integrity of businessmen are subject to doubt.

Under the circumstances one may believe that there is no room for justice for honest borrowers. But, is it not violation of one’s fundamental right to get justice? Is it not that a citizen of this country, who has full trust and confidence in his country’s judiciary, is deprived of his right to get natural  justice.

If one is denied his right to represent his cause how truth can be ascertained. Is not the reason that SARFAESI victims surrender  their appeal uncontested before DRAT as they are unable to pay  to defend their cause.

Through this submission, I draw the kind attention of the esteemed members of lawyers club to put this appeal before various legal forums or so, so that appropriate amendment may be made in SARFAESI act so that bonafide  borrowers need not suffer.

In consideration of the above stated facts kindly advise what action should be taken by the borrower who is unable to make pre-deposit of 25% as well as take his case to the Supreme Court in view of the hefty expenses involved?

Functions of Chief Metropolitan Magistrate /District Magistrate u/s.14 of the Act

The Magistrates perform ministerial functions under Section 14 of SARFAESI Act. Sec.14(3) of the Act provides for immunity. Section 34 of the Act bars civil court’s jurisdiction in order to avoid adjudication of cla im (which is time consuming process) and the jurisdiction to scrutinize the legality of the action is conferred to the DRTs (after the stage of action under Sec.13(4)). For this reason Sec.14 does not confer power to CMM/DM for deciding any dispute of any person. Hence for this reason, service of any notice to the borrower is not contemplated in Sec. 14 of the Act (as no adjudication of dispute takes place before the CMM/DM). It is manifest that Sec 14 confers only ministerial function to the Magistrate which cannot be called in question in any court or before any authority. Sec 14 is procedural in nature and merely empowers the CMM or DM to assist the secured creditor in taking possession of the secured assets and it does not clothe the DM with the power to adjudicate in respect of any dispute pertaining to secured assets:(Union Bank of India Vs State of Maharashtra: 2010 D.R.T.C. 487(Bom); Kotak Mahindra Bank Limited Vs District Magistrate 2011(1) D.R.T.C. 513 (Guj.).A mere request to the Magistrate is sufficient under Sec.14 in taking possession (Sosamma Abraham Vs. The Chief Manager S.B.T. & Ors.: AIR 2008 Ker 136).

The CMM/DM exercises only judicial function which is ministerial in nature. There is difference between the judicial function and adjudication function. This is manifest from sub-Sec.14 (3) of the Act which reads thus:

“No act of the Chief Metropolitan Magistrate or the District Magistrate done in pursuance of this section shall be called in question in any court or before any authority.

The Magistrates enjoy immunity for assisting secured creditor as they are not involved in the adjudication process of any dispute of whatsoever nature of any person. Chief Judicial First Class Magistrate in Non Metropolitan areas can also assist the secured creditor under Sec.14:(Muhammed Ashraf and Anr. Vs. Union of India and Ors. : AIR 2009 Kerala 14); Solaris System (P) Ltd. Vs. Oriental Bank of Commerce IV (2006) BC536 (Kerala High Court)=ILR 2006(2)Kerala 645 Dhanalakshmi Bank Ltd. Vs. Kovai Foods & Beverages III(2007)BC 612(Madras High Court)

Taking symbolic possession under Sec.13(4) r/w Rule 8(1) is not a condition precedent for invoking Sec 14 of SARFAESI Act.  Distinguishing with the view taken by one Division Bench in Noble Kumar Vs. Standard Chartered Bank & Ors. CDJ 2010 MCH 4621, another Division Bench of Madras High Court in Hemabhushan Vs. ICICI Bank Ltd. Ors. : CDJ 2010 MHC 3378 held that, right to invoke Sec.14 of the Act is independent of the provisions of Sec.13(4) and powers of the Magistrate under Sec 14 are only ministerial, non-adjudicatory in nature, final and cannot be called in question in any Court or before any Authority. The Magistrate is required only to verify from the Bank / FI whether notice under Sec 13(2) of the Act is given or not whether the secured assets fall within the jurisdiction of the Magistrate. It is also held that, before invoking Sec.14 it is not necessary to issue notice under Sec.13(4) of the Act. Referring to the judgment of the Supreme Court in United Bank of India Vs. Satyavati Tondon & Ors.: III (2010) Banking Cases 495(SC) the High Court observed that, Supreme Court considered the case where Sec.14 was invoked even before issuance of notice under Sec.13(4). In the said case, demand notice was issued under Sec. 13(2) for recovery of Rs. 23,22,972/-. The party offered to pay 18,00,000/-against the claim amount. The bank was not satisfied with the offer of the borrower and invoked Sec.14 and had taken physical possession of secured asset. Thereafter the bank issued notice under Sec 13(4) to the borrower. Therefore it is clear from the above that, issuance of notice under Sec.13(4) is not a condition precedent to invoke Sec. 14 of the SARFAESI Act.

If possession of secured assets are taken with the assistance of Magistrate it amounts to taking measures in terms of Sec. 13(4) and such action gives raise a chance to invoke Sec. 17 of the Act. Though the order of the Magistrate cannot be called in question before any Court or Authority in view of Sub-Sec.(3) of Sec.14 one can raise the legality and propriety of the  measures of taking possession under Sec.14, in proceedings under Sec.17 of the Act if such measure taken is against the provisions of SARFAESI Act and the Rules framed thereunder Bharatbhai Ramaniklal sata Vs. Collector and Dist Magistrate &  Another : AIR 2010 Guj. 72

No prior notice to borrower before taking possession u/s 13(4) after service of 60 days demand notice or even prior to invocation of Sec.14 of the Act : CDJ 2006 MHC 2702 (In re Sundaram Home Finance Ltd.No notice to the borrower by Magistrate is contemplated under Sec.14 : C.R.Sindhu Vs. State of Kerala &     Ors. :AIR 2008 Ker 65; Indian Overseas Bank Vs. Sri Aravind Steels Ltd. 2009 (1) CTC 341=AIR 2009 Mad.10; The Industrial Investment Corporation Ltd Vs. M/s. Sudarshanam Industries & Ors.: AIR 2009 Mad. 15.No trial / enquiry / adjudication of dispute by Magistrate is contemplated Muhammed Ashraf  and Anr. Vs. Union of India and Ors. : AIR 2009 Kerala 14; Union Bank Of India Vs. State of Maharashtra & Others:2010 (2) DRTC 487 (Bom.). No hearing of borrower or guarantor by the Magistrate is contemplated in the Act Tensile Steel Ltd. & Anr. Vs. Punjab & Sindh Bank & Ors. AIR 2007Guj 126.Metropolitan Magistrate while considering an application under section 14 need not issue any notice to borrower or any person  Aboobacker Vs. PNB & others 2005 (127) CC 519(Kerala); Mrs. Sunanda Kumari and another Vs Standard Chartered Bank (2007) 135Comp. Cas.604(Kar.); Vijaya Bank Vs Shameem Transport: 2007(1)D.R.T.C. 494(Kar.); State Bank of India Vs Kathikkal Tea Plantations, Melur : AIR 2009 Mad.152. It is very much clear that absolutely no power, jurisdiction, competence or expertise is intended or vested with the Magistrate to deal with any claim as to the nature of the property in question or as to the merits or demerits with regard to other aspects involved in connection with loan transaction, but for considering whether the property in question in respect of which assistance is sought is a secured asset or not. For similar proposition refer to Ayishumma Vs. Hassan :AIR 2010 Ker.13; Vaishnavi Pulvarising Mills Ltd Vs. SBI, Stressed Assets Management Branch, Chennai 2010 (1) MLJ (Cri) 31. Where the Additional Collector has similar power as of Collector under Sec 14 A of the UP Land Revenue Act, 1901, the Order passed by the Additional Collector cannot be said to be without jurisdiction Irshad Hussain Vs District Magistrate, Moradabad: AIR 2009 Allahabad 125. Section 20 of Cr.P.C. empowers State Government to appoint an Executive Magistrate as Additional District Magistrate who can also exercise powers under Sec.14 of the SARFAESI Act. Harunali Mallik Vs. State of West Bengal: 2011 (2)   D.R.T.C. 20(Cal.)

In case the Magistrate declines to assist and if the secured creditor wishes to challenge the same, in revision under Art. 227 or under Sec.482 of Cr.P.C., it is not necessary to issue notice to the borrower or the auction purchaser Vijaya Bank Vs. Shameem Transport & Ors.: AIR 2007( NOC) 310 (Kar.).Art. 227 or Sec. 482 Cr.P.C. can be invoked by secured creditor against refusal to give assistance. No notice to the borrower or Auction Purchaser is necessary. There is no statutory requirement to issue any notice prior to issuance of notice under sec.13(4) or before invoking assistance under Sec. 14 of the Act.: Sundaram Home Finance Ltd. Vs. 1.The Tahsildar, Hosur 2. V and the Dist. Collector : CDJ 2006 MHC 2702. Issuing notice to the borrower is alien to the special statute viz. SARFAESI Act since no adjudication nor roving enquiry is contemplated under Sec.14 of SARFAESI Act. (State Bank of India Vs. Kathikkai Tea Plantations & Ors. 2009 (2) DRTC 738 Mad.)It is well settled law that at the stage of Sec 14, there is no adjudication of any issues. The authorities have to only render assistance to the secured creditor to recover possession(Arjun Urban Co-operative Bank Ltd, Sholapur Vs Chief Judicial Magistrate, Solapur 2009(5)MHLJ 380 (Bom)

Seeking assistance u/s 14 is not compulsory. Taking assistance of Chief Metropolitan or District Magistrate under Sec. 14 of the Act is not compulsory: “Invocation of Sec. 14 is not mandatory”.(Aboobacker Vs. Punjab National Bank III (2005) BC 390 Ker). But purpose of taking assistance of the Magistrate is to ensure that, no breach of peace takes place while taking physical possession.

Sec. 14 can be invoked even after issuing Sale Certificate. Prior issuance of sale certificate does not operate as bar for taking assistance of the Magistrate under Sec.14(2) of the Act. Borrower is not entitled to any notice on issuing sale certificate and the bank does not cease to be secured creditor. Shakthi Industries & Others Vs. Indian Overseas Bank 2010(2) DRTC 725 (Mad.)

The Magistrate can appoint Advocate-Commissioner for identification and taking possession of the secured assets if necessary by taking help of police Indian Overseas Bank Vs. Sri Aravind Steels Ltd. 2009 (1) CTC 341=AIR 2009 Mad.10.

The Magistrate has to verify the record to the extent that the condition precedent for exercise of the power by the Bank are satisfied Authorised Officer Canara Bank Vs Sulay Traders thro Bipin Kantilal Vakta 2010 TLGJ 407.

The employment of any physical power to dispossess even in terms of a statute or enforceable order could be only had in exercise of the police power of the State. Even a Court does not have the power to dispossess by force through its officer, but has the power to secure it only through the police machinery of the State. That power cannot be conceded to any individual or institution empowered to take possession, except in cases where the power to physically dispossess is also expressly conferred. That such power has not been conferred by Parliament on a secured creditor under the Act. The DM has to exercise the power by himself and cause the relief to be worked out under his control. That cannot be delegated: Sundaram BNP Paribas Home Finance Ltd Vs State of Kerala AIR 2009 Ker 85.

Invocation of Sec.14 gives scope to invoke Sec.17 of the Act. Kerala High Court in Sami Vs. Bank of India:2011 (3) Bankers’ Journal 293held that, approaching Magistrate under Section 14 itself would constitute a measure under Section 13(4), which would give rise to an aggrieved person to approach DRT. It is not necessary for an aggrieved person to wait till actual or symbolic possession is taken before resorting to the remedy as provided under Section 17 of the Act.  This judgment is affirmed by a three judges Bench (consisting of Chief Justice) of Kerala High Court inPushpangadan Vs. Federal Bank2011 (4) KLT 134 : 2011 (4) KLJ 93).

Territorial jurisdiction to exercise powers under Sec.14 is based on the location (situs) of the secured assets whether movable or immovable

In case the Magistrate declines to assist and if the secured creditor wishes to challenge the same, in revision under Art. 227 or under Sec.482 of Cr.P.C., it is not necessary to issue notice to the borrower or the auction purchaser Vijaya Bank Vs. Shameem Transport & Ors.: AIR 2007( NOC) 310 (Kar.). There is no statutory requirement to issue any notice prior to issuance of notice under sec.13(4) or before invoking assistance under Sec. 14 of the Act.: Sundaram Home Finance Ltd. Vs. 1.The Tahsildar, Hosur 2. V and the Dist. Collector : CDJ 2006 MHC 2702. Issuing notice to the borrower is alien to the special statute viz. SARFAESI Act since no adjudication nor roving enquiry is contemplated under Sec.14 of SARFAESI Act. State Bank of India Vs. Kathikkai Tea Plantations & Ors. 2009 (2) DRTC 738 Mad.It is well settled law that at the stage of Sec 14, there is no adjudication of any issues. The authorities have to only render assistance to the secured creditor to recover possession Arjun Urban Co-operative Bank Ltd, Sholapur Vs Chief Judicial Magistrate, Solapur 2009(5)MHLJ 380 (Bom)

The requests made under Sec.14 have to be disposed of expeditiously else the secured creditor may suffer loss or damages if any to the secured assets on account of delay.

Govt. of India approved a bill to be placed before Parliament during ‘Winter Session’ but the same could not be tabled. However it may be introduced in Monsoon Session. The gist of the amendment is given below:

PROPOSED AMENDMENT  TO Section 14.

Chief Metropolitan Magistrate or District Magistrate to assist secured creditor in taking possession of secured asset

(1) Where the possession of any secured assets is required to be taken by the secured creditor or if any of the secured asset is required to be sold or transferred by the secured creditor under the provisions of this Act, the secured creditor may, for the purpose of taking possession or control of any such secured asset, request, in writing, the Chief Metropolitan Magistrate or the District Magistrate within whose jurisdiction any such secured asset or other documents relating thereto may be situated or found, to take possession thereof, and the Chief Metropolitan Magistrate or, as the case may be, the District Magistrate shall, on such request being made to him–

(a) take possession of such asset and documents relating thereto; and

(b) forward such assets and documents to the secured creditor.

*Provided  that   any  application by  the   secured  creditor   shall  be accompanied by an affidavit duly affirmed by the authorised officer of the secured creditor, declaring that—

(i) the aggregate amount of financial assistance granted and the total claim of the Bank as on the date of filing the application;

(ii) the borrower has created security interest over various properties and that the Bank or Financial Institution is holding a valid and subsisting security interest over such properties and the claim of the Bank or Financial Institution is within the limitation period;

(iii) the borrower has created security interest over various properties giving the details of properties referred to in sub-clause (ii) above;

(iv) the borrower has committed default in repayment of the financial assistance granted aggregating the specified amount;

(v) consequent upon such default in repayment of the financial assistance the account of the borrower has been classified as a nonperforming asset;

(vi) affirming that the period of sixty days notice as required by the provisions of sub-section (2) of section 13, demanding payment of the defaulted financial assistance has been served on the borrower;

(vii) the objection or representation in reply to the notice received from the borrower has been considered by the secured creditor and reasons for non-acceptance of such objection or representation had been communicated to the borrower;

(viii) the borrower has not made any repayment of the financial assistance in spite of the above notice and the Authorised Officer is, therefore, entitled to take possession of the secured assets under the provisions of sub-section (4) of section 13 read with section 14 of the principal Act;

(ix) that the provisions of this Act and the rules made thereunder had been complied with:

Provided further that on receipt of the affidavit from the Authorised Officer, the District Magistrate or the Chief Metropolitan Magistrate, as the case may be, shall after satisfying the contents of the affidavit pass suitable orders for the purpose of taking possession of the secured assets.

Provided also that the requirement of filing affidavit stated in the first proviso shall not apply to proceeding pending before any District Magistrate or the Chief Metropolitan Magistrate, as the case may be, on the date of commencement of this Act.

(1A) The District Magistrate or the Chief Metropolitan Magistrate may authorise any officer subordinate to him,—

(i) to take possession of such assets and documents relating  thereto; and

(ii) to forward such assets and documents to the secured creditor.”;

(2) For the purpose of securing compliance with the provisions of sub-section (1), the Chief Metropolitan Magistrate or the District Magistrate *any officer authorised by the Chief Metropolitan Magistrate or District Magistrate may take or cause to be taken such steps and use, or cause to be used, such force, as may, in his opinion, be necessary.

(3) No act of the Chief Metropolitan Magistrate or the District Magistrate done in pursuance of this section shall be called in question in any court or before any authority.

HOW MANY TYPES OF ADVOCATES ARE THEIR IN INDIAN COURTS

DIFFERENT TYPES OF ADVOCATES IN INDIAN COURTS
What is the difference amongst Senior Advocate, an Advocate on Record and an advocate?
The Advocates Act makes a provision for two kinds of advocates i.e. Senior Advocates and advocates. However, the Supreme Court of India has, in exercise of its rule making power, made a provision for advocate on record. The distinction amongst them are as follows:
(i) SENIOR ADVOCATES
Senior Advocates are designated as such by the Supreme Court of India or by any High Court. The Court can designate any advocate, with his consent, as Senior Advocate if in its opinion by virtue of his ability and standing at the Bar or special knowledge or experience in law, the said advocate is deserving of such distinction. A Senior Advocate is not entitled to appear without an Advocate-on-Record in the Supreme Court or without a junior in any other court or tribunal in India. He is also not entitled to accept instructions to draw pleadings or affidavits, advise on evidence or do any drafting work of an analogous kind in any court or tribunal in India or undertake conveyancing work of any kind whatsoever, but this prohibition shall not extend to settling any such matter as aforesaid in consultation with a junior.
(ii) ADVOCATES-ON-RECORD
Only these advocates are entitled to file any matter or document before the Supreme Court. They can also file an appearance or act for a party in the Supreme Court. No other High Court in India has a similar provision.
(iii) OTHER ADVOCATES
These are advocates whose names are entered on the roll of any State Bar Council maintained under the Advocates Act, 1961 and they can appear and argue any matter on behalf of a party in any court or tribunal. However, in the Supreme Court, they are not entitled to file any document or matter before the Court.

Telecom Services and Consumer Law

Telecom Services and Consumer Law: By Satnam Singh
In a Recent Judgment in an appeal No.7687 of 2004 filed by the BSNL, the Hon’ble Supreme Court of India while deciding/accepting the appeal of BSNL on 1-1-2009, has Has decided that when there is a special remedy provided in section 7-B of the Indiam Telegraph Act regarding disputes in respect of telephone bills, then the remedy under the Consumer Protection Act is by implication barred. The section 7-B of the India Telegraph Act provides for resolution of consumer disputes through arbitration. While circulating this Judgment by the BSNL head quarters, the Branch Offices have been directed to contest the cases on the basis of above said Judgment of the Hon’ble Supreme Court of India.
Now, In a recent Judgment passed by the District Consumer Forum, Ferozepur, Punjab, India recently received in the office of a local Newspaper, District Consumer Disputes Redressal Forum, Ferozepur comprising of Sanjay Garg, President and Tarlok Singh, Member held that a subscriber of telophone/mobile phone connection has a right to approach the Consumer Fora s established under the Consumer Protection Act for the redressal of their grievances as the Consumer Protection Act is a special legislation enacted for the protection of consumer rights.  The facts of the case are that one Lakhbir Singh approached the Consumer Forum at Ferozepur with a complaint that his mobile phone connection has been wrongfully deactivated by the Bharat Sanchar Nigam Limited despite paying the necessary charges and submission of necessary documents.  However, consel for the B.S.N.L. contested the case on the ground that the Consumer Forum has no jurisdiction to entertain a dispute relating to telecommunications services in view of the recent authority of the Supreme Court styled as General Manager, Telecom Versus M. Krishnan and others decided on 1.9.09, which was also published in various news papers.
                   Sanjay Garg, President and member Tarlok Singh of the District Forum Ferozepur after discussing various other authorities of the Supreme Court held that the newly enacted Telecom Regulator Authority of India Act, 1997 is more applicable to the matters relating to telecom disputes than the old Indian Telegraph Act, 1885. The Consumer Forums have been given jurisdiction to adjudicate upon the matters relating to telecom consumer disputes under the said Act of 1997. While holding that the consumer Protection Act is a special legislation and not a general law, Shri Sanjay Garg, President of the Consumer Forum finding the B.S.N.L. deficient in services ordered it to pay a sum of Rs.10,000/- to complainant Lakhbir Singh on account of mental agony, pain and harassment suffered by him and Rs.2000/- as litigation expenses and further ordered to restore the mobile connection of the complainant without charging any extra sum.
A copy of the order of District Consumer Forum, Ferozepur is given/placed below for ready references::
 
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, FEROZEPUR.
 
QUORUM
                                    President                  :           Shri Sanjay Garg
                                    Member                    :           S. Tarlok Singh
                                                                                    C.C. No.180 of 2009
                                                                                    Date of Institution: 9.4.2009
                                                                                    Date of Decision: 11.9.2009
Lakhbir Singh, aged about 34 years, son of Mohinder Singh son of Harnam Singh, resident of Basti Kamboj Nagar, Ferozepur City.
                                                                                                            ……. Complainant
                                                Versus
1.        Aman Arora Telecom, Dulchi Ke Road, Opposite Guruduwara
Market, Basti Kamboj Nagar, Ferozepur City, Tehsil and District
Ferozepur, through its Proprietor Aman Arora.
2.        Bharat Sanchar Nigam Limited, Telecom (Mobile), Ferozepur Cantt,
through its General Manager.
                                                                                                ……… Opposite parties
                                                                        Complaint under Section 12 of the
Consumer Protection Act, 1986.
*          *          *          *          *
P R E S N T :
For the complainant                      :           Complainant in person
For opposite party No.1               :           Sh. Deepak Maggo, Advocate
For opposite party No.2               :           Sh. Gagan Goklany, Advocate
                                                O R D E R
 
SANJAY GARG, PRESIDENT:-
                        Complainant Lakhbir Singh has filed the present complaint against Aman Arora Telecom (herein after referred to as opposite party No.1) and Bharat Sanchar Nigam Limited (herein after referred to as opposite party No.2) pleading that the complainant got a mobile telephone
C.C. No.180 of 2009                     \\2//
connection No.94645-59188 from opposite party No.1 after paying Rs.200/- on 6.2.2009 and at that time the complainant had given his proof of identity i.e. one snap and photo copy of voter card to opposite party No.1. Opposite party No.1 issued a sim card of the above said mobile connection to the complainant and told that the validity of the same would be three months with the value of Rs.100/- talk time. After that the said mobile connection was activated and it was running upto 1.3.2009, but on 2.3.2009, opposite party No.1 disconnected the connection of the complainant. On enquiry, the complainant came to know that his mobile connection has been disconnected for want of identity proof. On 3.3.2009, the complainant again submitted the same proof i.e. one snap and one photo copy of the voter card to the opposite parties and opposite party No.2 promised that the mobile connection in question will be activated again up till evening of the same day. Thereafter, the complainant made several requests to the opposite parties, also served a legal notice dated 28.3.2009 upon the opposite parties regarding the above said negligence and deficiency in service, but the opposite parties have neither paid any heed to the requests of the complaint nor given any reply to the notice. Pleading deficiency in service on the part of the opposite parties, the complainant has claimed Rs.20,000/- as compensation for mental agony, pain and harassment and Rs.2200/- as litigation expenses.
2.                    Notice of the complaint was given to the opposite parties, who appeared and filed their separate written replies to the complaint. Opposite party No.1, in its written reply, has pleaded that the complainant got a
C.C. No.180 of 2009                     \\3//
mobile telephone connection No.94639-59188 from opposite party No.1 on 6.2.2009 and had given his identity proof i.e. one snap and photo copy of voter card and opposite party No.1 issued sim card of the mobile connection and told that as per the norms and conditions of the company, the validity was of three months with talk time worth Rs.100/-. After obtaining the proof required for the connection, the same was forwarded to BSNL for activation of the connection and the said connection was activated. It has been further pleaded that after submission the identity proof, the connection in question was activated by the BSNL and opposite party No.1 has got no role to play thereafter. The verification of the identity proof is done by the company and in case of negative verification, the company can seek the identity proof other than the furnished at the time of getting the connection. Denying any deficiency in service on the part of opposite party No.1, dismissal of the complaint has been prayed for.
3.                    Opposite party No.2, in its written reply, has pleaded that opposite party No.1 is not an authorized agent of opposite party No.2 rather M/s Aneja Enterprises, Jalalabad (W) is the authorized dealer. Prepaid mobile connections are given to consumers after the completion of requisite formalities and the dealer is to activate the same. The sim in question was given to M/s Aneja Enterprises and not to opposite party No.1. It has been further pleaded that the said sim is in working condition. Other allegations of the complaint have been denied.
4.                    Parties led evidence.
C.C. No.180 of 2009                     \\4//
5.                    We have heard the complainant in person and learned counsel for the opposite parties and have also gone through the file.
6.                    At the outset, the learned counsel for opposite party No.2 has produced a recent judgment of the Hon’ble Supreme Court of India styled as General Manager, Telecom Versus M. Krishnan & Another, Civil Appeal No.7687 of 2004, decided on 1.9.2009 and submitted that in view of the above said authority, this Forum has no jurisdiction to entertain and decide the present complaint.
7.                    So before adjudicating the matter on merits, it has become necessary to decide as to whether this Forum, established under the Consumer Protection Act, has jurisdiction to entertain the disputes relating to mobile connections. The Hon’ble Supreme Court of India in the above said judgment has held that under Section 7-B of the Indian Telegraph Act, 1885, the disputes concerning any telegraph line, appliance or apparatus are required to be referred to an Arbitrator appointed by the Central Government. Relying upon another authority of the Hon’ble Supreme Court styled as “Chairman, Thiruvalluvar Transport Corporation Versus Consumer Protection Council, (1995) 2 SCC 479”, the Hon’ble Supreme Court of India has further held that special law overrides the general law.
8.                    In full respect to the Hon’ble Supreme Court of India, before relying upon the above said authority, we would like to discuss another law/legislature enactments made by the Parliament and also the various other authorities on the question relating to the jurisdiction of the Consumer Forums.
C.C. No.180 of 2009                     \\5//
9.                    So far the provisions of The Indian Telegraph Act, 1885 are concerned, under Section 3 (1AA), the word ‘Telegraph’ has been defined as under :-
                        “telegraph” means any appliance, instrument, material
                        or apparatus used or capable of use for transmission or
                        reception of signs, signals, writing, images, and sounds
                        or intelligence of any nature by wire, visual or other electro-
                        magnetic emissions, Radio waves or Hertzian waves, galvanic,
                        Explanation – “Radio waves” or “Hertzian waves” means
                        electro magnetic waves of frequencies lower than 3,000
                        giga-cycles per second propagated in space without artificial
                        guide.”
10.                  The instrument named telephone, through which one person could directly talk with another person at a distant place without seeing personally face to face, was invented by Alexander Graham Bell in the year 1876. In 1878, the first telephone exchange was established at New Haven. In the year 1882, first telephone exchange was opened at Calcutta in India having only 93 subscribers. In the year 1885, when the Indian Telegraph Act was enacted, telephone facility was not available to the people at large in India. Through telegraph system, certain messages were used to be conveyed through signs, signals and sounds etc. Even the facility was not available to people at large, but was used in emergency cases through the specialized facility offered by the Government authorities. With the advancement of
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technology, new inventions were made and landline telephone services were made available to the consumers at large. Thereafter, mobile telephone technology stepped into to serve the people and it was indeed a revolution in the field of telecommunication.
11.                  Section 3 (1AA), as reproduced above, was introduced in the said Act in the year 1961 by way of amendment to the parent Act of 1885. In the year 1961, the mobile technology had not been developed in India. Mobile phones were formally launched in India in August, 1995. With the advancement of the technology, the facility of phones reached to the consumers at large. With the changed circumstances, the law relating to telecommunication has also been changed and it must be changed with the changed circumstances, otherwise the legal system would fall flat and the people would become violators of law.
12.                  Several mobile service providers have been granted licenses to provide mobile telephone services to the consumers. To regulate the telecommunication services, adjudicate disputes, dispose of appeals and to protect the interest of service providers and consumers of the telecom sector and for matters connected therewith, the Parliament has passed “The Telecom Regulatory Authority of India Act, 1997”. Under the Telecom Regulatory Authority of India Act, 1997, the ‘telecommunication services’ have been defined, which for the purpose of facilitation is reproduced as under :-
                        “2.      Definitions.-(1) In this Act, unless the context otherwise
                                  requires -
(k)       “telecommunication service” means service of any
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                                    description (including electronic mail, voice mail,
                                    data services, audio tax services, video tax services,
                                    radio paging and cellular mobile telephone services)
                                    which is made available to users by means of any
                                    transmission or reception of signs, signals, writing,
                                    images and sounds or intelligence of any nature, by
                                    wire, radio, visual or other electromagnetic means
                                    but shall not include broadcasting services:
                                                Provided that the Central Government may
                                    notify other service to be telecommunication service
                                    including broadcasting services.”
13.                  Under the said Telecom Regulatory Authority of India Act, 1997, a provision has been made for establishment or incorporation of an authority namely Telecom Regulatory Authority of India to regulate the functioning of telecommunication service providers and other matters including and relating to mobile telephones also. Under Section 14 of the said Act, a provision has been made for establishment of Appellate Tribunals to adjudicate any dispute relating to the telecommunication services. For the purpose of facilitation, Section 14 of the Telecom Regulatory Authority of India Act, 1997 is reproduced as under :-
                        “14. Establishment of Appellate Tribunal – The Central
                        Government shall, by notification, establish an Appellate
                        Tribunal to be known as the Telecom Disputes Settlement
                        and Appellate Tribunal to –
(a)              adjudicate any dispute –
(i)                between a licensor and a licensee;
(ii)              between two or more service providers;
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(iii)            between a service provider and a group of
consumers:
Provided that nothing in this clause shall apply
in respect of matters relating to -
(A)      the monopolistic trade practice, restrictive trade
practice and unfair trade practice which are subject
to the jurisdiction of the Monopolies and
Restrictive Trade Practices Commission established under sub-section (1) of Section 5 of
the Monopolies and Restrictive Trade Practices Act, 1969 (54 of 1969);
(B)      the complaint of an individual consumer
maintainable before a Consumer Disputes Redressal Forum or a Consumer Disputes Redressal Commission or the National Consumer Redressal Commission established under section 9 of the Consumer Protection Act, 1986 (68 of 1986);
(C)             dispute between telegraph authority and any other
person referred to in sub-section (1) of section 7B
of the Indian Telegraph Act, 1885 (13 of 1885)”.
14.                  From the bare perusal of the above said provisions, now it is clear beyond doubt that the telephone services and to be more particular
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Cellular mobile telephone services have been specifically covered under the Telecom Regulatory Authority of India Act, 1997 and the provisions of the said Act are in addition to the previous Indian Telegraph Act, 1885. From perusal of Section 14 (b), it is very much clear that even when a consumer approaches the Consumer Disputes Redressal Forum, then the provisions of the Telecom Regulatory Authority of India Act, 1997 or the jurisdiction of the Appellate Tribunals established under the Telecom Regulatory Authority of India Act, 1997 ceases, rather the provisions of the Consumer Protection Act get precedence over the powers vested with the Appellate Tribunals established under the Telecom Regulatory Authority of India Act, 1997.
15.                  The Telecom Consumers Protection and Redressal of Grievances Regulations, 2007 have come into force vide Notification dated 4th May 2007 and have been published in Gazette of India. Under Regulation No.1 Clause (3), it has been provided that these regulations shall apply to –
                        “(a)     all service providers including Bharat Sanchar Nigam
                                    Limited and Mahanagar Telephone Nigam Limited,
                                    being the companies registered under the Companies
                                    Act, 1956 (1 of 1956) providing –
                        (i)        Basic Telephone Service;
                        (ii)       Unified Access Services;
                        (iii)      Cellular Mobile Telephone Service.”
The ‘Basic Telephone Service’ has been defined under Section 2 (g) of the above said Regulations. The meaning of ‘consumer’ has also been defined.
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For the sake of convenience, Section 2 (d), 2 (g) and 2 (h) of the above said Regulations are reproduced as under :-
                        “2.      Definitions – In these regulations, unless the context
            otherwise requires -
                        (d)       “Basic Telephone Service” covers collection, carriage,
                                    transmission and delivery of voice or non-voice
                                    messages over licensee’s Public Switched Telephone
                                    Network in licensed service area and includes provision
                                    of all types of services except those requiring a separate
                                    licence;
                        (g)       “Cellular Mobile Telephone Service” -
(i)        means telecommunication service provided by means
of a telecommunication system for the conveyance of messages through the agency of wireless telegraphy
where every message that is conveyed thereby has been,
or is to be, conveyed by means of a telecommunication
system which is designed or adapted to be capable of
being used while in motion;
(ii)       refers to transmission of voice or non-voice messages
over Licensee’s Network in real time only but service
does not cover broadcasting of any messages, voice or
non-voice, however, Cell Broadcast is permitted only to
the subscribers of the service,
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(iii)      in respect of which the subscriber (all types, pre-paid as
well as post-paid) has to be registered and authenticated
at the network point of registration and approved numbering plan shall be applicable;
(h)             “consumer” means a consumer of a service provider
falling in clause (a) or clause (b) of sub-regulation (3) of
                                    regulation 1 and includes its customer and subscriber.”
16.                  Section 25 of the above said Regulations is very much relevant, which for the sake of convenience is reproduced as under :-
                        “25.    Right of consumers to seek redressal under
the Consumer Protection Act, 1986 or any other
law for the time being in force – (1) The provisions
of these regulations are in addition to any right
conferred upon the consumers under the Consumer
Protection Act, 1986 (68 of 1986) or any other law
for the time being in force.
                        (2)       Any consumer may, at any time -
                        (a)       during pendency of redressal of his grievance, whether
by filing of complaint or appeal, under these regulations;
or
                        (b)       before or after filing of complaint or appeal, under these
                                    regulations, exercise his right conferred upon him under
the Consumer Protection Act, 1986 (68 of 1986) or any
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other law for the time being in force and seek redressal
                                    of his grievance under that Act or law.”
17.                  Section 27 of the above said Regulations is also very much important, which for the sake of convenience is reproduced as under:-
                        “27.    These regulations not to apply in certain cases –
                                    Nothing contained in these regulations shall apply to
                                    any matter or issue for which –
(a)              any proceedings, before any court or tribunal or
under the Consumer Protection Act, 1986 (68 of
1986) or any other law for the time being in force,
are pending; or
(b)             a decree, award or an order has already been
passed  by any competent court or tribunal or
authority or forum or commission, as the case
may be.”
18.                  From the bare perusal of the above said Regulations framed by the Telecom Regulatory Authority of India exercising the powers conferred upon it under Section 36 and Section 11 of the Telecom Regulatory Authority of India Act, 1997, it is abundantly clear that the provisions of the Consumer Protection Act, 1986 prevail over the Telecom Regulatory Authority of India Act, 1997 and the jurisdiction and powers of the Consumer Disputes Redressal Forums are over and above the jurisdiction and powers of the Tribunals established for the purpose of adjudication of disputes relating to telecommunication services.
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19.                  It is settled law that the law enacted by the Parliament cannot be changed or made useless by judicial interpretation. The provisions of the enactments have to prevail over the judicial decisions. The question of interpretation comes only when the provisions of legislative enactments are either not clear, ambiguous or cannot depict the true meaning. When the provisions of the legislative enactments are plain, clear and unambiguous, then these cannot be negtivated through judicial interpretation. Reliance can be placed upon various authorities of the Hon’ble Supreme Court of India on this point. The Hon’ble Supreme Court in “State of U.P. & Others Versus Jeet S. Bisht & Anr., 2007 (3) CLT 10”, wherein the Hon’ble Supreme Court has specifically held that court cannot add or substitute word in a statute. By judicial verdict the court cannot amend the law made by the Parliament or State Legislature. It has been further held by the Hon’ble Supreme Court in the said authority that mere a direction of the Hon’ble Supreme Court without laying down any principle of law is not a precedent. It is only where the Hon’ble Supreme Court lays down a principle of law that will amount to a precedent. The courts are subordinate to law and not above the law.
20.                  So far the question as to whether the Consumer Protection Act, 1986 is a special legislation or a general law, the Hon’ble Supreme Court of India has given its view in various authorities, some of which we will discuss hereinafter. However, before discussing the authorities, we would like to discuss certain provisions of the Consumer Protection Act, 1986.
                        “1.      Short title, extent, commencement and application –
                        (1)       This Act may be called the Consumer Protection Act,
                                    1986.
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                        (4)       Save as otherwise expressly provided by the Central
                                    Government by notification, this Act shall apply to all
                                    goods and services.
                        2.        Definitions – (1) In this Act, unless the context otherwise
                                    Requires –
 (o)      “service” means service of any description which is made
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 under a contract of personal service.
                        3.        Act not in derogation of any other law –The
provisionsof thisAct shall be in addition to and not
in derogation of the provisions of any other law for the
time being in force”.
21.                  So from the perusal of the above said provisions of the Consumer Protection Act, 1986, it is quite clear that the provisions of the Consumer Protection Act, 1986 apply to all type of goods and all services availed by the consumers against consideration paid or promised. Section 1 (iv) of the Consumer Protection Act, 1986 is of wide connotation.
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22.                  The Hon’ble Supreme Court of India in “Secretary, Thirumurugan Co-operative Agricultural Credit Society Versus M. Lalitha (Dead) through LRs. and others, 2004 (1) CLT 456”,wherein an objection was raised as to the jurisdiction of the Consumer Disputes Redressal agencies in view of the bar/arbitration clause contained in Section 90 and Section 156 of the Tamil Nadu Co-operative Societies Act, 1983, the Hon’ble Supreme Court of India has held that merely because the rights and liabilities are created to the appellate society under the Co-operative Societies Act, 1983 and Forums are provided for adjudicating the dispute between them, it cannot take away or exclude the jurisdiction conferred on Forum under the Consumer Protection Act, 1986 expressly and intentionally to serve a definite cause in terms of the objects and reasons of the Act. The Hon’ble National Commission was held right in holding that the view taken by the Hon’ble State Commission that the provisions under 1983 Act relating to reference of disputes to arbitration shall prevail over the provisions of 1986 Act, is incorrect and untenable. The authority Chairman, Thiruvalluvar Transport Corporation Versus Consumer Protection Council, (1995) 2 SCC 479, relied upon in the authority General Manager, Telecom Versus M. Krishnan & Another (supra), has been discussed and distinguished by the Hon’ble Supreme Court in the above said authority. The Hon’ble Supreme Court in para 11 and 12 of the judgment has observed as under :-
“(11)           From the statement of objects and reasons
and the scheme of 1986 Act, it is apparent that the main
objective of the Act is to provide for better protection of
the interest of the consumer and for that purpose to
provide for better redressal mechanism through which
cheaper, easier, expeditious and effective redressal is
made available to consumers. To serve the purpose of
the Act, various quasi judicial forums are set up at the
district, State and National level with wide range of
powers vested in them. These quasi judicial forums,
observing the principles of natural justice, are
empowered to give relief of a specific nature and to
award, wherever ‘appropriate, compensation to the
consumers and to impose penalties for non-compliance
of their orders.
(12)                As per Section 3 of the Act, as already
stated above, the provisions of the Act shall be in
addition to and not in derogation to any other provisions
of any other law for the time being in force. Having due
regard to the scheme of the Act and purpose sought to
be achieved to protect the interest of the consumers,
better the provisions are to be interpreted broadly,
positively and purposefully in the context of the present
case to give meaning to additional/extended jurisdiction,
particularly when Section 3 seeks to provide remedy under
the Act in addition to other remedies provided under other
Acts unless there is clear bar”.
So as per the above said authority, despite provisions for referring the dispute to arbitration in the certain Acts/Laws, the object and purpose of the Consumer Protection Act cannot be frustrated as the provisions of the Consumer Protection Act are in addition and not in derogation of any other law in force.
                        It was further held by the Hon’ble Supreme Court that if parties approach both the Forums created under any other Act and the 1986 Act (Consumer Protection Act, 1986), it is for the Forum under the 1986 Act to leave the parties either to proceed or avail the remedies before the other Forums depending upon the facts and circumstances of the case.
23.                  The Hon’ble Supreme Court of India in “Neeraj Munjal and Others Versus Atul Grover (Minor) and another, 2005 (3) CLT 30”, in para 10 and 11 of the judgment has held that the courts could not deprive the parties from a remedy, which is otherwise available to them in law. It has been further held that a court of law has no jurisdiction to direct a matter to be governed by one statute when provisions of another statute are available. 24.                    In“State of U.P. & Others Versus Jeet S. Bisht & Anr., 2007 (3) CLT 10” (supra), the Hon’ble Supreme Court has held that the Consumer Protection Act, 1986 has been enacted for better protection of the interest of the consumers. The said Act is in addition to and not in derogation of the provisions of the any other law for the time being in force.
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The Act not only provides for new rights for the citizens of India in their capacity as consumers, it envisages their empowerment in this behalf. It is indisputably the solemn duty of the executive of both the Government of India and also the Government of State to implement the provisions of the Act in true letter and spirit. The Hon’ble Supreme Court in the above said authority has further held that the Consumer Protection Act embodies a certain value in protecting the interest of the consumers in the age of consumerism and the institution of consumer Fora is a specific mission in that behalf.
25.                  In “State of Karnataka Versus Vishwahharathi House Building Coop. Society and others, 2003 (2) CLT 3”,where the constitutionality of the Consumer Protection Act, 1986 was challenged on various grounds, the three Judges Bench of the Hon’ble Supreme Court of India has held that the provisions of the Consumer Protection Act clearly demonstrate that it was enacted keeping in view a long felt necessity of protecting the common man from wrongs where for the ordinary law for all intent and purport had become illusory. In terms of the said Act, a consumer is entitled to participate in the proceedings directly as a result whereof his helplessness against a powerful business house may be taken care of. The Hon’ble Supreme Court of India further held that by reason of the said statute (Consumer Protection Act), quasi-judicial authorities have been created at the District, State and Central levels so as to enable a consumer to ventilate his grievances before a Forum where justice can be done without
C.C. No.180 of 2009                     \\19//
any procedural wrangles and hyper-technicalities. One of the objects of the said Act is to provide momentum to the consumer movement. While referring to the several provisions of the Consumer Protection Act and also discussing the various authorities, the Hon’ble three Judges Bench of the Supreme Court of India further held that by reason of provisions of Section 3 of the Act, the said Act supplements and not supplants the jurisdiction of the civil court or other statutory authorities. The Hon’ble Supreme Court of India while relying upon another authorities styled as “Fair Air Engineers Versus N.K. Modi, (1996) 6 SCC 385” and “Satpal Mohindra Versus Surindra Timber Stores, (1999) 5 SCC 696” has specifically held that the provisions of the said Act are required to be interpreted as broadly as possible. It has jurisdiction to entertain a complaint despite the fact that other Forum/courts would also have jurisdiction to adjudicate upon the matter.
26.                  The Hon’ble Supreme Court of India in “Ghaziabad Development Authority Versus Balbir Singh, 2004 (2) CLT 628”, has held that the Consumer Protection Act has a wide reach and the Commission has jurisdiction in case of services referred by the statutory and public authorities. The provisions of the Consumer Protection Act enable a consumer to claim and empower the Commission to redress any injustice done. The Hon’ble Supreme Court in the said authority further held that matters, which require immediate attention, should not be allowed to linger on. The consumer must not be made to run from pillar to post. Where there
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has been capricious or arbitrary or negligent exercise or non-exercise of power by an officer of the authority, the Commission/Forum has a statutory obligation to award compensation.
27.                  In Kishore Lal Versus Chairman, Employees’ State Insurance Corporation, 2007 (4) SCC 579the Hon’ble Apex Court has observed :-
                        “It has been held in numerous cases of this Court that
jurisdiction of the Consumer Fora has to be construed
liberally so as to bring many cases under it for their speedy    disposal. The Act being a beneficial legislation, it should receive a liberal construction.”
28.                  The Hon’ble Supreme Court in “Fair Air Engineers Pvt. Ltd. & ANR. Versus N.K. Modi, III (1996) CPJ 1 (SC)” has held :-
                        “Accordingly, it must be held that the provisions of the Act
                        are to be construed widely to give effect to the object and
                        purpose of the Act. It is seen that Section 3 envisages that
                        the provisions of the Act are in addition to and are not in
                        derogation of any other law in force. It is true, as rightly
contended by Mr. Suri, that the words “in derogation of
the provisions of any other law for the time being in force”
would be given proper meaning and effect and if the
complaint is not stayed and the parties are not relegated to
the arbitration, the Act purports to operate in derogation of
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the provisions of the Arbitration Act. Prima facie, the
contention appears to be plausible but on construction and
conspectus of the provisions of the Act we think that the
contention is not well founded. The Parliament is aware of
the provisions of the Arbitration Act and the Contract Act
and the consequential remedy available under Section 9 of
the Code of Civil Procedure i.e. to avail of right of civil
action in a competent Court of civil jurisdiction. Nonetheless,
the Act provides the additional remedy”.
The Hon’ble Supreme Court has further held that in view of the object of the Act and by operation of Section 3 thereof, it would be appropriate that these Forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that the Act intends to relieve all the consumers of the cumbersome arbitration proceedings or civil action unless the Forums at their own and on the peculiar facts and circumstances of a particular case, come to the conclusion that the appropriate Forum for adjudication of the disputes would be otherwise those given in the Act.
29.                  The Hon’ble Supreme Court of India in “Lucknow Development Authority Versus M.K. Gupta, 1994 (1) CLT 1” has observed that a legislation which is enacted to protect public interest from undesirable activities cannot be construed in such narrow manner as to
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frustrate its objective. It has been further observed in the said authority that any attempt to exclude services offered by statutory or official bodies to the common man would be against the provisions of the Act and spirit behind it. The Hon’ble Supreme Court of India has further observed that truly speaking it would be a service to the society if such bodies instead of claiming exclusion subject themselves to the Act and let their acts and omissions scrutinized, as public accountability is necessary for healthy growth of society.
30.                  In “General Manager, Telecom Versus M. Krishnan & Others” (supra), the Hon’ble Supreme Court has held that the special law prevails over the general law. But the point whether the Consumer Protection Act is a special enactment or a general law has not been discussed. On the other hand, in view of the other judgments, reference of which has been given above, the Hon’ble Supreme Court has declared the Consumer Protection Act as a special legislation.
Time and again it has been held by the Hon’ble Apex Court of
country that where a law is declared after thorough discussion, only then it is held as a binding precedent and not otherwise.
                        His Lordship Markandey Katuj, J. in “State of U.P. Versus Jeet S. Bisht” (supra), in para No.66 and 67 of the judgment has observed as under :-
                        “66.    It is well settled that a mere direction of the
                                    Supreme Court without laying down any principle
            C.C. No.180 of 2009                     \\23//
                                    of law is not a precedent. It is only where the Supreme
                                    Court lays down a principle of law that it will amount
to a precedent.
67.      In Municipal Committee, Amritsar Vs. Hazara
                                    Singh, AIR 1975 SC 1087, the Supreme Court
                                    observed that only a statement of law in a decision
                                    is binding. In State of Punjab Vs. Baldev Singh,
                                    1999 (6) SCC 172, this Court observed that
                                    everything in a decision is not a precedent. InDelhi
                                    Administration Vs. Manoharlal, AIR 2002 SC 3088,
                                    the Supreme Court observed that a mere direction
                                    without laying down any principle of law is not a
                                    precedent. In Divisional Controller, KSRTC vs.
Mahadeva Shetty, 2003 (7) SCC 197, this Court
observed as follows:
                                                “….. The decision ordinarily is a decision on
                                    the case before the Court, while the principle underlying
                                    the decision would be binding as a precedent in a case
                                    which comes up for decision subsequently. The scope
                                    and authority of a precedent should never be expanded
                                    unnecessarily beyond the needs of a given situation. The
                                    only thing binding as an authority upon a subsequent
                                    judge is the principle, upon which the case was
decided…..”.”
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31.                  The Hon’ble National Commission in “Union of India and Others Versus Jagdamba Rice Mills, 1993 (1) CLT 705, while discussing Section 7-B of the Indian Telegraph Act and referring to the authority styled as Santokh Singh Versus Divisional Engineer Telephones, Shilong, AIR 1990 Ghuwahati 47, has observed that the Government of India has itself taken a policy decision to the effect that all the requests and reference to Arbitration under the Indian Telegraph Act shall be rejected and Arbitrator shall be appointed only in such cases where subscriber approaches a court with a request for arbitration and court orders for the same. So when the Government of India to be more specific Telecom Authority itself is not willing to refer the dispute concerning the telegraph apparatus etc. to the Arbitrator except upon the orders of the court, then it does not behoove to the opposite parties to raise an objection under Section 7-B of the Telegraph Act.
32.                  Now, it is also a settled law that where two interpretations of statute/law are possible, then the one favouring the consumer is to be taken. Moreover, in case of petty consumer disputes, to direct a poor consumer to approach the Central Government for appointment of an Arbitrator for the adjudication of his small dispute, would be just the denial of justice to him especially when the legislature has enacted a consumer friendly legislation for better protection of the consumer rights and the remedy is available at the door step of the consumer as the District Consumer Forums have been established at every District head quarter of a State.
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33.                  The Consumer Forum established under the Consumer Protection Act, 1986 does not exercise jurisdiction upon each and every matter, rather the jurisdiction of the Consumer Forum can be invoked only on the matters/disputes where the consumer element is involved. So when a dispute where the rights of the consumers are to be adjudicated there only the consumer courts, specially enacted for the said purpose, have the jurisdiction and all other Forums fall subordinate to it. It is now clear that the Consumer Protection law is not a general law, but a special law enacted for the better protection of the interests of the consumers. Where there is a deficiency in service and unfair trade practice, the provisions of the Consumer Protection Act, 1986 can be invoked irrespective of any other statute dealing with the same matter. The remedy under the Consumer Protection Act is an additional and special remedy. Moreover, even as per the provisions of the Telecom Regulatory Authority of India Act, 1997, the provisions of the Consumer Protection Act, 1986 prevail upon the other provisions/enactments relating to telecommunication. So we hold that the Fora established under the Consumer Protection Act has jurisdiction to entertain the matter concerning the disputes relating to telecommunications.
34.                  Now coming to the merits of the case, the connection of the complainant was disconnected without any notice. However, opposite party No.1, who is the dealer, has pleaded that he has no role to play in the disconnection of the connection of the complainant after the activation of the same. The disconnection, if any, has been done by opposite party No.2. Opposite party No.2 i.e. Bharat Sanchar Nigam Limited, who is the telecom
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service provider, has pleaded that infact the connection is working and it was Charged/extended for validity in last month. However, no reason has been given as to why the connection of the complainant was disconnected. After the filing of the present complaint, opposite party No.2 has restored the services, but without any intimation to the complainant and the complainant could not use the said connection because he was under the impression that his sim is not working. The complainant has definitely suffered loss and harassment at the hands of opposite party No.2. Opposite party No.2 has failed to give any explanation for the deficiency in service on their part. Opposite party No.2 is thus grossly deficient in service and is liable to be burdened with exemplary costs. In view of this, this complaint is allowed and opposite party No.2 is directed to activate the connection of the complainant for a period of another three months with due intimation to the complainant without charging any extra sum for the same. Opposite party No.2 is further directed to pay a sum of Rs.10,000/- to the complainant for the loss and harassment suffered by him. Opposite party No.2 is further directed to pay a sum of Rs.2000/- as litigation expenses to the complainant. The orders be complied with within a period of thirty days from the date of receipt of its copy. File be consigned to the record room.