ORDER
R.L. Sudhir, Member
1. The above listed Unfair Trade Practices Enquiry No. 47/ 89 and the Compensation Application No. 237/ 96 are connected matters arising from the same cause of action. The facts and points of law involved in both the cases are also identical, they shall, therefore, be disposed of by a common order.
2. Based on the complaint of M/s. Somaiya Organics India Ltd., the Director General (Investigation and Registration) [the DG in short] investigated the allegations made in aforesaid complaint and filed a Preliminary Investigation Report (PIR) dated 23.4.1991.
3. It has been stated in the PIR that the respondent, namely, M/s. Thermax Private Limited, Chinchwad, Pune, supplied two boilers to M/s. Somaiya Organics India Ltd. in 1987. These boilers were allegedly old and rusted. It is further alleged that the boilers suffered innumerable breakdowns and operated way below the required efficiency levels and never generated the contractually stipulated steam pressure. As a result, the applicant/ informant suffered enormous losses. Although there was a warranty given for a period of 12 months, the respondent failed to rectify the aforesaid defects. In his PIR, the DG has concluded that because of the aforesaid deficiencies, the respondent is liable to be charged with unfair trade practices within the meaning of Sections 36-A(1)(i), (iii), (iv), (vi), (vii) and (viii) of the Monopolies and Restrictive Trade Practices Act, 1969 (the MRTP Act for brief). The DG has further pleaded that it is a fit case for issuance of a Notice of Enquiry (NOE).
4. A prima facie case having been made out against the respondent, a ‘NOE was issued to the respondent on 7.6.1991. In the NOE, it has been inter alia stated that the two boilers supplied by the respondent suffered from the following defects :
“1. One of the boilers supplied to the complainant was an old and rusty manufactured in 1985 i.e. about two years prior to the supply of the same to the complainant.
2. In course of trials, the complainant realised that the boilers required several modifications, as many manufacturing and other defects came to its notice.”
5. Subsequently, on 15.4.1996 the applicant/informant filed a compensation application which was registered as C.A. No. 237/96. The said application has also been considered along with the main complaint petition.
6. The respondent filed reply to the NOE in which the allegations made by the DG and the complainant have been denied and it has been stated that the boilers supplied to M/s. Somaiya Organics India Ltd. were manufactured keeping in view the customer’s requirements. It is further stated that in every scientifically designed equipment, certain standard inputs are required for achieving optimum efficiency and output and that the applicant/informant failed to achieve the optimum efficiency and output because of poor quality of coal used. It has also been explained that the respondent duly attended to complaints of the applicant/informant and to overcome the problems arising due to poor quality of coal available also appropriate ways and means were suggested.
7. After completion of pleadings, the following issues were framed in UTPE 47/89 :
(1) Whether the respondent has indulged in any of the unfair trade practices as stated in the Notice of Enquiry ?
(2) If answer to Issue No. 1 is in affirmative, whether such unfair trade practices are prejudicial to public interest, or interest of the consumer or consumers generally.
(3) Relief.
8. The respondent filed its reply to the compensation application also and after completion of pleadings, the following issues were framed :
(1) Whether the compensation application is maintainable including the Limitation ?
(2) Whether the respondent has indulged in unfair trade practices as alleged in the petition ?
(3) Whether the said trade practices are prejudicial to consumer, consumers generally or to public interest ?
(4) Whether the applicant has suffered any loss due to the above ?
(5) Compensation or relief as claimed if any ?
Thereafter the parties filed their respective affidavits of evidence and also led oral evidence which is on record.
9. The evidence filed in UTPE No. 47/89 was treated as evidence in C.A. 237/96 also and arguments in both the cases were heard on 22.11.2002. The learned Counsel for the parties also filed their written submissions, which have been taken on record.
10. The main contentions of the learned Counsel for the DG and the learned Counsel for the applicant/informant are, firstly, that the boilers supplied were not new and secondly, they had manufacturing defects as a result of which, the contractual parameters of efficiency were not obtained. It has been argued that the aforesaid deficiencies in service render the respondent liable for action under Sections 36(A)(i), (iii), (iv)/ (vi), (vii) and (viii) of the MRTP Act. Learned Counsel for the applicant/ informant additionally pleaded that because of frequent breakdowns and shortfall in efficiency, the applicant/informant suffered financial loss for which, it deserves to be compensated. Learned Counsel for the DG and the applicant/ informant, referred to the ruling of the National Consumer Disputes Redressal Commission, New Delhi in The Roha-Ashtami Cooperative Urban Bank Ltd. v. Nissar Usman Vernnkar and Anr., reported in III (1997) CPJ 1 (NC) in this regard.
11. Learned counsel for the respondent contended that the boilers were made as per requirements of the applicant/informant and that there were no manufacturing defects. It is further stated that during the warranty period, the respondent gave all possible assistance and guidance to the applicant/informant and the boilers gave performance as per contractual parameters. In this connection, our attention has been especially drawn to the statement of Shri B.M.M. Lal, the witness of the applicant/informant, who has stated that the boilers gave satisfactory performance. Para 3 of the affidavit and the letter dated 12.3.1990 were also referred to in this regard. It has been argued that for achieving optimum output prescribed inputs are required which the applicant/informant failed to provide. It was further contended that the quality of coal used by the applicant/informant was not of the required standard although the applicant/informant was fully aware of the same. However, to get over this difficulty, the respondent supplied Travagrate Stoker to the applicant/informant. It was also pleaded that detailed instructions about the use of the boilers were contained in the manual which was delivered to the applicant/informant well before the boilers were installed and commissioned. In this manual, the specifications of coal to be used have been clearly given. As regards the allegation that the boilers were old and rusted, it has been pleaded that no evidence has been led in support of this allegation. It was further submitted that it takes about 6-8 months to manufacture and assemble a boiler and that under the Indian Boilers Act, 1923 read with the Indian Boilers Regulations, 1950, which govern the manufacture and sale of boilers, every part/ component of the boilers is tested and certified. Learned Counsel further added that there were no complaints of any kind during the trial runs, nor thereafter during the running of the boilers. The boilers were commissioned in August, 1987 and they were stated to be running properly. It was in May, 1988 that due to over-heating of the boilers and due to the negligence of the applicant/informant, the tubes in one of the boilers burst. It has been submitted that although the respondent was not obliged to replace the tubes because they burst on account of over-heating, yet as a gesture of goodwill, the respondent replaced all the tubes free of cost. Similarly, the crack in the rear-end plate occurred in 1990 i.e. three years after the installation and commissioning of the boiler.
12. It has been further contended that the applicant/informant used single sieved coal as opposed to the double sieved coal required for running the boilers, despite clear instructions given in the Manuals. The said Manuals specify the size of coal to be used. It was, therefore, concluded that the applicant/informant itself was responsible for the difficulties it came to encounter. It was further submitted that the rulings cited by the learned Counsel for the DG and the applicant/informant are not applicable to the instant case. It is the ruling contained in the Mahna’s case which was decided by the Full Bench of the MRTP Commission that holds the key to the present dispute.
13. Learned Counsel for the respondent further contended that the compensation claim of the applicant/informant was unwarranted because the respondent, in its view, was not at all guilty of having indulged in any unfair trade practice. Further, the compensation application was grossly time-barred as it was filed by the applicant/informant on 15.4.1996 whereas the complaint petition (UTPE 47/89) which arose from the same cause of action was filed on 23.2.1989. Learned Counsel for the respondent referred to the following rulings in support of his contentions :
(1) G.S. Mathur v. Kelvinator India Ltd., reported in 2001 CTJ 59 (MRTP).
(2) Haryana Flour Mills Pvt. Ltd. v.
Haryana State Industrial
Development Corporation,
Chandigarh, reported in 2001 CTJ 140
(MRTP).
(3) Rajender Jaina Tower Pvt. Ltd. v. Lloyd Sales Corporation, reported in 2000 CTJ 439 (MRTP).
(4) K.K. Savjani v. Madhubhai Rathod, Proprietor of Remica Plastics,
reported in 2000 CTJ 277 (MRTP).
(5) V.P. Mahna, etc. v. Bharat Television, New Delhi, etc., reported in (1994) 1 Comp. LJ 496 (MRTP) (FB).
14. We have carefully considered the submissions made by the learned Counsel for the parties and have also evaluated the evidence led by them. There is no evidence on record to show that the boilers in question were old and rusted as contended by the applicant/informant and the DG. Further there is quite some substance in the submission of the respondent that it takes a few months to manufacture a boiler and, therefore, it will be unrealistic to expect the shine of a brand new piece of steel on the surface of a boiler. As regards the quality of boilers, there is merit in the submission of the respondent that under the provisions of the Indian Boilers Act, 1923 read with the Indian Boilers Regulations, 1950, every part or component that goes into the manufacture of boilers is tested and certified. This being so, it is difficult to accept the contention of the DG and the applicant that the boilers were substandard and that they suffered from, manufacturing defects. The respondent having rendered all possible assistance and guidance to the applicant/informant during the warranty period and even, thereafter, we do not find any deficiency in the service on the part of the respondent. Root-cause of the problems/ complaints regarding output and efficiency of the boilers appears to be non-compliance of Instructions given in the Manuals particularly those regarding the quality and standard of coal used in the boilers.
15. As regards the compensation claim, we accept the contention of the respondent that it is grossly time-barred in terms of the Article 137 of the Limitation Act, 1963. The ruling of the Hon’ble Supreme Court in Corporation Bank & Am. v. Navin J. Shah, reported in I (2000) CPJ 13 (SC)=II (2000) SLT 140=2000 CTJ 81 (SC) (CP), lends further support to the view that the period of three years allowed for filing a money claim has to be reckoned from the date when the cause of action arose. In the instant case, the UTP Enquiry as well as the compensation claim arise from the same cause of action but while the complaint petition (UTPE 47/89) was filed on 23.2.1989, the compensation application was filed about seven vpars later i.e. on 15.4.1996.
As such the compensation application is grossly time-barred. We are also of the view that the limitation period of three years has to be reckoned from the date when the cause of action arises and not the date of decree holding the respondent guilty of unfair/restrictive/ monopolistic trade practices.
16. In view of the foregoing discussion, we find no substance in the allegation of unfair trade practices as made out by the DG in his PIR. The UTP Enquiry No. 47/89 is accordingly dismissed and the NOE, issued in this regard, is discharged. The Compensation Application No. 237/96 is also dismissed because, apart from being grossly time-barred, the question of claiming compensation does not arise because the DG and the applicant/informant have failed to establish any case of unfair trade practices against the respondent. There shall be no order as to costs.