Thursday, February 17, 2011

MARUTI 800 CAR- INCREASE IN EXCISE DUTY PAYABLE BY WHOM ?


                                     1


                     IN THE SUPREME COURT OF INDIA

                        CIVIL APPELLATE JURISDICTION

        SPECIAL LEAVE PETITION(Civil) No(s).10364/2006



RAVINDER RAJ                                                     Petitioner(s)

           VERSUS

M/S. COMPETENT MOTORS CO. PVT. LTD.&ANR.                         Respondent(s)

WITH SLP(C) NO. 9739-9740 of 2009

                                    O R D E R

             Two Special Leave Petitions, being SLP(C)

   Nos. 10364 of 2006 and 9739-9740 of 2009, have

   been filed against the judgment and order dated

   19th July, 2005, passed by the National Consumer

   Disputes        Redressal   Commission     at   New   Delhi    in

   Revision Petition No.1485 of 2005 and the order

   dated     7th     August,    2008     passed    by    the    said

   Commission in Revision Petition No.2974 of 2005

   filed     by     the     respondent    No.1,    Maruti      Udyog

   Limited and also M.A.No.599 of 2006 in Revision

   Petition 1533 of 2005 filed by the respondent

   No.2,     namely,       Competent Motors Co.Pvt.Ltd., the

   dealer.

   2.      The petitioner, Mr. Ravinder Raj, who is

   appearing       in     person,   applied   to   Maruti      Udyog

   Ltd.in 1985-1986 for booking a Maruti Car-800 and
                                  2

deposited a sum of Rs.10,000/- as initial/advance

booking      payment.            On     15th    July,      1988,     the

respondent No.2 informed the petitioner by letter

of   even        date    that    his    Maruti       Car    Allotment

No.0802-N-04051          had    matured        for   delivery       and

requested the petitioner to make payment of the

full amount of the             price of the car for delivery

of   the    vehicle      after    completing         the    necessary

formalities.            Pursuant to the above letter, the

petitioner on 16th February, 1989, paid a total

amount of Rs.78,351.05 which covered the price of

the vehicle, insurance charges and other minor

charges, including registration charges.                           There

is no denial that the petitioner had opted for a

cream colour vehicle.

3.         On 1st March, 1989, there was an increase

in the excise duty payable, causing a price hike

of about Rs.6710.61.               On 18th March, 1989, the

petitioner received a letter from the respondent

No.2   to    deposit      the    excess        amount   payable      as

excise duty, and, accordingly, the petitioner did

so under protest on 16th February, 1989.

4.         The official billing in respect of the car

was done on 5th April, 1989.

5.         The   petitioner       has     contended        that     the

delay in delivery of the vehicle to him by the
                                  3

respondents was not occasioned by any failure or

negligence on his part and                  the liability to pay

the increased amount on account of increase in

excise duty, was not that of the petitioner, but

of the respondents concerned.                      The petitioner,

therefore, applied to the District Consumer Forum

for a direction upon the respondents to bear the

increase in excise duty resulting in                     increase in

the price.         Such a prayer was rejected by the

District    Consumer    Forum.              The    petitioner       then

went   to    the    State     Forum          which      allowed     the

petitioner's       claim.      Against            the   said   order,

the    respondents      went           before        the     National

Commission, which reversed the order passed by

the State Forum.            It is against the said order

that the petitioner has come to this Court by way

of this Special Leave Petition.

6.       As indicated hereinabove, the main ground

urged by the petitioner is that since he was not

responsible for the delay in the delivery of the

vehicle,     he    should    not       be    made       to   bear    the

increase in the price, particularly, when from

the documents, as indicated by him, the vehicle

of the      colour chosen by him was available with

the respondents.            He, therefore, submitted that

the order of the National Forum was erroneous and
                                      4

was liable to be set aside.

7.         Appearing    for       the        dealer,      M/s.Competent

Motors       Co.Pvt.Ltd.,         Ms.        Sapna      Sinha,        learned

advocate pointed out that even from the receipt

of   the     amount    paid       by       the    petitioner          on   16th

February, 1989, it will be clear that the amount

paid was subject to the price prevailing on the

date    of    the   invoice.                 According       to       learned

counsel, since the bill was dated 5th of April,

1989, it was the petitioner who was required to

bear    the    increase      in    price          on    account       of   the

increase      in    excise    duty.                    Furthermore,        she

reiterated that the colour which the petitioner

had wanted was not available at that point of

time,      although,    from           the       documents       it     would

appear that the same was available.                              According

to her, the said documents only indicated that

these were the colours in which the cars were

being manufactured and did not really indicate

the fact that such a colour was available on a

particular date.

8.         According to her, there was no negligence

on the part of the dealer since having received

intimation about the readiness of the vehicle,

the respondent No.2 had immediately informed the

petitioner, but unfortunately, in the meantime,
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the price had risen.              According to the learned

counsel,        the      respondent          No.2        could      not,

therefore, be made liable for the increase in the

price.

9.        Mr. Dayal, appearing for the the Maurti

Udyog    Limited,       while     adopting      the       submissions

made by Ms. Sinha, also added that having regard

to Section 64 of the Sale of Goods Act, 1930,

the burden of any increase in the price by way of

additional taxes would have to be borne by the

customer and not by the manufacturer.                         He also

reiterated that since there was no negligence on

the     part    of     the   manufacturer           in    making     the

vehicle available to the petitioner and since no

mala     fide        intention     had       been        proved,     the

petitioner would have to bear the increase in the

prices.

10.       Having considered the submissions made, we

may refer to the letter of 15th July, 1988, which

had been written on behalf of the respondent No.2

to      the     petitioner         indicating              that      the

petitioner's          allotment        No.    had        matured     for

delivery.       In the second paragraph of the letter,

the respondent No.2 requested the petitioner to

complete the modalities for effecting delivery of

the car        against the allotment number.                      It was
                                  6

categorically        indicated          that       on       receiving

payment,     delivery       would       be    effected        in     the

sequence of priority.           Coupled with the above is

the proforma invoice dated 15th July, 1988, where

it    was    further        indicated         that      the        price

prevailing     at    the    time       of    billing        would    be

applicable, despite the fact that the details of

the price of the vehicle were set out in the said

invoice.

11.     As   indicated       hereinabove,            even     in    the

receipt given to the petitioner for payment of

the amount in the proforma invoice, it had been

indicated that the prices prevailing on the date

of billing would apply.

12.     In this case, the billing was done on 5th

of April, 2009.        In the absence of any evidence

of any deliberate intention on the part of the

respondents to delay          delivery of the vehicle, we

are unable to agree with the petitioner that the

increase     in     price    has       to    be   borne       by     the

respondents.         The petitioner had relied on two

decisions of this Court in the case of Omprakash

Vs. Assistant Engineer, Haryana                   Agro Industries

Corpn. Ltd., 1994(3)SCC 504 and Mohinder Pratap

Dass Vs Modern Automobiles and                    Anr. 1995(3)SCC

581, on the same issue.                The said two decisions
                                    7

in our view are not applicable to the facts of

this case, on account of the fact that in the

said two matters patent deficiency in the service

had   been    found      by    the   Court     and   it   was    also

pointed      out    that       there     was    no   satisfactory

explanation        for   the    delay     in    delivery    of    the

goods to the consumers, which is not the case as

far as this particular matter is concerned.

13.       Furthermore,          having         regard      to     the

provisions of Section 46A(1)(b) of the Sale of

Goods Act, 1930,              it is the liability of the

petitioner to pay the extra price when the excise

duty had been enhanced prior to the delivery of

the vehicle.

14.       In such circumstances, the Special Leave

Petition fails and is dismissed.

15.       Consequently, in view of this order, the

other Special Leave Petition in which                      interest

on the amount claimed has been prayed for, does

not survive and is also dismissed.

16.       There will, however, be no orders as to

costs in both the matters.


                                          ...................J.
                                          (ALTAMAS KABIR)
                        8


...................J.
                             (CYRIAC JOSEPH)


    New Delhi,
    February 10, 2011.