Chandigarh

DF-II

CC/371/2017

Vishal Gulati - Complainant(s)

Versus

Benetton India Private Ltd., - Opp.Party(s)

Manoj Kumar Rohilla Adv.

13 Sep 2017

ORDER

 

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

Consumer Complaint  No.	:	371 of 2017
Date  of  Institution	:	26.04.2017
Date   of   Decision	:	13.09.2017

 

 

 

 

 

Vishal Gulati r/o # 2519-B, Army Flats, Sector 47-C, Chandigarh

                   …..Complainant

Versus

 

Benetton India Pvt. Ltd. (also known as United Colors of Benetton), J.K. Store, through its Authorized Signatory/General Manager, SCO 106-107, Sector 17-C, Chandigarh.

….. Opposite Party.

 

 

BEFORE:    SH.RAJAN DEWAN                                     PRESIDENT

                   SMT.PRITI MALHOTRA                              MEMBER

 

ARGUED BY:       

Sh.Manoj Kumar Rohilla, Advocate for the complainant

Sh.Sumit Goel, Advocate for the OP.

 

 

PER RAJAN DEWAN, PRESIDENT

1.           In brief, the case of the complainant is that the OP, in order to promote the sale of its products, offered discount @ 50% on the M.R.P. and he purchased a pair of Benetton Shoes of the MRP of Rs.3499/-, vide invoice dated 05.02.2017, Annexure C-1 for Rs.1968/- out of which a sum of Rs.218.69P was charged towards VAT @ 12.5% on the discounted price.  It has been averred that the MRP of the article was already inclusive of all taxes. He also objected to the charging of 12.5% VAT at the MRP of the article but to no effect.  Alleging deficiency in service for the above act & conduct of the OP and also for the unfair trade practice resorted to by the OP, this complaint has been filed by the complainant. 
2.            OP in its written statement has not disputed the facts with regard to purchases made by the complainant. It has been averred that the sale of products during the offer season was subject to the terms and conditions applicable to the discount offer which were duly displayed at the conspicuous places alongwith the offer advertisement at the outlet, including the billing counter. It has been stated that a discounted price does not become a new MRP that ought to be inclusive of all taxes as is being alleged by the complainant. MRP is a threshold price inclusive of all taxes as per the Metrology Rules and the same is a requirement aimed at ensuring that the consumer is made aware of the price, beyond which a particular product cannot be sold. As long as the product is sold under the MRP, the Metrology Rules stand complied with and the seller is free to determine the valuable consideration of the article for sale. It has been contended that MRP is merely a sale consideration between the two parties and cannot, under any circumstances, imply the collection of tax from the consumer. Pleading that there is no deficiency in service or unfair trade practice on their part, the OP prayed for dismissal of the complaint.
3.         The parties led evidence in support of their contentions. 
4.         We have gone through the record and heard the arguments addressed by the learned Counsel for the parties.
5.         It has been argued on behalf of the OP that the product was not sold to the complainant on MRP; rather it was sold in a discounted scheme. It was specifically intimated to the customer that VAT would be payable on the discounted price. When the product was not sold on MRP, question of inclusion of VAT in the discounted price does not arise at all. The OP has not indulged in any malpractice or unfair trade practice and it is vehemently canvassed before us that the complaint is nothing, but, an abuse of the process of law and, therefore, the same may be dismissed.
6.         From a perusal of the record, it becomes evident that the complainant did purchase a pair of shoes from the OP having MRP of Rs.3499/-inclusive of all taxes, as is evident from the tag of the product (Annexure C-2). After giving 50% discount, the total price of the product came to be Rs.1749.50P only, but, however, the OP charged an amount of Rs.1968/- and thereby overcharged an amount of Rs.218.69P from the complainant. The contention of the OP that since the product has been sold at a discounted price, therefore, the OP was within its right to charge VAT on the discounted price is not acceptable. The OP has also failed to substantiate their view point either through some Govt. notification or some case law. When MRP included all the taxes, charging of VAT on the discounted price would amount to indulging in unfair trade practice on the part of the OP.
7.           A similar question arose for determination before our Hon’ble State Consumer Disputes Redressal Commission, U.T. Chandigarh in First Appeal No. 210 of 2015, decided on 01.09.2015 in case titled as “Shoppers Stop and others Versus Jashan Preet Singh Gill and Others”, wherein it has been held that no one can charge more than the MRP and MRP includes all taxes including VAT/other taxes. When MRP is inclusive of all taxes, then VAT/Other taxes cannot be charged separately.   In the recent decision in Appeal No.61 of 2016, decided on 18.02.2016, in case titled as “Benetton India Private Limited Vs. Ravinderjit Singh”, the Hon’ble State Consumer Disputes Redressal Commission, U.T., Chandigarh, while dismissing the appeal filed by the Appellant (Benetton India Pvt. Limited) has held that if it is clearly mentioned as MRP inclusive of all taxes, charging of 5% VAT or tax, is certainly against the trade practice. 
8.           The ratio of the afore-cited judicial pronouncements are squarely applicable to the present lis. Therefore, the act of the OP in charging VAT on discounted product, clearly proves deficiency in service having indulged into unfair trade practice on their part, which certainly had caused immense mental and physical harassment to the complainant
9.           For the reasons recorded above, the present complaint is allowed qua the OP. The OP is directed as under:-

a]       to refund the excess amount charged as 12.5% VAT i.e. Rs.219/-  from the complainant.

b]       to pay an amount of Rs.1,000/- to the complainant as compensation for mental agony & physical harassment;

c]       to pay Rs.2,000/- as litigation expenses.

10.           This order shall be complied with by the OP within a period of 30 days from the date of receipt of its copy, failing which it shall be liable to pay interest @9% per annum on amount as mentioned at sub-para (a) & (b) above from the date of this order till it is paid, apart from paying litigation expenses.
11.           The certified copy of this order be sent to the parties free of charge, after which the file be consigned.

		Sd/	Sd/-
Announced		(RAJAN DEWAN)	(PRITI MALHOTRA)
13.09.2017		PRESIDENT	MEMBER