JUSTICE V.K. JAIN, PRESIDING MEMBER (ORAL) 1. Late Shri Om Prakash Seth, father of complainant No.2, Baldev Seth, obtained an LPG connection from the appellant/opposite party No.1-Indian Oil Corporation Ltd. (hereinafter referred to as IOC) and the cylinders containing LPG were being supplied to him by opposite party No.2-Citizen Gas Enterprises. It appears from a perusal of the record that at the relevant time, the LPG supplied against the connection obtained by Late Shri Om Prakash Seth was being used in the house of his son, complainant No.2- Shri Baldev Seth and Shri Om Prakash Seth himself was not residing in that house. One LPG cylinder was booked with opposite party No.2 by/on behalf of the registered consumer and was duly supplied. The case of the complainants is that the LPG cylinder was supplied on 05-12-1995 whereas the case of the opposite party No.2 is that it was supplied on 01-12-1995. An explosion took place in the house where complainant No.2 was residing with his family, at about 5:15 A.M. on 06-12-1995, and according to the complainants, window panes of their house as well as of the adjoining flats were smashed due to the impact of the explosion. This is also the case of the complainant that as a result of the explosion one wall of the drawing room was blown up and the windows of the flat fell in a park in the neighbourhood. A number of gadgets such as VCR, microwave oven, stereo, AC and fridge as well as furniture items and crockery items are alleged to have been destroyed due to the said explosion. The matter was reported to the police which, after inspection of the said flat, seized the LPG cylinder as well as the regulator, etc., and sent the same to CFSL for obtaining its opinion in the matter. It was opined by the CFSL that the damage to the premises of the complainants had occurred due to explosion of LPG/air mixture. Another report dated 03-01-1996 was earlier submitted by CFSL, stating therein that there was leakage from the valve/nozzle of the LGP cylinder. The complainants i.e. the registered consumer of IOC, Shri Om Prakash Seth and his son Shri Baldev Seth who was consuming the gas supplied against the connection provided to his father, then filed a complaint against IOC as well as its distributor Citizen Gas Enterprises seeking a sum of Rs.5,15,000/- towards loss to the household goods and loss of Rs.5,00,000/- towards mental shock and agony. 2. The complaint was resisted by the IOC as well as its distributor primarily on the grounds that the gas was being unauthorizedly used by Shri Baldev Seth who was not a registered consumer of IOC; the LPG cylinder was supplied on 01-12-1995 and no leakage was reported at any time prior to 06-12-1995; the complainant did not take necessary precautions to avert the accident since the cylinder was not switched off after its use on 05-12-1995 and the compensation demanded by the complainant was highly inflated. It was also claimed by opposite party No.1-IOC that in view of the agreement between it and its distributor, the sole responsibility in such cases was that of the distributor as well as the complainant and IOC was not responsible in any manner. 3. The distributor of IOC, M/s. Citizen Gas Enterprises, inter alia pleaded that there was no deficiency on its part in providing services to the user of the LPG. 4. The State Commission vide impugned order dated 30-08-2007 directed as under: “(a) OP No.1 shall pay Rs.2.5 lacs as damages for the aforesaid household goods as well as for the mental agony, harassment. (b) OP No.2 shall pay Rs.25,000/- for its negligence. 20. Since both the Ops had insured themselves with the OP No.3 the first charge of payment of aforesaid compensation will be on the OP No.3- insurance company in terms of the policy. 21. Payment shall be made within one month from the date of receipt of this order.” 5. Being aggrieved from the order passed by the State Commission, IOC as well as its distributor are before this Commission by way of two separate appeals. 6. The first question which arises for consideration in this appeal is as to whether Shri Baldev Seth can be said to be consumer of IOC and/or Citizen Gas Enterprises or not, since the pleadings of the parties clearly indicate that late Shri Om Prakash Seth was not using the LPG being supplied against the connection obtained by him. Section 2(1)(d) (ii) of the Consumer Protection Act, 1986 to the extent it is relevant for our purpose reads as under: “(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who 'hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purposes;” It would, thus, be seen that not only a person who hires or avails of any service for a consideration but also a beneficiary of such service who himself does not hire or avail the service for consideration is also included in the definition of consumer. Therefore, since the LPG was being used by Shri Baldev Seth with the permission of his father, late Shri Om Prakash Seth, he was a beneficiary of the services which IOC and its distributor were to provide to late Shri Om Prakash Seth. Hence, Shri Baldev Seth was a consumer within the meaning of Section 2(1) (d) (ii) of the Act at the relevant time. 7. The next question which arises for consideration in this appeal is as to whether there was any deficiency in providing services to the complainant and if so whether the deficiency was on the part of IOC or its distributor or both of them. A perusal of the report of the CFSL dated 09-01-1996 would show that the articles sent to the laboratory comprised LPG cylinder, regulator and gas stove. It further shows that the CFSL expert had also visited the place where the explosion had taken place on 06-12-1995 i.e. A-33, Mandakini Enclave, Alaknanda and the earlier report of CFSL dated 03-01-1996 given by its physics division was also considered. It was reported that the damage to the house in question could have been caused due to explosion of LPG air mixture, which could have been caused by electric spark produced by relay system of the refrigerator kept inside the kitchen of the said house. A perusal of the report dated 03-01-1996 would show that the articles which were examined at the time of preparation of the said report comprised not only the LPG cylinder, gas stove and regulator but also the rubber pipe connecting the gas stove and the LPG cylinder. It was reported that laboratory examination of the LPG cylinder, regulator and stove had revealed that the valve/nozzle portion of the LPG cylinder was defective and leakage had been detected in that portion. 8. It is quite evident from a perusal of the report dated 03-01-1996 prepared by Dr. Rajinder Singh, Senior Scientific Officer (Gr.I) of CFSL that the valve/nozzle portion of the LPG cylinder was defective since leakage was detected in the said portion. The subsequent report of the CFSL dated 09-01-1996 only gives the possible cause of the explosion since, leakage itself would not have caused explosion unless fire was ignited from an igniting substance such as a match stick, a burning candle or may be an electric spark. Therefore, there is no contradiction as such between the report dated 03-01-1996 and the report dated 09-01-1996. What is material for our purpose is that as per the report dated 03-01-1996 the LPG cylinder, which IOC had supplied to the complainant through its distributor was found to be defective on account of leakage from the valve/nozzle portion. 9. In my view, once it is shown that the LPG cylinder supplied to the consumer was defective, this would be a clear case of deficiency in providing services to the consumer since the service provider, which in this case was IOC, has to ensure that the LPG cylinder supplied by it to the consumer through its distributor is free from any defect. Obviously, the cylinder is not free from defect if its valve/nozzle is found to be leaking. 10. It is contended by the learned counsel for the appellant-IOC that had there been leakage at the time of supply of the LPG cylinder, it would have been noticed by the user as soon as the LPG was used from that cylinder for the first time. This is also his submission that IOC cannot be held responsible if the cylinder, which is otherwise free from defect at the time it was supplied, for some unexplained reasons develops a defect at a later stage when it is in the use of the consumer. I, however, find no merit in the contention. No technical evidence has been led by IOC to indicate what could be the possible cause of an otherwise defect free cylinder all of a sudden becoming defective and its valve/nozzle start leaking when in the premises of the consumer. In my opinion, if the valve/nozzle is not defective it cannot of its own start leaking when the cylinder is in the use of the consumer. In a case where leakage occurs within a few days of supply of the LPG cylinder, the assumption would be that the valve used in the cylinder was defective and that is why it started leaking when the cylinder was in the premises of the consumer. Another possibility in this regard is that initially the leakage of gas was so insignificant that the consumer did not notice it and later the leakage all of a sudden became much larger, resulting in accumulation of the LPG in the night of 5/6-12-1995 and such accumulated LPG, on coming into contact with the atmospheric air, caused an explosion on account of some igniting substance, which could possibly also an electric spark generated from the refrigerator, as opined by the CFSL. This is more so, if the cylinder was actually supplied on 05-12-1995 as is claimed by the consumer and not on 01-12-1995 as is claimed by the appellant. I would like to note here that despite a specific assertion of the complainant that in fact the LPG cylinder was supplied only on 05-12-1995 neither the IOC nor its distributor filed the affidavit of the concerned delivery man nor did they file any acknowledgement from the consumer to show that in fact the delivery had taken place on 01-12-1995 as is claimed by them and not on 05-12-1995 as is claimed by the consumer. Therefore, there is no escape from the conclusion that the LPG cylinder supplied to the consumer was not free from defect and its valve was leaking, at the time it was supplied. 11. It is next contended by the learned counsel for the appellant that they have issued instructions to all the consumers to switch off the regulator after every use of the LPG and had that been done, no leakage from the cylinder would have taken place and consequently no explosion would have resulted. The learned counsel for the complainant on the other hand submits that neither any such instructions were given to them nor can it be said that the gas from the defective cylinder would not have leaked had the regulator been properly closed after every use. There is no evidence produced by the appellants to prove that no leakage could have taken place had the regulator been closed after use of the LPG on 05-12-1995. Moreover, assuming the contention of the learned counsel for the appellant-IOC to be correct, the fact remains that there was deficiency on the part of the said corporation in providing services when it supplied a defective LPG cylinder to the consumer. A breach of the instructions issued by IOC on the part of the consumer would have an impact on the quantum of the compensation but would not wipe out the defect in the services provided by the said corporation, by supplying a defective LPG cylinder to the consumer. 12. The learned counsel for the appellants also point out that a complaint was made by the consumer on 09-10-1995 and on checking of the equipment it was found that the gas cock of the hot plate was defective and was required to be replaced. An allegation to this effect is made in para 4 of the reply filed by opposite party No.2 and the contention of the learned counsel is that no rejoinder to the said reply was filed. The report of CFSL does not show any defect in the hot plate which was also sent to it along with LPG cylinder, etc., whereas a defect was found in the LPG cylinder since its valve was found to be leaking. The obvious inference would be that either the gas cock was not defective or the defect was got removed by the consumer prior to the explosion took place on 06-12-1995. 13. The next question which arises for consideration is as to who is liable to compensate the complainant for the loss caused to his house as well as the articles kept in the said house. As far as the appellant-IOC is concerned it was clearly deficient in providing services since the LPG cylinder supplied by it through its distributor is found to be defective. However, as far as the distributor is concerned no deficiency on its part could be established by the consumer. This is not the case of the complainant that there was any shortcoming in the installation of the cylinder in its premises by the mechanic of the distributor. The distributor obviously supplied the LPG cylinder in the same condition in which he received it from IOC and this is not the case of the IOC that the defect in the cylinder occurred on account of some mishandling on the part of the distributor before it was supplied to the consumer. Therefore, in my view, the distributor, M/s. Citizen Gas Enterprises cannot be held responsible for the loss to the consumer. 13. Coming to the quantum of compensation, the complainant claimed the following amounts on account of damages to their house and the articles kept in therein: 1. 7 wooden doors Rs.31,500 2. 1 Main Door Double Rs.11,500 3. 8 windows with glass panes Rs.24,000 4. Fixtures (Wooden Almirahs, Big Dining Rs.85,000 Cabinet, Dressing Table, etc.) 5. Two Double Beds Rs.35,000 6. Furniture(Chairs, Dinging Table, Sofaset, etc.) Rs.65,000 7. Front Wall, Flooring and other repairing work Rs.30,000 8. Sanitary Fittings (Toilet seats, pipes, etc.) Rs.18,000 9. Electronic Equipments (TV, VCR, Microwave Rs.65,000 Oven, Stereo, etc.) 10. AC and Fridge Rs.35,000 11. Electrical damages (Switch boards, exhaust fan, Rs.15,000 Switches, etc.) 12. Crockery & Kitchen Items (Dinner set, tea set, Rs.35,000 Imported glasses etc., toaster, etc.) 13. 2 Steel Almirahs Rs.15,000 14. House Hold items (Curtains, Curtainrods, Rs.50,000 Clothes, etc.) Total Rs.5,15,000 However, no architect was examined by the complainant nor did he produce any report from an architect or an engineer to show the amounts that were required to be spent for repairing the damages caused to the wall, doors and window panes, etc.. Similarly, no report from an architect was produced to prove the cost of repairing of the damages to wooden almirah and furniture items, etc.. Though the complainant alleged damage to a number of electric items neither he produced receipt of those articles to prove that such articles were actually available in his house on the relevant date nor did he prove any estimate of repair of those articles from a mechanic/service centre. In these circumstances, the amount of Rs.2,50,000/- awarded by the State Commission against IOC appears to be on the higher side. In my view, in the facts and circumstances of the case, a lumpsum compensation of Rs.1,00,000/- along with interest on that amount at the rate of 10% per annum from the date of the order of the State Commission till the date of its payment would suitably compensate the complainant for the loss caused to his premises as well as the furniture, electrical gadgets, etc.. 14. During the course of the arguments the learned counsel for the appellant referred to the decision of the Hon’ble Supreme Court in Indian Oil Corporation Vs. Consumer Protection Council Kerala & Anr., (1994) 1 SCC 397 in support of his contention that in a case of this nature, considering the agreement between the IOC and its distributor which is always on principal to principal basis, IOC cannot be held responsible. The aforesaid judgment to the extent relied upon by the learned counsel for the appellant reads as under: "In all contracts or engagements entered into by the Distributor with the customers for sale of LPG and/or the sale and/or installation and/or repairs of appliances and/or connections thereof with LPG cylinders (filled or empty) and/or refills and/or pressure regulators and/or attached equipment the Distributor shall act and shall always be deemed to have acted as a principal and not as an agent or on account of the Corporation, and the Corporation shall not in any way be liable in any manner in respect of such contracts and/or engagements and/or in respect of any act or omission on the part of the Distributor, his servants, agents and workmen in regard to such installation, sale, distribution, connections, repairs or otherwise. The Distributor shall be bound to inform the customers in writing of this provision, through correspondence or at the time of enrollment, of the customer." 15. Thus, it is clear that the relationship is one of principal to principal basis. The reliance by the authorities below that the circumstances, documents and conduct of parties proved the relationship as of principal and agent is difficult to understand. This is a case in which the second respondent Karthika Gas Agency has given an unauthorised connection. If it was a legal connection nothing would have been easier than to produce tile subscription voucher. Such a voucher as rightly pointed out by the learned counsel for the appellant, is important and will bind the appellant-Corporation. The authorities below have not given due importance to the subscriptionvoucher. Section 3(2) of the LPG Control Order reads as under: "No person shall possess or use liquefied petroleum gas filled in cylinder or in bulk form unless he has received supply thereof from a distributor or from an Oil Company." 16. The possession of an LPG gas cylinder by Dr Kamalasanan in this case has not been proved to be authorised. Therefore, on the strength of obtaining possession by means of an unauthorised connection it is not open to the first respondent to foist a contract on the Corporation.” It would be seen from a perusal of the judgment that in the case before the Hon’ble Supreme Court unauthorized LPG connections were provided by the distributor of IOC in violation of the agreement between IOC and its distributor and the possession of LPG was also found to be in violation of Section 3(2) of LPG Control Order. A perusal of clause (17) of the agreement extracted in the above referred decision would show that IOC is not liable in respect of any act or omission on the part of the distributor, his servant, agent and workmen in regard to installation, sale, distribution, connection, repair or otherwise. However in the case before this Commission, no act or omission on the part of the distributor or its agent, servant, workman, etc. is alleged. As noted earlier this is not the case of the complainant or even of IOC that there was some defect in installation of the cylinder in the premises of the consumer. In the case before this Commission, the LPG cylinder when supplied by IOC to the consumer through its distributor was defective since there was a leakage from its valve/nozzle. The aforesaid judgment, therefore, is clearly inapplicable to the facts of the present case. The learned counsel has also relied upon the judgments of this Commission in F.A.No.520 of 1992, Indian Oil Corporation Ltd. Vs. Aklesh Kumar Bansal and Ors., (1995) 3 CTJ (CP) (NCDRC); New India Assurance Co.Ltd. Vs. Mala & Ors. 2(2007) CPJ 80 (NC) and FA No.527 of 2006, Indian Oil Corporation Ltd. Vs. Shri Hansmukhbhai M. Patel, decided on 13-08-2012. However, none of these judgments would apply to a case where there is a defect in the LPG cylinder supplied by IOC to a consumer and this is not the case of either IOC or the consumer that the defect in the cylinder occurred on account of some mishandling on the part of the consumer. 15. For the reasons stated hereinabove the appeal filed by the opposite party No.2-M/s. Citizen Gas Enterprises is allowed and the order of the State Commission to the extent it directed payment of compensation amounting to Rs.25,000/- by the said appellant is hereby set aside. The appeal filed by IOC is allowed to the extent that the compensation awarded to the complainant is modified to a lumpsum payment of Rs.1,00,000/- along with interest at the rate of 10% per annum from the date of the order of the State Commission till the date the said amount is paid. IOC is directed to make payment of the said amount within four weeks from today failing which the said amount shall carry interest at the rate of 12% per annum with effect from the date of this order. 16. The amount which the appellant-Citizen Gas Enterprises had deposited in compliance of the interim order of this Commission be refunded to it along with interest that may have accrued on that amount. Out of the amount which the IOC had deposited in compliance of the interim order of this commission, the amount payable to the complainant including interest in terms of this order be paid to him, within four weeks from today and the balance amount be refunded to IOC. |
