(Delivered on 25/07/2018)

PER SHRI B.A. SHAIKH, HON’BLE PRESIDING MEMBER.

1.         These three appeals are being disposed  of  by this common order as common  question of law and facts  is involved  in all of them.  These three appeals  are filed  by the original complainant  who had filed three complaints bearing Nos. 674, 675 & 676 all of 2011 against the common  respondent  Nos. 1&2 herein  before the District Consumer Forum, Nagpur,  claiming from the said respondents compensation  towards the loss sustained  by  each of them due to  defective seeds provided to them by the said  respondents and further  claiming  from them compensation  towards  physical and mental  harassment  with litigation cost as specified  in prayer clause  of each of the said complaint. 

2.         The District Consumer Forum after hearing both the parties,  dismissed the said three complaints  by passing common impugned order on 12/11/2014 holding that  the complainant /appellant herein  purchased  soybean  seeds  in the  Seed Producing  Program of the respondents  for commercial  purpose for earning  profit  and therefore  they  not fall within the definition  of the Consumer given  under section 2(1)(d) of the Consumer Protection Act, 1986.

3.         The facts in brief giving  rise to the present  appeals are as under:

a.         The appellants are the farmers and the respondents  are the seeds  producing  corporation.  The respondents  gave  public advertisement  calling upon the  farmers  for taking  part  in their seeds  production program. The appellants  had shown  their  willingness  to participate  in that program.  Each of them  entered into an agreement  with the respondents. Accordingly, the appellant  purchased  60 bags  of   Soybean  Seeds  from the respondents for  sowing  in the agricultural land  belonging  to them and their family members.  The appellants had  sown  Soybean Seeds  of 51 bags  in their respective  land  during rainy season  in the  land belonging to them and  their family members. However,  they alleged that that  though there  was  proper  raining  and proper  sowing of  seeds  & cultivation of the land,  the germination of those seeds was only 25% to 30% of the seeds. They  also alleged that  those seeds  of 25% to 30% though  had grown , the crop was not properly  grown. Hence, they  made a complaint  to the respondents as well as  the other authorities  about the same.

b.         It was also alleged by the appellant  in the  complaint   that   Mr. L.H. Meshram , the  Seed Manager and  representative of the  respondents , Mr. L.L. Pande, Agriculture   Officers of Panchyat Samittee concerned  Mr. Sanjay Patil and  Mr. V.B. Patil and the adjoining  land  owner  Mr. Pramod Rewatkar in the presence  of the representative of the appellant  namely  Mr. Gangakisan Nathmal Mundhda had inspected  the aforesaid  soyabin crop of the appellants  on 28/06/2011 and they observed that  there was very less germination  of the seeds and accordingly prepared  inspection  report.

c.         It was also alleged by the appellants    they had incurred expenses  at the rate of Rs. 2000/- per acre  for preparation of land and sowing  the seeds in their  respective lands. They also alleged that  they had  again  sown their  own soybean  seeds  in their  respective  land at the place where  the seeds  were not  grown  and for that  purpose  they  incurred  expenses as specified  in detail  in each of the complaint.  They also alleged that  they got  very less yield  from the crop of the soybean   of their   own seeds of which details are given  by them in their  respective complaint.  The appellant thus assessed loss due to  alleged defective  seeds  sold  to  them by the respondents, of which  details  are given in each of the complaint and as reproduced  same in  the common impugned order in detail.  Thus  alleging deficiency  in service  on the part of the respondents  the aforesaid  three complaints  were filed  by the  complainant   against the respondents claiming  from  them  compensation for  loss and  compensation  for physical and mental  harassment  with litigation cost as specified in  detail  in prayer clause  of respective complaint.

d.         The respondents appeared before the Forum below and they  resisted  the complaint  by filing  reply to each of the  complaint.  Their main submission  was that  it was commercial  transaction as per  agreement  in between them and  appellants  and  therefore the complaints were  not maintainable  before the  Forum.  It was also their common submission  that they  sale  seeds  only after due certification of the same. They  thus denied that  the seeds  sold by them  to the appellants  were defective.  They also denied  that there was  germination of  only 25% to 30% of  seeds sold by them to the appellants.  According to them  germination of seeds depends  on various  factor.  The claim  for  compensation  made by the appellant is not  supported by the documents. No relationship    of consumer and service provider exists in  between  the appellants  and  respondents.  Therefore, it was prayed   by the respondents in their  respective  reply that  said complaints  may  be  dismissed.

e.         The District Consumer Forum after hearing  both the parties and  considering the evidence brought on record ,  as observed above  dismissed  all the  three complaints  by passing  common impugned order holding that  the  contract made  in between  both the parties  is  relating to the commercial transaction  and hence,  the appellants  did not  fall within the  definition  of the Consumer.

4.         As observed above, these  three appeals  are filed by the  original complainant.  Learned advocate  Mr. Sudhir Malode appeared for the appellants and learned advocate  Mr. Parvej Dakodia appeared for the  respondents. The learned advocates of both the parties  filed  written notes of arguments  in all these appeals.  The learned advocate of the appellant made oral  submission on 17/07/2018 when  these appeals were listed for final hearing. The learned advocate of the respondents  did not appear on 17/07/2018 before this Commission  for making oral submission.  It  appears  that  he relied  on his written notes of  argument filed  on record.  Therefore, we considered  his  written notes of arguments  as his oral  submission.  We have thus  perused the entire record  and proceedings of these appeals.

5.         The sum and substance  of the submission of the learned advocate of the  appellant  is as under.

            The District Consumer Forum below  erred  in dismissing  the complaints on the  ground that  it is  a commercial  transaction  entered in to  both the parties  and  appellant  did not fall within  the  definition  of the Consumer. According to him,  it was  not a commercial transaction  in between both  the parties and hence,  the  impugned order deserves  to be set aside.  Moreover, it is  proved  from the documents  filed on record that  the  seeds sold by the  respondents  to the appellant were defective  and therefore, there was  germination of 25% to 30% of  seeds only and hence appellants  suffered  loss of yield of which  details are  given  in each of the  complaint  by them.  He therefore, requested that  the impugned order  may be set aside  and  compensation  and cost claimed  in the respective  complaint  may be granted.

6.         On the other hand, the sum and substance  of the  learned advocate of the respondents  as made in his written notes of argument  is as under:

            The District Consumer Forum below  has  rightly dismissed  all the three complaints  on the preliminary  issue of non  maintainability  of  those complaints. There was buy back agreements  entered into between the appellants  and  respondents  and hence,  the appellants do not fall within  the definition  of Consumer. The District Consumer Forum below  has  considered the decision  of the Hon’ble  National Commission and rightly  passed the impugned order.  No question was  raised before the Forum  that the  agreements  entered  in to both the  parties  were  bogus . There are various factors which adversely affect the  yield of the crop and hence,  the seeds cannot be attributed  as the ground for low yield they got.  Hence these three appeals  deserve to be dismissed.

7.         At the outset  it is worthy to note that  the Hon’ble Supreme Court in identical  case of M/s. National Seeds Corporation  Ltd. Vs. M. Madhusudhan Reddy & another, in Civil Appeal No.  7543/2004, vide order dated 16/01/2012  settled the legal position  as regards the  issue of  maintainability of the complaint  involved  in the  present appeals.  In that case the consumer complaints  were filed  before the District Consumer Forum with allegation that  the respondent  had  suffered loss due to  failure of crops /yields because  the seeds sold  or supplied  by the appellant  were defective. The District Consumer Forum allowed those complaints and awarded compensation  to the respondents. The  appeals and revisions filed by the appellant  were dismissed. Therefore Special Leave Petition  was filed before the Hon’ble Supreme Court by the appellant. One of the issue  involved in  those complaints was that  the growers of the seeds who had entered in to  an agreement  with the appellant are not covered  by the definition of the Consumer  under section 2(1)(d) of the Consumer Protection Act, 1986 because they had purchased  the seeds for  commercial purpose.

            The Hon’ble Supreme Court in para No. 33 of the judgment  dated 16/1/2012 passed in the  said appeal  made following  observation,

            “33. What needs to be emphasized is that the appellant had selected a set of farmers in the area for growing seeds on its  behalf. After entering into agreements with the selected farmers, the appellant supplied foundation seeds to them for a price, with an assurance that within few months they will be able to earn profit. The seeds were sown under the supervision of the expert deputed by the appellant. The entire crop was to be purchased by the appellant. The agreements entered into between the appellant and the growers clearly postulated supply of the foundation seeds by the appellant with an assurance that the crop will be purchased by it. It is neither the pleaded case of the appellant nor any evidence was produced before any of the Consumer Forums that the growers had the freedom to sell the seeds in the open market or to any person other than the appellant. Therefore, it is not possible to take the view that the growers had purchased the seeds for resale or for any commercial purpose and they are excluded from the definition of the term `consumer'. As a matter of fact, the evidence brought on record shows that the growers had agreed to produce seeds on behalf of the appellant for the purpose of earning their livelihood by using their skills and labour.”

8.         The aforesaid  observations made by the Hon’ble Supreme Court in the aforesaid  case are  squarely applicable  to the facts and circumstances of the present  case as they are identical  to those of the said cases.  In the instant case also  agreements were entered  in to between both the parties  and on  the basis of the same  the respondent  supplied  foundation seeds to the appellants  for price with the assurance that  they will be able to earn profit.  Moreover,  assurance was given by the  respondent  that they will  purchase those seeds from the appellant as produced  from his agricultural land. The said agreement  do not show that the appellant had  freedom to  sell  the  seeds in the open market or   to any  person other  than the respondents. Therefore, it cannot be said that the appellant  had  purchased  the seeds from the respondent  for  resale or for any commercial purpose and that  they are  excluded  from the  definition of the Consumer. The facts and evidence   brought on record  prove  that  the appellants  had agreed  to produce the seeds on behalf of the respondent  for the   purpose of earning  their  livelihood  by their  skills and labour.

9.         Thus, we find that  the  District Consumer Forum erred in holding that the   appellants do fall  within the definition of Consumer given  under section  2(1)(d) of Consumer Protection Act, 1986  and transaction  by way of agreement  made by them with the respondent  was exclusively  for commercial  purpose to earn profit.  Thus applying  the aforesaid decision of the Hon’ble  Supreme Court to the facts and circumstances of the  present  case, we hold that  the  common impugned order  by which three complaints  have been dismissed on the ground  of there non  maintainability under the Consumer Protection Act, deserves to be set aside. 

10.       We now proceed to  consider the  allegation of the appellants  about  the defective  seeds  sold by the respondent  to them.  A panchanama was prepared by the competent  authorities   in the presence of the representative  of the  respondents after  actual paying  visit  to the land  of the appellants  in which  the seeds were sown by them.  The said panchanama also bear the signature  of the  all the  authorities and  representative  of the respondent  and  witness in whose presence  the crop was inspected.  The evidential value  of the said document  is not rebutted  by the respondent  by adducing  any evidence.  The said panchanama specifically shows that  the  germination of the seeds  was to the extent  of 32% to 35% only.

11.       The Hon’ble Supreme Court  in the aforesaid case of M/s. National Seeds Corporation  Ltd. Vs. M. Madhusudhan Reddy & another, confirmed  the order of the District Consumer Forum below in which  there were  identical facts and  circumstances. Therefore, we hold that  there was germination  of only 30% to 35% of the  seeds though admittedly  the  respondent  had claimed  that the germination   capacity of those seeds was  70%. Therefore,  it can be said that the  seeds were defective  as sold  by the respondent  to the appellant and therefore,  the appellants are entitled  to  compensation  for loss suffered  by them due to defective seeds.

12.       The appellants have given  detail of loss suffered  by them in their  respective  complaint. They deducted the income they got from the seeds which  they had sown  in their land during  same season,  subsequent to the  non germination  of the aforesaid  defective seeds and  thus  after deducting  said  income  which they  got from their  own seeds, they made  claimed for loss.  In our view the claim made for compensation due to  loss suffered by the appellant  can be accepted without any hesitation.  The original complainants/appellants  in their respective complaint has  given details  of area  of the land  in which  soybean seeds were sowed, expenses incurred for sowing  the said seeds , loss of yield due to short germination  of seeds and  market price  of soyabean  seeds produced by them. There is no reason to  disbelieve the same.   Therefore, we hold that  compensation  claimed in  each of the complaint  by the appellant  for loss suffered  by them deserve  to be granted with  interest.  Moreover, we also find that the  compensation  of Rs. 25,000/-  for  physical and mental  harassment and  litigation cost  of Rs. 10,000/- deserve to be granted  to  each of the appellant. Thus disagreeing  with the submission  made in the  written  notes of argument  by the respondent’s advocate  and  for the aforesaid  reasons  we pass the following order.

ORDER

i.          The three appeals  bearing Nos.  A/15/62, A15/66 and A/15/69 are partly allowed.

 ii.          Common impugned order dated 12/11/2014 passed in three complaints bearing  Nos. 674,675 & 676 all  of 2011 is hereby set aside. The said three complaints are partly allowed.

iii.         The respondent  Nos. 1&2/original  O.P. Nos. 1&2 are directed to pay  the complainant  in  original  complaint No.  674/2011, Rs. 1,14,576/-,  to  the complainant in complaint No. 675/2011, Rs. 10,45,952/- and to  the complainant  in complaint  No. 676/2011, Rs. 9,66,408/-, with interest  at the rate of 9% p.a. from the date of the said complaints i.e.  from 11/11/2011 till  realization of the said  respective amount by them towards loss sustained  by them due to  defective seeds.

iv.        The respondent  Nos. 1&2/original  O.P.Nos. 1&2 shall also  pay compensation  of Rs. 25,000/-  for physical and mental  harassment  and litigation cost of Rs. 10,000/- to each of the said  complainant  in  the said three complaints.

v.         Copy of order be  furnished to both the parties , free of cost.