This is an appeal of the year 2011.
2. On receipt of notice, the respondent has filed his objection to the memorandum of appeal on 25.04.2011. As the appeal was not listed since 24.03.2011, again notice issued to respondent on 19.04.2022 fixing the date of hearing to 11.05.2022. As the respondent was absent on 11.05.2022, matter is taken up today.
3. Heard learned counsel for the appellant.
4. The case of the complainant is that, complainant along with his friend visited Hotel Hello, Jeypore and placed order for a Haywards 5000 beer. After the drink was over the hotel boy handed over a computerized bill charging Rs.90/- and after deduction, the final bill amount was Rs.77/-. Further, the case of complainant is that the MRP of said beer was Rs.62/- but the opp.party has taken Rs.77/- i.e. Rs.15/- extra for the beer. The complainant being an advocate became shocked as the opp.party - hotel charged more than the MRP. Hence, alleging unfair trade practice and restrictive trade practice files the complaint claiming Rs.20,000/- towards compensation for mental agony and Rs.2,000/- towards cost of litigation.
5. On being noticed opp.party appeared and filed written version stating that the opp.party is a star hotel who provides a beautiful shelter, costly sitting arrangements, tables and chairs, special rooms and lighting, fully air conditioned and highly comfortable and pleasing music, and above all well dressed and well behaved highly paid bearers to serve the customers in the best possible way. The servers have served the drink to the complainant along with the accessories and compliments (hot mixture and sauve etc.) and attended to the complainant and his friend, cleared their bottles and plats as such they have taken Rs.15/- excess from the complainant. So, there is no unfair trade practice on the part of the opp.party.
6. Considering the above facts, the learned forum below passed the order holding that the opp.party has taken Rs.15/- extra from the complainant for which the complainant suffered from mental agony and directed the opp.party to pay a sum of Rs.3,000/- towards compensation in all counts in favour of the complainant within 30 days from the date of communication of the order failing which the award shall carry interest at the rate of 12% per annum from the date of the order.
7. Challenging the said order, the appellant has preferred this appeal.
8. During course of hearing, learned counsel for the appellant submitted that while dealing with the matter the learned forum below has lost sight of the fact about the provisions applicable to packages intended for retail sale i.e. The Legal Metrology Package Commodities Act and Rules framed thereunder: Legal Metrology (Packaged Commodities) Rules, 2011.
Relevant portion of the said rule is quoted hereunder,
Rule - 3 Applicability of the Chapter-
The provisions of this Chapter shall not apply to, -
(a) packages of commodities containing quantity of more than 25 kg or 25 litre excluding cement and fertilizer sold in bags up to 50 kg; and
(b) packaged commodities meant for industrial consumers or institutional consumer
Explanation :- For the purpose of this rule,-
i) “institutional Consumer” means the institutional consumer like transportation, Airways, Railways, Hotels, Hospitals or any other service institutions who buy packaged commodities directly from the manufacturer for use by that institution.
ii) “industrial Consumer “means the industrial consumer who buy packaged commodities directly from the manufacturer for use by that industry.
Rule – 3 (b) of the said Rules clearly speaks the provisions of the chapter, shall not apply to the packaged commodities meant for industrial consumers or institutional consumer.
As per clause – 3(b) (i) the institutional consumer means as institutional consumer like transportation, airways, railways, hotels, hospitals or any other service institutions who buy packaged commodities directly from the manufacturer for use by that institution. Learned counsel for appellant relied upon the definition of ‘Industrial Consumer contained in explanation (i) to show that the hotel would be under the coverage of the Act read with Rules. As the appellant coming under the category of ‘hotel’ as per Rule – 3 the provisions of the chapter would not apply to packaged commodities meant for institutional consumers such as hotels. Learned counsel for the appellant cited the decision in the case of Federation of Hotel and Restaurant Associations of India vrs. Union of India (UOI) and others reported in MANU/SC/1624/2017. In the said case Hon’ble Apex Court at Para – 16 and 17 has held as follows:-
“xxx xxx xxx
16. Mr.Sinha relied upon the definition of institutional consumer contained in explanation (i) in order to show that hotels, in particular, would be under the coverage of the Act read with the Rules. First and foremost, a reading of the opining of Rule – 3 would show that the provisions of the Chapter would not apply to packaged commodities meant for institutional consumers such as hotels. Also the Rules cannot take us very much further when it has already been held by us that the Act itself would not apply for the reasons given herein above.
17. We are, therefore, of the view that neither the Standards of Weights and Masures Act, 1976 read with the enactment of 1985, or the Legal Metrology Act, 2009, would apply so as to interdict the sale of mineral water in hotels and restaurants at prices which are above the MRP.”
9. The counsel for appellant has filed the copy of license issued in favour of appellant - hotel for retail vend of foreign liquor in a Hotel (under Chapter-IV, Vol.III) in Form F.L-7.
10. On perusal of the records, citations filed by parties, and taking into consideration the ratio of judgment reported in MANU/SC/1624/2017, on the Legal Metrology (Packaged Commodities) Rules, 2011, we hold that as the appellant comes under the category of hotel, the provisions of the Legal Metrology Acts shall not be applicable to it, being excluded under rule 3(b)(i) of the said rules.
11. The complainant/respondent has filed his petition stating that as the appellant has collected excess cost above the MRP on the beer, it amounts to unfair trade practice.
12. The receipt dated 8/4/2010 filed by the complainant before the forum below shows that the appellant hotel has issued the receipt showing the cost of the beer as Rs. 90/- inclusive of MRP, VAT, and service charges. The bill fails to delineate between the MRP and the service charges and hence misinforms the consumer.
On perusal of the written version filed by the opposite party, we found the opposite party has specifically stated that “the cost of the goods supplied by them was mentioned in the menu card, supplied to each customer,” and it was mentioned in the written version that,
“The Haywards 5000 - 650ml beer costs Rs. 90/-. The complainant read and ordered Haywards 5000 - 650ml and elected to enjoy such pleasure, the comfort, the environment, the beautiful music, and the humble service rendered by the servers.”
13. The Consumer Protection Act, 1986 provides the following inextricable right to every consumer under the said Act:-
“(b) the right to be informed about the quality, quantity, potency, purity, standard and price of goods or services, as the case may be so as to protect the consumer against unfair trade practices;”
The term price of goods or services does not only mean the final prices but also refers to the price breakdown of the said goods or services, including its taxes, VAT, discounts, and any other extra charge levied. This price breakdown enables the consumer to make an informed decision about whether he wants to purchase the said goods or avail the services or not.
14. The appellant should have categorically mentioned the actual rate (MRP) of Haywards 5000 - 650ml beer, the service charges, and the VAT amount applied on the said beer. It is the right of the consumer to be properly informed, through the menu card, about the details of the beer, the service charges, and the VAT charges separately. The rationale behind being informed of the price breakdown in the menu is that, if a consumer knows the exact MRP of the product and the quantum of service charges levied on it via the menu, he might decide to buy the said product from a different, and perhaps a cheaper alternative. Providing the actual MRP and mentioning the quantum of service charges in the menu, i.e. before the transaction takes place, allows the consumer to make holistically informed choices.
But, in the instant case, the menu card, provided/supplied by the appellant hotel to the complainant, neither informed him about the actual price of the beer nor the service charges as levied by the appellant. Even on the receipt, the appellant hotel has mentioned the price of beer as Rs. 90/- which was inclusive of both MRP and service charges. The failure to delineate between MRP and services charges of the product amounts to unfair trade practice and deficiency in service on the part of the Appellant Hotel.
15. In view of the above finding, we hold that the Learned Forum below without going through the relevant rules i.e. Legal Metrology (Packaged Commodities) Rules, 2011, has passed the impugned order, which is illegal and liable to be set aside. As such the order of the learned forum is set aside.
16. As we have already held in earlier paragraphs that the non-mentioning of the actual price of the beer bottle and service charges in the menu card as well as in the receipt issued by the appellant hotel amounts to unfair trade practice and a clear case of deficiency in service on the part of the appellant hotel, we direct the appellant hotel/OP to pay Rs. 1000 to the complainant towards compensation for mental tension and harassment.
17. We further direct the appellant/OP to discontinue/stop and not repeat such type of unfair trade practice and issue the receipts/bills mentioning the details of the amount received by it from the customer under different heads. In the instant case, the Legal Metrology Act 2009 and Rules 2011, may not be applicable to the case of the appellant hotel, but the appellant hotel is bound to issue receipts/bills as per the law.
18. It is further directed that, while issuing invoice/bill/cash memo/receipts for goods sold or services rendered, it shall issue the same as per Rule 5 of the Consumer Protection (General) Rules, 2020 which came into force on 20.7.2020.
19. The impugned order of learned forum below is set-aside.
The appeal is allowed partly.
No cost.
DFR be sent back forthwith.
Supply free copy of this order to the respective parties or the copy of this order be downloaded from Confonet or Website of this Commission to treat same as copy supplied from this Commission.
