LAW

Manjeet Singh vs National Insurance Company Ltd

Facts:
 Manjeet Singh purchased a second-hand
Tata open truck under a Hire Purchase
agreement.
 The truck was insured by the National
insurance company.
 The vehicle (which was insured by the
National insurance company) was
being driven by Sanjay Kumar at a
wintery night and some people gave a
signal to the driver to stop the vehicle that
night.
 After he stopped, they requested the
driver to give them lift and the driver gave
them lift.
 After a little while, one of the passengers
requested the driver to stop the truck and
there after assaulted the driver and fled
away with the vehicle.
  An FIR was lodged and the respondent
finance company was intimated about
the theft.
 However, the insurance company
rejected the claim on the ground of
breach of terms of the policy by giving a
lift to the passengers.
Findings:
1.As far as the violation in carrying
passengers is concerned, this has
consistently been held not to be a fundamental
breach.
2.To establish the defence that the policy has
been breached, the insurance company must
also show that the breach of the policy is so
fundamental in nature that it brings the
contract to an end
3.The Court held that the appellant was not
at fault in giving lift to some passengers.
Carrying such passengers may be a breach of
the policy, but it cannot be said to be such a
fundamental breach as to bring the insurance
policy to an end and to terminate the insurance
policy.

I. Case Reference

Case Citation : (2017) ibclaw.in 244 SC

Case Name : Manjeet Singh Vs. National Insurance Company Ltd. & Anr.

Appeal No. : Civil Appeal No(S). 21552 of 2017 (@Special Leave Petition (C) N

Judgment Date : 08-Dec-17

Court/Bench : Supreme Court of India

Coram : Mr. Justice Madan B. Lokur and Mr. Justice Deepak Gupta

II. Full text of the judgment

JUDGMENT

Deepak Gupta, J.

Leave granted.

2. None has put in appearance on behalf of the respondent no. 2 despite service. Hence,
the matter has been heard in the absence of the learned counsel for the respondent no. 2.

3. Briefly stated the facts of the case are that the appellant Manjeet Singh purchased a
second-hand Tata open truck under a Hire Purchase agreement dated 13.10.2003 for a
sum of Rs. 8,57,000/- from Respondent No.2. The vehicle was hypothecated in favour of
Respondent No.2. It was insured for a value of Rs.7,28,000/- and the insurance policy
was valid from 25.09.2004 to 24.09.2005. On 12.12.2004, the vehicle was being driven
by Sanjay Kumar on the National Highway near Karnal. Some persons gave a signal to
the driver to stop the vehicle. After he stopped, they requested the driver to give them lift
up to Yamuna Nagar since no other mode of transport was available. Since it was a cold
wintery night, the driver gave a lift to these persons. After a little while, one of
the passengers requested the driver to stop the truck on the pretext that he had to answer
the call of nature. When the truck driver stopped the truck, the three passengers
assaulted the driver, tied his hands and legs with a rope and threw him in a nearby field
and fled away with the vehicle.

4. An FIR was lodged at Police Station, Ladwa on 13.12.2004 and the respondent no. 2,
finance company was intimated about the theft. The complainant had also given a letter
of authority to the finance company to negotiate and settle the claim with the insurance
company. However, no settlement was arrived at and the claim was not settled
and repudiated vide letter dated 11.11.2005 on the ground of breach of terms of the
policy. The owner-complainant filed a claim petition before the District Consumer
Disputes Redressal Forum (for short ‘the District Forum’) alleging that the insurance
company was liable to compensate him for the loss caused to him by the theft of the
truck. The main defence taken by the respondent no. 2, insurance company was that the
driver of the vehicle, by giving a lift to the passengers, had violated the terms of the
policy and, as such, there was breach of policy and the insurance company was not liable.
This ground found favour with the District Forum. The appeal filed by the claimant
before the State Consumer Disputes Redressal Commission (for short ‘the State
Commission’) was rejected and so was the revision filed before the National
Consumer Disputes Redressal Commission (for short ‘the National Commission’). The
District Forum also rejected the claim on the ground that the arbitration proceedings had
been initiated by the Respondent No. 2, finance company against the complainant and
they were at the final stage.

5. As far as the first ground is concerned, we are of the considered opinion, that the
District Forum had not properly appreciated the scope and ambit of the policy. The
violation of the condition should be such a fundamental breach so that the claimant
cannot claim any amount whatsoever. As far as the violation in carrying passengers is
concerned, this has consistently been held not to be a fundamental breach and, in this
behalf, we may make reference to the judgments of this Court in the case of National
Insurance Co. Ltd. v. Swaran Singh, (2004) 3 SCC 297, National Insurance Co. Ltd.
v. Nitin Khandelwal, (2008) 11 SCC 259, Lakhmi Chand v. Reliance General
Insurance, (2016) 3 SCC 100 and B.V. Nagaraju v. Oriental Insurance Co.
Ltd., (1996) 4 SCC 647.

6. In Lakhmi Chand case (supra), this Court held that to avoid its liability, the insurance
company must not only establish the defence that the policy has been breached, but must
also show that the breach of the policy is so fundamental in nature that it brings the
contract to an end.
7. In the present case, the appellant who is the owner, was not at fault. His driver gave a
lift to some passengers. Carrying such passengers may be a breach of the policy, but
it cannot be said to be such a fundamental breach as to bring the insurance policy to an
end and to terminate the insurance policy. The driver, on a cold wintery night, gave lift to
some persons standing on the road. It was a humanitarian gesture. It cannot be said to be
such a breach that it nullifies the policy. No doubt, these passengers turned against the
driver and stole the truck, but this, the driver could not have foreseen. In the cases cited
above, such claims where there is breach of policy, have been treated to be non-standard
claims and have been directed to be settled at 75%.

8. As far as the second ground is concerned, we fail to understand how the arbitration
proceedings between the financer and the insurer, relating to recovery of the loan amount,
can in any way, negate the rights of the insured against the insurance company.

9. In view of the above discussion, we allow the appeal, set aside the orders of the courts
below and direct the respondent no.1-insurance company to pay 75% of the insured
amount of Rs.7,28,000/- along with interest at the rate of 9% per annum from the date of
filing the claim petition till the deposit of the amount. In addition, the insurance company
shall also pay another sum of Rs.1,00,000/- as compensation. Since the financer is also a
party to the petition, the amount shall be deposited before the District Forum, and in case
the claim of the financer has not been settled in terms of the arbitration award, then the
deposited amount shall first be used to pay the awarded amount and the balance, if any,
shall be paid to the appellant. The appeal is disposed of in the aforesaid terms. Pending
application(s), if any, also stand(s) disposed of.

The supreme court was entertaining an appeal against the order of the National
Commission, whereby the revision of the State Commission’s order absolving the
liability of the insurance company was upheld in the matter titled as Manjeet Singh Vs
National Insurance Company Ltd. and Anr, Civil Appeal no(s). 21552 of 2017 @special leave petition (c)
no. 34605 of 2015 decided on 08.12.2017
Challenge
It was challenged by appellant in the present SLP that the insurance company was
liable to compensate him for the loss caused to him by the theft of the truck.

The Insurance company stood by the defence that the driver of the vehicle, by
giving a lift to the passengers, had violated the terms of the policy and, as such,
there was breach of policy and the insurance company was not liable. This ground
found favour with the District Forum
The appeal filed by the appellants was rejected by the state commission, and the
revision filed was rejected by national commission.

Held:
The District Forum had not properly appreciated the scope and ambit of the
insurance policy.

The appellant who is the owner, was not at fault. His driver gave a lift to some
passengers. Carrying such passengers may be a breach of the policy, but it cannot
be said to be such a fundamental breach as to bring the insurance policy to an end
and to terminate the insurance policy.

The apex court relied on the following judgements, National Insurance Co. Ltd. v. Swaran
Singh, (2004) 3 SCC 297, National Insurance Co. Ltd. v. Nitin Khandelwal, (2008) 11 SCC 259, B.V.
Nagaraju v. Oriental Insurance Co. Ltd., (1996) 4 SCC 647 to state that the violation of the
condition should be such a fundamental breach so that the claimant cannot claim
any amount whatsoever. As far as the violation in carrying passengers is concerned,
this has consistently been held not to be a fundamental breach
The court relied upon the judgement of Lakhmi Chand v. Reliance General Insurance,
(2016) 3 SCC 100 to propound that the insurance company must not only establish the
defence that the policy has been breached, but must also show that the breach of
the policy is so fundamental in nature that it brings the contract to an end.
The Appeal was allowed, and the orders of the courts below were set aside.
In view of judgements cited Insurance company to pay 75% of the insured amount
of Rs.7,28,000/- along with interest at the rate of 9% per annum from the date of
filing the claim petition till the deposit of the amount.
Arkdeep Sarkar VS yauatcha

Punjab Grill Restaurant Through ... vs Sh Jai Jeet Singh,Ips on 17 July, 2018
A-10/2018
1/5

BEFORE THE STATE CONSUMER DISPUTES REDRESSAL

COMMISSION, MAHARASHTRA, MUMBAI

Appeal No. A/18/10

(Arisen out of order dated 23/11/2017 passed in Complaint
No.195/2017 of District Forum,
Central Mumbai)

Punjab Grill Restaurant runned by:

M/s. Lite Bite Foods Pvt. Ltd.,
Through its Authorized Representative
Mr.Gajanan Bhiku Bandodkar,
Having its office at: Plot No.317, Udhyog
Vihar, Phase-IV, Gurugram, Haryana
And Having its restaurant at:
F-17, Palladium Hih Street,
Phoenix Mall, Lower Parel,
Mumbai 400
013. ...........Appellant
(s)

Versus
Sh Jai Jeet Singh, IPS,
R/o, 11/B, Nilima,
BG Kher Marg, Malabar Hill,
Mumbai, Maharashtra 400
006. ............Respondent (s)

BEFORE:
Hon'ble Mr.D.R. Shirasao - Presiding Judicial
Member.
Hon'ble Mr.A.K. Zade -Member.

For the Advocate Mr.Pankaj Cheche

Appellant:
For the None
Respondent:
ORDER

Per Hon'ble Mr.D.R. Shirasao - Judicial Member:

(1) Being aggrieved by the judgment and order passed by Ld. District Consumer Disputes
Redressal Forum, Central Mumbai in Consumer Complaint No.195 of 2017 on
23/11/2017 directing opponent to pay an amount of Rs.182/- to complainant in respect of
service charges along with interest on that amount along with costs and compensation,
opponent has preferred this appeal.

A-10/2018 2/5 (2) Brief facts of the case are as under:

Complainant has filed complaint for getting back amount of Rs.181.50 paid by him to
opponent towards service charges along with costs and compensation. He has submitted
that he is working as Additional Director General of Police, Railways. On 12/08/2017 he
along with his wife had gone to the restaurant of opponent situated at Lower Parel,
Mumbai for taking food. He submitted that he had taken food at the restaurant of
opponent. However, quality of the food was not proper and the services were also not
given proper. However, when he had received bill, at that time bill was including 10% of
amount towards service charges amounting to Rs.181.50. He submitted that as services
given were not proper he was not ready to pay amount of Rs.181.50 towards service
charges to opponent. However, opponent had behaved rudely with him and insisted for
payment of that amount to complainant. Complainant submitted that, hence, he has filed
this complaint for getting back amount of service charges from opponent of Rs.181.50
along with costs and compensation.

(3) Although opponent was duly served in the matter no one appeared from their side and
hence the matter proceeded ex-parte against opponent.

(4) Considering the affidavit of evidence filed by the complainant in support of his
complaint the Ld.District Forum has allowed the complaint directing opponent to pay an
amount of Rs.182/- to the complainant along with interest on that amount along with
compensation of Rs.5,000/- and amount of Rs.5,000/- towards costs of litigation. Being
aggrieved by the same opponent has preferred this appeal.

A-10/2018 3/5 (5) Heard Ld.Advocate appeared for the appellant. He submitted that the
opponent was always ready to refund the amount of service charges to the complainant as
services given by them were not to the satisfaction of the complainant. He also submitted
that in that respect opponent had issued cheque of Rs.200/- to the complainant when they
learnt about the order passed by the Ld.District Forum. However, the complainant had
refused to accept the same. Hence he submitted that as opponent has not given any
deficiency in service to the complainant the appeal filed by the opponent be allowed and
complaint filed by the complainant be dismissed.

(6) On perusal of order sheet, it appears that after admission of appeal notice was issued
to the respondent/complainant. It appears that on 21/03/2018 one Mrs.Anupriya Pradeep
Kulkarni appeared on behalf of the respondent along with authority letter. Thereafter,
matter was adjourned for final hearing on 12/07/2018. On 12/07/2018 no one appeared on
behalf of the respondent and hence, arguments of Ld.Advocate appearing for the
appellant were heard and appeal is fixed for passing final orders.

(7) On perusal of record it has become clear that the complainant along with his wife had
gone to the restaurant of opponent for taking food. He had taken food in restaurant of
opponent. However, the food was not proper and services given were also not proper.
Opponent had given bill of food to complainant including amount of Rs.181.50 towards
service charges. As service was not given proper complainant was not ready to pay that
much amount to opponent. However, opponent was not ready for the same and he had
behaved rudely with the complainant and hence, complainant was required to pay that
amount to the opponent. Hence, complainant has filed A-10/2018 4/5 complaint before
the District Forum for getting refund of amount of service charges from the opponent.

(8) Ld.Advocate for the appellant/opponent submitted that the appellant/opponent was
always ready to return amount of service charges to the complainant. Hence, it has
become clear that as opponent had not given proper service to complainant he was ready
to return back the amount charged by him towards service charges to the complainant.
However, appellant/opponent had not given the same to respondent/complainant at the
time of payment of bill. At that time opponent had behaved rudely with the complainant
and insisted complainant to pay the same. Opponent had shown readiness to pay this
amount only when order was passed by the Ld.District Forum and he had sent this
amount to complainant by issuing cheque of Rs.200/- in his favour. However, at that time
complainant had refused to accept the same. Hence, it has become clear that as services
were not given proper by opponent to complainant opponent was liable to pay amount of
Rs.181.50 to complainant which he had charged towards service charges. Hence, we are
of the opinion that the order passed by the Ld.District Forum in that respect against the
opponent to pay amount of Rs.182/- to complainant along with interest on that amount is
legal and correct.

(9) Ld.District Forum appearing for the appellant/opponent has mainly contested the case
in respect of amount of costs and compensation. He submitted that the amount of
compensation awarded is excessive and same be reduced. On perusal of copy of
complaint it has become clear that the complainant had not claimed any specific amount
of compensation and costs from the opponent. It appears that opponent had become ready
to pay the amount of service charges to complainant only when the order was passed by
the Ld.District A-10/2018 5/5 Forum. However, when at the time of payment of bill
complainant was not ready to pay the amount towards service charges, the Manager of the
opponent had behaved rudely with the complainant and insisted that the complainant to
pay the amount of service charges along with bill, although complainant was not satisfied
with the services given by the opponent. We are of the opinion that the complainant is
working as Additional Director General of Police, Railways and had come to the
Restaurant of opponent for taking meals along with his wife. However, the opponent had
not behaved properly with him and insisted him to pay the amount towards service
charges along with bill of the food. Opponent had only become ready to return back this
amount to the complainant when order was passed by the Ld.District Forum. Hence, it
has become clear that the behaviour of the Manager of the opponent at the relevant time
with the complainant was not proper and hence, complainant is entitled to get amount of
costs and compensation. Looking to the status of the complainant we are of the opinion
that the amount of costs and compensation awarded by the Ld.District Forum appears to
be reasonable. Hence, under these circumstances, we are of the opinion that appeal filed
by the appellant is to be dismissed. Hence, we proceed to pass the following order:

ORDER

(i) Appeal is hereby dismissed.

(ii) Parties to bear their own costs.

Pronounced on 17th July, 2018.

[D.R. Shirasao] Presiding Judicial Member [A.K. Zade] Member ep

FOR REFERENCE

https://bnblegal.com/article/service-charge-in-restaurant-hotels-concept-and-legal-
perspective/

JUDGEMENT

PER MR.B.S.WASEKAR, HONBLE PRESIDENT

1) The present complaint has been filed by the complainant under section
12 of the Consumer Protection Act, 1986. According to the complainant,
on 12/08/2017 he went to opponent restaurant along with his wife. He
received bill along with 10% service charges. The food and services were
not up to the mark to pay additional charges. He brought this fact to the
notice of Manager but he rudely refused to remove
the service charges from the bill. Therefore the complainant has filed this
complaint for refund of service charges of Rs.181.50 along with
compensation and cost.
2) Opponent remained absent though duly served therefore matter is
proceeded exparte against opponent.

3) The complainant filed affidavit of evidence in support of his complaint.

He has produced copy of bill showing service charges of Rs.181.50.
According to complainant the food and services were not up to the mark.
The complainant is not bound to pay service charges as charged by the
opponent. The submission of the complainant is not challenged by the
opponent. The opponent has not explained about
the service charges therefore the opponent is liable to refund it to the
complainant. The opponent has wrongly recovered the amount from
complainant thereby he suffered from mental agony. Therefore he is
entitled for compensation. We think compensation of Rs.5,000/- will
suffice the purpose. Besides this the complainant entitled for litigation cost
of Rs.5,000/-. Hence, we proceed to pass the following order. ORDER
1. Complaint is allowed.

2. The opponent is directed to refund the amount of Rs.182/-. (Rupees One

hundred eighty two only) to the complainant with interest at the rate of 9%
per annum from the date of filing of the complaint i.e. 10/10/2017 till its
realization.

3. The opponent is further directed to pay compensation of Rs.5,000/-

(Rs.Five thousand Only) to the complainant for mental agony.

4. The opponent is also directed to pay Rs.5,000/- (Rs.Five thousand Only)

to the complainant as cost of litigation.

5. The above order shall be complied with within a period of two months
from today.

6. Copies of this order be sent to the parties free of cost. Pronounced on

23rd November, 2017 [HON'BLE MR. B.S.WASEKAR] PRESIDENT
[HON'BLE MR. S.R.SANAP] MEMBER db/-
DINESH PRATAP SINGH VS BATA INDIA

State Consumer Disputes Redressal Commission

Bata India Limited vs Dinesh Parshad Raturi on 22 July, 2019

Daily Order

STATE CONSUMER DISPUTES REDRESSAL COMMISSION

U.T., CHANDIGARH

Appeal No.
98 of 2019
Date of Institution
17.05.2019
Date of Decision
22.07.2019

Bata India Limited, having its registered office at 27B, Camac

Street, 1st Floor, Kolkata 700016,.

Having corporate office at Bata House, 418/02, MG Road, Sector

17, Gurgaon, Haryana 122001

And also at Shop No.32, Sector 22-D, Chandigarh - 160022.

...Appellant/Opposite Party.

Versus

Dinesh Parshad Raturi S/o Shri Lalit Parshad Raturi, R/o

H.No.1745-A, Sector 23-B, Chandigarh.

...Respondent/Complainant.

Appeal under Section 15 of the Consumer Protection Act, 1986

against order dated 09.04.2019 passed by District
Consumer Disputes Redressal Forum-I, U.T. Chandigarh in
Consumer Complaint No.64 of 2019.

BEFORE: JUSTICE JASBIR SINGH [RETD.], PRESIDENT.

MRS. PADMA PANDEY, MEMBER.

MR. RAJESH K. ARYA, MEMBER.

Argued by:

Sh. Neeraj Grover, Advocate for the appellant.

Sh. Devinder Kumar, Advocate for the respondent.

PER RAJESH K. ARYA, MEMBER In this appeal, the appellant/opposite
party has challenged order dated 09.04.2019 passed by District Consumer Disputes
Redressal Forum-I, U.T., Chandigarh (in short 'the Forum') vide which, the complaint
filed by the respondent/complainant was allowed in the following manner:-

7. In the light of above observations, we are of the view that the present complaint
of the complainant deserves to succeed against the Opposite Party and the same is
allowed qua it. The Opposite Party is directed:-

(i) To provide free carry bags to all customers forthwith who purchase articles from its
Shop and stop unfair trade practice i.e. to charge for carry bag;

(ii) To refund to the complainant the amount of Rs.3/- wrongly charged for the paper
carry bag;

(iii) To pay Rs.3,000/- to the complainant towards compensation for mental and physical
harassment;

(iv) To pay Rs.1,000/- as litigation expenses;

(v) By way of punitive damages, to deposit Rs.5,000/- in the "Consumer Legal Aid
Account" No.32892854721, maintained with the State Bank of India, Sector 7-C, Madhya
Marg, Chandigarh in the name of Secretary, Hon'ble State Consumer Disputes Redressal
Commission, U.T., Chandigarh.

8. This order shall be complied with by the Opposite Party within one month from
the date of receipt of its certified copy, failing which, it shall be liable to pay the amount
at Sr. No. (ii) to (iv) to the complainant along with interest @ 12% p.a. from the date of
filing of the present complaint, till its realization, besides compliance of direction as at Sr.
No.(i). The amount mentioned at Sr. No.(v) be deposited in the account aforesaid, within
one month from the date of receipt of its certified copy, failing which on order becoming
final, necessary steps for execution of order be taken. A copy of this order be also sent to
the Secretary (SCDRC), U.T. Chandigarh, for necessary action."

2. To lay challenge to the order passed by the Forum, the first argument raised by
the Counsel for the appellant/opposite party was that the credit card slip filed by the
respondent/complainant with the complaint revealed that the goods were purchased by
one Ms. Poonam, however, the complaint before the Forum was filed by one Mr. Dinesh
Parshad Raturi (respondent/complainant). He argued that as such, there was no relation of
consumer and service provider between the appellant/opposite party and the
complainant/respondent and the respondent/complainant had no locus-standi to file and
pursue the complaint before the Forum.

3. In this regard, it may be stated here that the plea now raised at this stage in
appeal was never raised before the Forum. Perusal of Invoice and HDFC Bank Payment
Receipt (Annexure C-1 colly.) on record of Forum reveals that payment of Rs.402/- was
made by using credit card of one Poonam for the purchase of articles in question. During
the course of arguments, it was stated at bar by the Counsel for the
respondent/complainant that Sh. Dinesh Parshad Raturi and Ms. Poonam are husband and
wife and being beneficiary, the complainant, namely Sh. Dinesh Parshad Raturi filed the
complaint. Counsel for the appellant/opposite party did not dispute the statement made at
bar by the Counsel for the respondent/complainant. Otherwise also, Section 2(1)(d) (ii)
of Consumer Protection Act, 1986 comes for rescue of the respondent/ complainant,
which clearly stipulates as under:-

"(d) "consumer" means any person who--

(i) xxxxxxxx

(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;

Explanation.-- For the purposes of this clause, "commercial purpose" does not include use
by a person of goods bought and used by him and services availed by him exclusively for
the purposes of earning his livelihood by means of self-employment;"

Thus, in view of aforesaid provisions of the Act, being the beneficiary, the
respondent/complainant is definitely a consumer and as such, the argument raised in this
regards stands rejected.

4. The next argument raised by the Counsel for the appellant/opposite party was
that the sale of paper carry bag is optional purely at the discretion of the consumer and
further there is no prohibition on the appellant/opposite party to charge for the carry bag.
To support his argument, he referred to a document (Annexure - F), which is a photocopy
of one of such notice saying that 'purchase of carry bags is optional and not
necessary/mandatory'.

5. Qua aforesaid contentions, it may be stated here that similar contentions were
raised before this Commission in the case of Westside, a unit of Trent Limited Vs. Sapna
Vasudev, Appeal No.36 of 2019 decided on 08.04.2019, wherein this Commission held in
Paras 12 & 13 as under:-

"12. Counsel for the appellant/opposite party vehemently argued that the purchase
of bag is entirely optional and is a voluntary act by a consumer and further the customers
cannot bring their own carry bags or bags containing items/goods purchased from other
shops. It may be stated here that the argument raised is totally absurd and vague and
against the interest of consumers. On one hand, purchase of carry bags is made optional
& voluntary and on the other hand, the consumer/customer is not allowed to enter the
shop with empty carry bag or carry bag containing some goods purchased from other
shop premises. By adopting above practice, the appellant/opposite party left the
respondent/complainant with no other option with her but to buy the carry bag alongwith
the goods purchased, to carry such goods from the shop-premises. By not allowing the
customers to bring in the shop premises their own carry bags and thrusting its own carry
bags against consideration, the appellant/opposite party is deficient in providing due
service and also indulged into unfair trade practice. One cannot be expected to take the
goods/garments purchased in hands. We are shocked to see the kind of services provided
by these big Malls or Showrooms. On one side huge discounts are given ranging up-to
70% on the products by these shops/showrooms etc. and on the other hand, they are
charging for a carry bag and could not give it free of cost to its worthy consumers."

13. The next argument of Counsel for the appellant/opposite party that there is no
prohibition on the appellant/opposite party to charge for the carry bag is also not
sustainable in the eyes of law and observations given by us in the earlier part of the
judgment. As already held, charging for a carry bag is against the interest of the
consumers and particularly in view of argument raised by the Counsel for the
appellant/opposite party that purchase of bag is entirely optional and a voluntary act and
further the customers cannot bring their own carry bags or bags containing items/goods
purchased from other shops, which we have already rejected in the preceding paragraph."

6. Elaborating his argument to contradict the afore-extracted observations made

by this Commission, Counsel for the appellant/opposite party submitted that in case, the
respondent/ complainant was not willing to buy the carry bag, he could bring his own
carry bag. To say so, reliance was placed on document (Annexure-F). It may be stated
here that the argument raised totally baseless as the aforesaid document was never placed
in evidence before the Forum during the pendency of the complaint. Not only this, the
appellant/opposite party has miserably failed to prove on record that the said notice
saying that the carry bags are optional, was there in the premises of the appellant/opposite
party on the relevant date and time when the respondent/complainant purchased the shoes
from it. Had such like notices been there, still the appellant/opposite party, was expected
to and in future also, supply a paper carry bag free of cost. By relying upon such like
document and raising such a flimsy ground, the appellant/opposite party cannot run away
from its duty to supply a paper carry bag free of cost to a consumer who buys goods from
it against consideration paid. The respondent/complainant cannot be expected to take the
shoes in hand without a carry bag from the billing counter up to his or her destination or
vehicle. Thus, reliance placed on document (Annexure-F) is an afterthought as no
credence can be given to it. It is purely and simply an attempt on the part of the
appellant/opposite party to cover up the lacunas. Consumerism should prevail and such
kind of practice of charging for paper carry bags should be stopped immediately, which
have to be supplied free of cost to the consumers.
7. We may also state here that firstly charging for a paper bag and secondly,
putting its logo i.e. " Bata Surprisingly Stylish" on the same is a clear cut unfair trade
practice on the part of the appellant/opposite party. In our recent judgment in the case of
Westside, a unit of Trent Limited Vs. Sapna Vasudev, referred to above, this Commission
has already held the act of charging for a paper bag and putting Company's Logo on it, to
be an act of unfair trade practice on the part of the seller. Relevant Paras 10 to 11 of the
judgment reads thus:-

"10. However, on merits of the case, it may be stated here similar controversy qua
charging for paper bags came before this Commission in the case of " M/s. Lifestyle
International Pvt. Ltd. Vs. Pankaj Chandgothia & Anr.', Appeal bearing No.24 of 2019
decided on 18.03.2019, wherein this Commission held in Paras 11 to 15, inter-alia, as
under:-

"11. So far as reliance placed by the appellant/opposite party on Rule 10 of The

Plastic Waste (Management and Handling) Rules, 2011 and Rule 15 of Plastic Waste
(Management and Handling) Rules, 2016, published vide notification dated 18.03.2016,
issued by Ministry of Environments and Forests is concerned, we would like to first
extract the aforesaid Rule hereunder:-

"10. Explicit pricing of carry bags. - No carry bag shall be made available free of cost by
retailers to consumers. The concerned municipal authority may by notification determine
the minimum price for carry bags depending upon their quality and size which covers
their material and waste management cost in order to encourage their re-use so as to
minimize plastic waste generation."

"15. Explicit pricing of carry bags.- (1) The shopkeepers and street vendors willing to
provide plastic carry bags for dispensing any commodity shall register with local body.
The local body shall, within a period of six months from the date of final publication of
these rules in the Official Gazettee of India notification of these rules, by notification or
an order under their appropriate state statute or byelaws shall make provisions for such
registration on payment of plastic waste management fee of minimum rupees forty eight
thousand @rupees for thousand per month. The concerned local body may prescribe
higher plastic waste management fee, depending upon the sale capacity. The registered
shop keepers shall display at prominent place that plastic carry bags are given on
payment."

12. It may be stated here that no doubt, as per Rule 10 of The Plastic Waste
(Management and Handling) Rules, 2011, no carry bags were to be made available free of
cost by retailers to consumers but thereafter, in the year 2016, the aforesaid Rules were
amended vide notification dated 18.03.2016 to be read as Plastic Waste (Management and
Handling) Rules, 2016. It is important to mention here that the aforesaid Rule 15 of
Plastic Waste (Management and Handling) Rules, 2016 was omitted vide subsequent
Notification dated 27.03.2018 and as such, the appellant/opposite party cannot take
shelter of the said rule. Since the mandate for retailers to charge for plastic carry bags has
been omitted in March 2018, therefore, its contention that it could charge for paper carry
bags is totally against law and has no legs to stand.

13. With all concern, we must say that charging for paper carry bags is totally
against consumerism. First of all, it is nowhere the plea of the appellant/opposite party
that it has displayed in the shop premises or at the entry gate that the customers can bring
their own carry bags to carry the goods purchased from the appellant/opposite party. We
have seen that in these days, it is general practice prevalent in the market that if a person
who goes to the shop premises like the appellant/opposite party to buy some goods,
he/she is not allowed to enter the said shop premises with any carry bag. The same are
kept at the entry door by the security person standing at the door. In case, the security
person standing at the entry allows to do so, he staples the same so that no other product
is put in the said carry bag. A person who buys some articles/products from the shop
premises like the appellant/opposite party is expected to be provided with free carry bag
to carry those articles up to his car of destination or he/she should be allowed to bring
his/her own carry bag inside the shop premises. Not only this, the Counsel for the
appellant/opposite party failed to show any provision of law/rules/regulations, which
gives such an authority to the appellant/opposite party, not to allow the customers to bring
their own carry bags inside the shop premises of the appellant/opposite party.

14. Further, the Counsel for the appellant/opposite party conceded that it is
nowhere displayed in the shop premises of the appellant/opposite parties, either at the
entry gate or in the shop premises, that the customers can carry the goods purchased from
the appellant/opposite party in their own carry bags or they are allowed to bring their own
carry bags inside the showroom. However, the argument raised by the Counsel for the
appellant/opposite party was that one should adopt the practice of taking articles without
bag out of the shop so that even paper bags can be saved. We are surprised to hear such
kind of argument.

15. Not only above, the carry bags, which are sold by the appellant/opposite party
bear its logo on both sides and the customer who is buying the same is in fact publicizing
the brand of the appellant/opposite party and thereby becomes a brand ambassador. On
the other hand, charging for the said paper carry bag by the appellant/opposite party
amounted to unfair trade practice......."

11. In the instant case also, it has not been disputed by the Counsel for the
appellant/opposite party that the appellant/ opposite party is providing paper carry bags to
its customers on payment of additional price. At the time of arguments, he also conceded
to the argument raised by the Counsel for the respondent/complainant that it was nowhere
mentioned in the entire Shop premises of the appellant/opposite party that it would be
charging for a carry bag. As rightly held by the Forum in its order, the appellant/Opposite
Party miserably failed to produce on record any cogent, convincing and reliable piece of
evidence in the shape of any rules/instructions authorizing it to levy charge additionally
for the carry bag from the gullible Consumers.
8. In our opinion, the Forum has also rightly held in Paras 5 and 6 of its order as
under:-

"5. We had also a glance to the carry bag which is annexed with the consumer
complaint in which advertisement of Bata Company was being published as it has been
printed in red words "Bata Surprisingly Stylish" which shows that Bata Company is
stylish in nature and used the consumer as if he is the advertisement agent of Opposite
Party. The purchase of the item alongwith sale of carry bag is not disputed as per
statement put forth by Opposite Party.

6. Per this evidence brought on record, we record a firm finding that there is
unfair trade practice on the part of Opposite Party in compelling the complainant to
purchase the carry bag worth Rs.3/- and if the Opposite Party is a environmental activist,
he should have given the same to the complainant free of cost. It was for gain of OP. By
employing unfair trade practice, OP is minting lot of money from all customers."

9. In view of above, in our considered opinion, the Forum rightly directed the
appellant/opposite party to provide free carry bags to all customers forthwith who
purchase articles from its Shop and stop unfair trade practice i.e. to charge for carry bag.
It also rightly ordered refund of an amount of Rs.3/- wrongly charged by the
appellant/opposite party for the paper carry bag besides payment of Rs.3,000/- to the
respondent/complainant towards compensation for mental and physical harassment and
Rs.1,000/- towards litigation expenses.

10. Hence, we are of the opinion that the order passed by the Forum, being based
on the correct appreciation of evidence and law, on the point, does not suffer from any
illegality or perversity.

11. No other point was raised by the Counsel for the parties.

12. For the reasons recorded above, this appeal being devoid of any merit, is
dismissed with no order as to costs. The impugned order dated 09.04.2019 passed by the
District Forum-I, U.T., Chandigarh in Consumer Complaint No.64 of 2019 is upheld.

13. Certified copies of the order be sent to the parties free of charge.

14. File be consigned to the Record Room after completion.

Pronounced 22.07.2019.

[JUSTICE JASBIR SINGH (RETD.)] PRESIDENT (PADMA PANDEY) MEMBER

(RAJESH K. ARYA) MEMBER Ad

https://www.casemine.com/judgement/in/5cb2220f9eff430b38999140
M/S. Mcdonald Family Restaurant vs Nisha Goyal on 26 July, 2021

NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI

REVISION PETITION NO. 1246 OF 2016 (Against the Order
dated 26/02/2016 in Appeal No. 689/2015 of the State
Commission Rajasthan) 1. M/S. MCDONALD FAMILY
RESTAURANT (CONNAUGHT PLAZA RESTAURANTS PVT. LTD.) GAURAV
TOWER II, MALVIYA NAGAR, JAIPUR
RAJASTHAN ...........Petitioner(s) Versus 1. NISHA
GOYAL E-592, LAL KOTHI SCHEME JAIPUR
RAJASTHAN ...........Respondent(s) REVISION PETITION NO.
1247 OF 2016 (Against the Order dated 26/02/2016 in Appeal
No. 692/2015 of the State Commission Rajasthan)
1. M/S. MCDONALD FAMILY RESTAURANT (CONNAUGHT PLAZA
RESTAURANTS PVT. LTD.) GAURAV TOWER II, MALVIYA NAGAR,
JAIPUR-302017 RAJASTHAN ...........Petitioner(s) Versus
1. VISHAMBAR DAYAL MEENA R/O 142, NANDPURI MALVIYANAGAR,
JAIPUR RAJASTHAN ...........Respondent(s) REVISION
PETITION NO. 1248 OF 2016 (Against the Order dated
26/02/2016 in Appeal No. 1198/2015 of the State
Commission Rajasthan) 1. M/S. MCDONALD FAMILY
RESTAURANT (CONNAUGHT PLAZA RESTAURANTS PVT. LTD.) GAURAV
TOWER II, MALVIYA NAGAR, JAIPUR
RAJASTHAN ...........Petitioner(s) Versus 1. WASEEM
R/O HOUSE NO. 898, KHANDAAR KA RAASTA MOHALLA SHEKHAN JAIPUR-
302002 RAJASTHAN ...........Respondent(s) REVISION
PETITION NO. 1249 OF 2016 (Against the Order dated
26/02/2016 in Appeal No. 1199/2015 of the State
Commission Rajasthan) 1. M/S. MCDONALD FAMILY
RESTAURANT (CONNAUGHT PLAZA RESTAURANTS PVT. LTD.) GAURAV
TOWER II, MALVIYA NAGAR, JAIPUR-302017
RAJASTHAN ...........Petitioner(s) Versus 1. SWARAN
SINGH R/O PLOT NO. 9, GOVIND NAGAR(WEST) EKTA VIHAR, AMER
ROAD, JAIPUR RAJASTHAN ...........Respondent(s)
REVISION PETITION NO. 1250 OF 2016 (Against the Order
dated 26/02/2016 in Appeal No. 1200/2015 of the State
Commission Rajasthan) 1. M/S. MCDONALD FAMILY
RESTAURANT (CONNAUGHT PLAZA RESTAURANTS PVT. LTD.) GAURAV
TOWER II, MALVIYA NAGAR, JAIPUR
RAJASTHAN ...........Petitioner(s) Versus 1. USHA GARG
R/O 36, ANAND VIHAR VISTAR, TRIVENI NAGAR, GOPALPURA BY PASS,
JAIPUR RAJASTHAN ...........Respondent(s) REVISION
PETITION NO. 1251 OF 2016 (Against the Order dated
26/02/2016 in Appeal No. 1201/2015 of the State
Commission Rajasthan) 1. M/S. MCDONALD FAMILY
RESTAURANT (CONNAUGHT PLAZA RESTAURANTS PVT. LTD.) GOLCHA
POINT 5 BATTI M.I ROAD, JAIPUR-302017
RAJASTHAN ...........Petitioner(s) Versus 1. SABIR
HUSSAIN R/O 1/47, VAN VIHAR COLONY DELHI BY PASS ROAD,
JAIPUR RAJASTHAN ...........Respondent(s)
BEFORE: HON'BLE MR. JUSTICE R.K.
AGRAWAL,PRESIDENT HON'BLE DR. S.M. KANTIKAR,MEMBER
 For the Petitioner : For the Petitioner :
Mr. HimanshuBhushan, Advocate
Mr. Madhurika Ray, Advocate For the Respondent :
For the Respondents: Mr. G.D. Ahmed, Advocate
Mr. Md. Mohsin, Advocate
Ms. Farah Deeba, Advocate
Dated : 26 Jul 2021 ORDER

R.K. AGRAWAL, J., PRESIDENT

M/s Mc Donald Family Restaurant (Connaught Plaza Restaurants Pvt. Ltd.), hereinafter
referred to as the Revisionist, have filed these Revision Petitions under Section 21(b) of
the Consumer Protection Act, 1986, hereinafter referred to as the 1986 Act, against the
separate Orders dated 26.02.2016 passed by the State Consumer Disputes Redressal
Commission Rajasthan (hereinafter referred to as State Commission) in Appeal Nos. 689,
692, 1198, 1199, 1200 and 1201 of 2015, whereby the State Commission had dismissed
the Appeals filed by the Revisionist and have upheld the Orders passed by the District
Consumer Disputes Redressal Forum, Second, Jaipur (hereinafter referred to as the
District Forum).

Since the facts and question of law involved in all these Revision Petitions are similar,
these Revision Petitions are being disposed of by this common Order. However, for the
sake of convenience, Revision Petition No. 1246 of 2016 is treated as the lead case and
the facts enumerated hereinafter are taken from Complaint No. 1426 of 2012 filed before
the District Forum.

Brief facts of the case as enumerated in the Complaint are that the Complainant bought
four Ice-cream Cones from the Mc Donald's Family Restaurant, Revisionist vide
Bill/Invoice No. 009401200153597.As per the Bill/Invoice the amount payable was
₹85.50ps (Ice-cream cone ₹75/- and VAT ₹10.50), but the Revisionist rounded off the
figure by adding ₹0.50 in the Bill and charged ₹86/-, i.e., ₹0.50ps. in excess of the
amount of the Bill/Invoice from the Complainant.It is stated by the Complainant when
she demanded fifty paisa which was charged in excess of the Bill amount from her, the
Revisionist refused to refund the amount of fifty paisa by saying that same has been
rounded off and they used to take payment from each of the customer in same manner by
rounding off the figure.When she asked for Complaint book for lodging complaint, they
refused to provide the same.They also made a fun of the Complainant and misbehaved
with her.Alleging deficiency in service and Unfair Trade Practice on the part of the
Revisionist, the Complainant filed a Consumer Complaint being Complaint No. 1426 /
2012 before the District Forum seeking following reliefs:-

The excess amount of fifty paise recovered by Opposite Party No.1 from the Complainant
on 04.08.2012 may be ordered to be refunded to the Complainant with interest from the
Opposite Parties;

The Complainant may be awarded the compensation of ₹50,000/- (Rupees Fifty

thousands) for the physical and mental agony suffered by the Complainant due to
erroneous and improper business custom of Opposite Party No.1 and the amount of
₹25,000/- (twenty-fivethousand) as penalty, totalling to ₹75,000/-(Rupees seventy five
thousands) may be ordered to be paid by the Opposite Parties to the Complainant.

The bills of the last two years may be summoned from Opposite Party No.1 and the
maximum penalty may be imposed for recovering excess amount in the name of rounding
off the bills in proportionate to the improper benefit earned by Opposite Party No.1 The
Complainant may be awarded the cost the complaint and the Advocate's fee of ₹6,500/-
(Rupees six thousand five hundred) to be paid Opposite Parties."

The Revisionist contested the Complaint before the District Forum.They submitted that at
present in the market coin of ₹0.50 is not easily available. They also submitted that as per
the Circular No. DBOD Dir. BC. 6/13.03.00/2006-07 dated July 1, 2006, issued by
Reserve Bank of India in monetary transaction the amount would be rounded off to the
nearest Rupee.₹0.50ps. and above shall be rounded off to the next higher Rupee and
fraction of less than ₹0.50 ps. shall be ignored.Similar circulars have also been issued by
the Central Excise Department as well as Sales Tax Department etc.Therefore, they were
legally entitled to round off the Rupee to the next higher Rupee if in the Bill 0.50 paisa or
more was shown as payable, and they have not committed any Unfair Trade Practice.

After hearing both the Parties and perusal of material on record, the District Forum
observed that "the operation of the coin of ₹0.50ps. has not been stopped till now. The
coins of ₹0.50ps. are available in the market. The Revisionist took a defence that the
coins of ₹0.50ps. are not easily available. When the coin of ₹0.50ps. is in operation, it is
the duty/responsibility of the Revisionist to make available the coin of ₹0.50ps. to the
customer and not issue the bill for full Rupee. Any of the provision, procedure of
practice is framed by keeping in the interest of general public and where there may be
ambiguity, the meaning of that should be taken in the interest of the customer. If the 50
paisa was not available with the Opposite Party, it was its responsibility that leaving the
amount of 50 paisa and amount of ₹85/- be recovered and not to recover amount of ₹86/-
by adding the amount of 50 paisa in the Bill. Such practice might have been adopted in so
many bills in a day. This is only the awareness of the Complainant that she had come to
the Forum by raising the issue." and allowed the Complaint vide Order dated
07.05.2015.For ready reference the operative part of the aforesaid Order is reproduced
below:-

"..............Opposite Party No.1 pay the amount of 50 paise and interest at the rate of 10%
per annum on this amount from 04.08.2012 up to payment of the amount within 2 month
to the Complainant. Apart from this Opposite Party No.1 pay the amount of ₹50,000/-
(fifty thousand Rupees) towards the total compensation and the amount of ₹5,000/-
towards cost of the case to the Complainant within two months from today. Out of this
the amount of ₹25,000/- will be deposited to the Consumer Welfare Fund and the
Complainant will be entitled to get the amount of ₹25,000/-. In case the above amount of
₹55,000/- is not paid within two months the Complainant will be entitled to get the
interest at the rate of 10% per annum from today until payment of the amount by the
Opposite Party. The Complaint against Opposite Party No. 2 is dismissed."

Feeling aggrieved by the Order dated 07.05.2015 passed by the District Forum, the
Revisionist filed Appeal before the State Commission.The State Commission had
dismissed the Appeal by observing as under:-

"The facts are not in dispute that cost of the food product was ₹85.50 and the appellant
had charged ₹86/-. He has taken shelter of circulars of RBI and various other
departments but they cannot be cured the misdeed of the appellant as S.2 (c) of
the Consumer Protection Act clearly provides that 'complaint' means any allegation where
trader or the service provider has charged for the goods price in excess of the price agreed
between the parties or displayed. Here in the present case, the agreed price between the
parties for the food product was ₹85.50 and he has been charged ₹86/- which clearly
shows that it was deficiency on the part of the Appellant and the court below has rightly
held so. Hence, there is no merit in this appeal and the appeal is liable to be rejected."

Aggrieved by Order dated 26.02.2016 passed by the State Commission, the Revisionist
has filed the present Revision Petitions before this Commission.

Mr. Himanshu Bhusan, learned Counsel appearing on behalf of the Revisionist submitted
that they rounded off the amount to the nearest Rupee in accordance with the Statutory
Circulars, Notification and guidelines issued by the Reserve Bank of India. The State
Commission has failed to appreciate the wide spread ramifications of the non-recognition
of the principle of 'rounding off', it would impact the entire Hospitality and Food and
Beverage Industry which uniformly follows the principle of rounding off in all financial
transactions. There is neither any Deficiency in Service nor any Unfair Trade Practice on
their part and Respondent/Complainant is not entitled for any compensation.He further
submitted that the Impugned Order passed by the State Commission is not sustainable and
it should be set aside.

Per contra, Mr. G.D. Ahmed, learned Counsel for the Respondent/Complainant, .

We may mention here that during the course of Proceedings, while admitting the case on
16.03.2017 this Commission has passed the following Order:-

"Admit confined to the question of quantum of compensation awarded by the Fora

below. To be listed in due course.

In the meanwhile, the operation of the impugned Orders confined to the direction relating
to the award of compensation shall remain stayed."

The Revisionist challenged the above Order before the Hon'ble Supreme Court of India
vide Petition(s) for Special Leave to Appeal (C) No. 15030 / 2017.The Hon'ble Supreme
Court of India dismissed the SLP on 03.07.2017 by passing the following Order:-

"Heard.

We do not see any ground to interfere with the impugned Order. The special leave
petition is accordingly dismissed.

Pending applications, if any, shall stand disposed of."

We have heard Mr. Himanshu Bhusan, learned Counsel for the Revisionist, Mr. G.D.
Ahmed, learned Counsel for the Respondent/Complainant and perused the material
available on record.

Even though, this Commission while admitting Revision Petitions had confined to the
question of quantum of compensation awarded by the Fora below, as the Complainant
had not given any basis for claiming the Compensation, we deem it appropriate in order
to determine the quantum of compensation, to consider as to whether the Revisionist had
committed any Unfair Trade Practice or not, or was there any Deficiency in Service when
it rounded off the amount of 50 paisa and above, showing in the Bill to the nearest Rupee.
We find that it is the practice in the Commercial World, as also in Hospitality Services
including Hotel Restaurants that a fraction of a Rupee if it is 50 paisa or above, is
rounded off to the nearest Rupee and if it is less than 50 paisa it is ignored, meaning
thereby that the person is not liable to pay that amount.

In this connection, we may refer to the Circular dated 09.04.2007 issued by the Reserve
Bank of India with respect to rounding off the transactions to the nearest Rupee.Relevant
portion of the said Circular is reproduced below:-

"Please refer to our circular RPCD.No.RF.BC.68/D.1-90-91 dated January 1, 1991, in

terms of which bank were advised that all transactions, including payment of interest on
deposits/charging of interest on advances, should be rounded off to the nearest rupee; i.e.,
fraction of 50 paise and above all shall be rounded off to the next higher rupee and
fraction of less than 50 paise shall be ignored. Banks were however, advised that cheques
issued by clients containing fractions of rupee should not be rejected or dishonoured."

Prior to that the Reserve Bank of India had issued a Master Circular on Interest Rates on
Rupee Deposits held in Domestic, Ordinary Non-Resident (NRO) and Non-Resident
(External) (NRE) Accounts.Clause 19 of the aforesaid Master Circular dealt with
Rounding off of transactions is reproduced below:-

"All transactions, including payment of interest on deposits/charging of interest on

advances, should be rounded off to the nearest rupee; i.e., fractions of 50 paise and above
shall be rounded off to the next higher rupee and fraction of less than 50 paise shall be
ignored. Issue prices of cash certificates should also be rounded off in the same manner.
Cheques issued by clients containing fractions of a rupee should not be rejected or
dishonoured"

Another Circular was issued by the Reserve Bank of India on 30.03.2007 which provided
for rounding off cheques to the nearest Rupee.For ready reference, relevant part of the
said Circular is reproduced below:-

"Please refer to paragraph 19 of our Master Circular DBOD Dir.BC.6/13.03.00/2006-07

dated July 1,2006 on Interest Rates on Deposits', in terms of which banks were advised
that all transactions, including payment of interest on deposits/charging of interest an
advances, should be rounded off to the nearest rupee; i.e., fractions of 50 paise and above
shall be rounded off to the next higher rupee and fraction of less than 50 paise shall be
ignored. It was also advised that issue prices of cash certificates should also be rounded
off in the same manner. Banks were however, advised that cheques issued by clients
containing fractions of a rupee should not be rejected or dishonoured."
In the Customer Service Guidelines During the year 2006-2007, issued by the Customer
Service Department, Reserve Bank of India, Clause A.5 mentioning rounding off cheques
to the nearest Rupee, is reproduced below:-

"As per extant instructions (contained in Master circular DBOD Dir.BC.6/13.03.00/2006-

07 dated July 1, 2006 on Interest Rates on Deposits'), banks are required that all
transactions, including payment of interest on deposits/charging of interest on advances,
should be rounded off to the nearest rupee; i.e., fractions of 50 paise and above shall be
rounded off to the next higher rupee and fraction of less than 50 paise shall be ignored. It
was also advised that issue prices of cash certificates should also be rounded off in the
same manner. Banks were however, required that cheques issued by clients containing
fractions of a rupee should not be rejected or dishonoured."

Not only this, 'Handbook of Market Practices issued by Fixed Income Money Market and
Derivatives Association of India' for rounding off transaction is followed and
applied.Clause 4.11, which provides for rounding off is reproduced below:-

"All interest receivable/payable should be rounded off ot the higher rupee if the paise
component is equal to or higher than 50 paise and should be ignored if the paise
component is less than 50 paise.

The rounding off of paise should also be done in respect of broken period interest
receivable payable."

Thus, the Reserve Bank of India, which is regulating the Banks and the Market Leaders,
i.e., Derivatives Association of India, in Commercial Activities the aforesaid practice for
rounding off to the nearest Rupee is uniformly applied.We cannot lose sight of the
aforesaid practice adopted in the Commercial Activities, whether it is Banking, Financial,
Hospitality or Restaurants.The Revisionist had also adopted this practice of rounding off
to the nearest Rupee, which by any stretch of imagination cannot amount to be indulging
in any Unfair Trade Practice or Deficiency in Service.

In the facts and circumstances of the case, we are not going in to the various decisions
cited by the learned Counsel for the Parties.
As we have come to the conclusion that the Revisionist had neither indulged in any
Unfair Trade Practice nor there is any Deficiency in Service, the question of paying any
compensation in the facts of the present case does not arise.The award of compensation is
reduced to 'Nil'.If any amount has been deposited by the Revisionist before this
Commission or before the Fora below, it shall be refunded alongwith accrued interest, if
any, to the Revisionist.However, if the amount or any part of it has been permitted to be
withdrawn by the Complainants taking into consideration the special facts and
circumstances of the case, the Complainants shall not be asked to refund the same.

In view of the foregoing discussions we are of the considered opinion that the State
Commission was not at all justified in upholding the Order passed by the District Forum
and the Orders passed by both the Fora below are liable to be set aside and the
Complaints are to be dismissed.We accordingly allow the Revision Petitions, set aside the
Impugned Orders passed by the State Commission and the District Forum and dismiss the
Complaints.However, the Parties shall bear their own costs.

......................J R.K. AGRAWAL PRESIDENT ...................... DR. S.M. KANTIKAR

MEMBER

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