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PETITIONER: KALPAVRUKSHA CHARITABLE TRUST

       Vs.

RESPONDENT: TOSHNIWAL BROTHERS (BOMBAY)

DATE OF JUDGMENT:       12/10/1999

BENCH: S.Saghir Ahmad, R.P.Sethi

JUDGMENT:

     S.  SAGHIR AHMAD, J.

     This  appeal  was  disposed of by us by  our  judgment dated 12th August, 1999.

     Mr.   R.N.   Keswani,  appearing  on  behalf  of   the appellant, has filed the instant Application stating that he was the only counsel appearing on behalf of the appellant on 12.8.1999,  but  since he was busy in some other Court  when the  matter was taken up by us, he could not come and  argue the appeal.  He also stated that the counsel who was deputed to  make a mention that he (Mr.  R.N.  Keswani) was busy  in some other Court was not entitled to argue the appeal.

     The  appeal  was heard by us in detail  and  elaborate arguments  were  made on behalf of the appellant  also,  but having  regard  to the fact that Mr.  Keswani was  the  only counsel  in  the  appeal and he has stated  that  the  other counsel  was not entitled to argue the appeal, we have heard Mr.  Keswani as also Mr.  S.P.Mithal.

     The  main reliance on behalf of the appellant has been placed  on  the decision of this Court in Laxmi  Engineering Works  vs.  P.S.G.  Industrial Institute (1995) 3 SCC 583 in support  of  the  contention  that   the  appellant  was   a "consumer"  within the meaning of the definition set out  in the  Consumer  Protection  Act, 1986.   The  definition  was considered by us and it was held that since the machinery in question  was  installed  by the  appellant  for  commercial purpose, it would not be a "consumer".

     It  is contended by the counsel for the appellant that the  term  "commercial purpose" has been considered by  this Court in the case of Laxmi Engineering Works (supra) and the observation of National Commission that "commercial purpose" would  mean  "profit-making activity on a large  scale"  was approved  and,  therefore,  the   activity  of  the  present appellant   would  not  be  a  commercial  activity  as   no "profit-making  on  a large scale" is involved.  We  do  not

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agree.  This Court in that decision had further held in para 21 as under :

     "21.  We must, therefore, hold that :

     (i)  The explanation added by the Consumer  Protection (Amendment)  Act 50 of 1993 (replacing Ordinance 24 of 1993) with  effect  from 18.6.1993 is clarificatory in nature  and applies to all pending proceedings.

     (ii) Whether the purpose for which a person has bought goods  is  a "commercial purpose" within the meaning of  the definition  of expression ’consumer’ in Section 2(d) of  the Act  is always a question of fact to be decided in the facts and circumstances of each case.

     (iii)  A person who buys goods and uses them  himself, exclusively  for  the purpose of earning his livelihood,  by means  of  self-employment is within the definition  of  the expression ’consumer’."

     Applying  those tests, the Court in the case of  Laxmi Engineering  Works (supra) held that the appellant was not a ‘consumer’  as the machinery in that case were not purchased for  self-employment,  but  were purchased  for  "commercial purposes."

     It  is,  therefore,  clear  that   in  spite  of   the commercial  activity, whether a person would fall within the definition  of "consumer" or not would be a question of fact in  every case.  The National Commission had already held on the  basis of the evidence on record that the appellant  was not  a  "consumer"  as  the   machinery  was  installed  for "commercial  purpose".   We  have  been  again  referred  to various   documents,  including   the  "Project   document", submitted  by the appellant itself to the Bank for a loan to enable  it  to  purchase the machinery in question,  but  we could not persuade ourselves to take a different view.

     Learned counsel for the appellant then referred to the case  of  Addl.   Commissioner of Income  Tax,  Gujarat  vs. Surat  Art  Silk Cloth Manufacturers Association (1980)  121 ITR  1  wherein  the activity of a  charitable  institution, though  commercial  in nature, was held to be a part of  the charitable  activity.   This  decision  does  not  help  the appellant as it was a decision rendered under the Income Tax Act  and the question which we are considering here had  not arisen in that case.

     Learned counsel for the appellant then referred to the decision  of  this Court in Commissioner of Income Tax,  New Delhi  vs.   Federation  of Indian Chambers  of  Commerce  & Industries,  New Delhi, 1981 (3) SCR 489, and contended that if  the  dominant  object  of the trust  or  institution  is charitable,  the  activity  carried on by it  would  not  be treated  as an activity for profit.  It is contended on  the basis  of the above decision that the activities carried  on by the appellant were not profit- oriented nor was there any intention  or  object to carry on those activities  to  earn profit.   This  again  was the decision rendered  under  the Income  Tax  Act  and is not on the point  involved  in  the present  case whether the appellant was a "consumer"  within

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the meaning of the Consumer Protection Act, 1986.

     In  the  instant  case, what is to  be  considered  is whether the appellant was a "consumer" within the meaning of the  Consumer Protection Act, 1986, and whether the goods in question  were  obtained  by him for "re-sale"  or  for  any "commercial  purpose".  It is the case of the appellant that every  patient  who is referred to the Diagnostic Centre  of the  appellant  and who takes advantage of the CT Scan  etc. has  to pay for it and the service rendered by the appellant is not free.  It is also the case of the appellant that only ten  per  cent  of the patients are provided  free  service. That  being so, the "goods" (machinery) which were  obtained by the appellant were being used for "commercial purpose".

     No  other point was pressed before us.  We, therefore, maintain  our  judgment dated 12th August, 1999  even  after having heard Mr.  Keswani who insisted for a hearing through this  Application.   The  Application shall  be  treated  as disposed of.