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CASE NO.: Appeal (civil)  3734 of 2000

PETITIONER: Maruti Udyog Ltd

RESPONDENT: Susheel Kumar Gabgotra & Anr

DATE OF JUDGMENT: 29/03/2006

BENCH: ARIJIT PASAYAT & TARUN CHATTERJEE

JUDGMENT: J U D G M E N T

ARIJIT PASAYAT, J.

Challenge in this appeal is to the judgment rendered by a  Division Bench of the J & K High Court at Jammu dismissing  the appeal filed by the appellant under Section 17 of the J&K  Consumers Protection Act, 1988 (in short the ’Act’).  Challenge  in the said  appeal was to the order dated 9.11.1998 passed by  the J&K State Consumer Redressal Commission (in short the  ’Commission’) on a complaint filed by respondent no.1.  In the  complaint appellant and respondent no.2 were impleaded as  the opposite parties.   

The factual background in a nutshell is as follows:

Respondent-complainant filed a compliant before the  Commission seeking a direction to the appellant herein to take  back the Maruti car back and repay an amount of  Rs.1,97,460.37 being the cost of the car supplied to him, along  with interest at the rate of 18 per cent with effect from  27.11.1996, as the car was defective.  He also sought  compensation for the loss at his place of work and coaching  charges approximately Rs.60,000/-; Rs.1,00,000/- towards  mental agony, physical deterioration and emotional stress,  Rs.15,000/- for his trip to Karnal on the mistaken direction of  the appellant and also Rs.2,500/- towards the costs of  litigation and legal consultation.

Respondent No.1 complainant had purchased a Maruti  Car on 27.11.1996 from the appellant through its authorized  dealer, respondent No.2 herein, on payment of Rs.1,97,460.37  as sale price.  After delivery of the car, the complainant  noticed that the clutch of the car was not functioning properly  as it developed unusual noise/jerks on running of the engine.   The defect was brought to the notice of respondent No.2,  whose engineer after examining the defect told the  complainant that the clutch is behaving erratically because of  the new engine and it will automatically adjust/become defect- free after covering some mileage. But it did not happen that  way and on the other hand problem increased. He again  reported to respondent No.2 whereupon he was assured that  the defect will disappear after the first service which was done  on 19.12.1996. But the defect continued. The complainant  again approached respondent No.2 and was told that the

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engine will have to be brought down to locate the trouble  which the engineers failed to pin point.  The complainant  objected to it as the defect had developed within the warranty  period and approached the Head Office (Marketing) of the  appellant at Gurgaon.  He wrote letter dated 19.2.1997  bringing to the appellant’s notice about the inherent  manufacturing defect in the car and requested for its  replacement. The appellant vide its letter dated 5.3.1997,  advised the complainant to take the car to Modern  Automobiles, Karnal, for getting the needful done.  He took the  car to Karnal on 10.3.1997.  But the said concern did not test  the vehicle on the ground that the same had been delivered by  respondent No.2 who was responsible and can repair the  vehicle. The complainant came back to Jammu.  On 13.3.1997  the appellant conceded to have wrongly advised the  complainant to take the car to Karnal and asked him to again  approach respondent No.2 at Jammu.  On 21.3.1997 Mr. H.S.  Chahal, Senior Engineer, Regional Office, Chandigarh,  examined the car but the defect could not be removed which  continued to give trouble.  The matter was again reported to  the appellant and the complainant again visited respondent  No.2 on 17.4.1997 but had to return with persisting defect.   On 21.4.1997 the complainant addressed a letter to the  Chairman-cum-Managing Director of the appellant-company  about the manufacturing defect in the car sold to him and  requested for its replacement.  No reply to the said letter was   received.  The complainant suffered financial loss not only  because of the callous and careless attitude of the appellant  but also on account of the appellant having sold defective car  to the complainant, defects whereof could not be removed  thereby leaving him to face emotional stress, mental agony  and to drive the defective car posing a risk to his life .With  these grievances complainant approached the Commission.

Respondents filed their replies before the  Commission  stating therein that their obligation under the warranty was  only to repair or replace any part found to be defective.  The  appellant and its authorized dealer (Respondent No.2) have  attended to the vehicle during the warranty period free of  charges and had carried out necessary repairs and  replacement of the components on 21.3.1997 to the  satisfaction of the complainant.  The vehicle was again  inspected on 29.5.1997 and the complainant was advised to  leave the vehicle at the workshop of the dealer of the appellant  at Jammu for inspection and carrying out necessary repairs to  which the complainant did not agree.  The correspondence  between the parties has not been denied by the appellant and  their dealer (Respondent No.2).  The appellant has claimed  that it is not under any obligation to take back the Maruti car  or repay the sale price to the complainant.   

The High Court held that the warranty condition relied  upon by the appellant did not warrant interpretation that only  the defective part was to be replaced and not the car itself.   Reference was made to certain observations in the Corpus  Juris Secundrum Volume 77 page 1198.  It was held that the  booklet containing warranty clearly indicates promise of  service and replacement with certain conditions.  It was  observed that the Commission was justified in its conclusion  that the appellant had agreed to replace the vehicle and had  admitted that there was manufacturing defect in the  concerned part.  Reliance was also placed on a decision of this  Court in Tata Engineering & Locomotive Co. Ltd. v. Gajanan Y.  Mandrekar (1997(5) SCC 507). Therefore, the appellant was  directed to replace the car or repay the amount received by it

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as sale price with interest @ 18% p.a. w.e.f. 27.11.1996 with  costs awarded by the Commission.   

In support of the appeal, learned counsel for the  appellant submitted that both the Commission and the High  Court erred in holding that there was an admission to replace  the car and/or admission of any manufacturing defect. The  warranty condition clearly refers to the replacement of the  defective part and not of the car.  Observations made in the  Corpus Juris Secundrum had been read out of context.  It was  stated that at the most the Commission and the High Court  could have asked for the replacement of the defective part or to  pay the cost thereof.   

Learned counsel for the respondent no.1 supported the  orders of the Commission and the High Court.

The obligation under clause (3) of the Manual reads as  under:

"(3) Maruti’s Warranty Obligation:     If any defect(s) should be found in a  Maruti Vehicle within the term  stipulated above, Maruti’s only  obligation is to repair or replace at  its sole discretion any part shown to  be defective with a new part of the  equivalent at no cost to the owner  for parts or labour, when Maruti  acknowledges that such a defect is  attributable to faculty material or  workmanship at the time of  manufacture.  The owner is  responsible for any repair or  replacement which are not covered  by this warranty."

       The Commission and the High Court have relied on so  called admission of the appellant in para 3 of the objections  filed before the Commission.  In various documents, more  particularly letter dated 19.2.1997 written by respondent no.1  to the appellant, it is clearly stated that appellant had  indicated that downing of the engine was necessary to trace  the problem.  There was no agreement to replace the engine  system.  Additionally, it is not disputed by learned counsel for  the respondent no.1 that when appellant had asked the  vehicle to be brought for the aforesaid purpose the respondent  no.1 had not done so.  To infer that there was any  manufacturing defect in the said background is without any  foundation.       

       In Corpus Juris Secundrum the observations to which  reference was made by the High Court read as follows:

"On a sale of a motor vehicle by a  manufacturer to dealer there may be an  implied warranty that it is reasonably fit  for, or adapted to, the uses for which it is  made and sold; and such a warranty is  not excluded by the silence of the  contract of sale as to warranties."                                                       

       The principles stated above can never be doubted.  But  what is relevant in the case at hand is that the warranty  conditions were specially stated.  This is not a case of silence

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of a contract of sale as to warranty.  Therefore, the High Court  was not justified in directing replacement of the vehicle.

But on the peculiar fact of the case relief to the  respondent no.1 has to be moulded.  In almost a similar case  certain directions were given in Jose Phillip Mampillil v.  Premier Automobiles Ltd. (2004 (2) SCC 278).   

       In line with what has been stated in the aforesaid case,  we direct as follows:- (1)     On respondent no.1 taking the vehicle in  question to the authorized service centre of the  appellant at Jammu within three weeks,  the  defective part that is  clutches assembly shall  be replaced.  Respondent no.1 shall not be  required to pay any charge for the  replacement.  2.      In addition, respondent no.1 shall be entitled  to receive a consolidated sum of Rs. 50,000/-  (rupees fifty thousand only) from the appellant  for cost of travel to Karnal which admittedly  was wrongly advised by the appellant, for the  inconvenience caused to respondent no.1 on  account of the acts of the appellant and the  respondent no.2 and the cost of litigation.

       The appeal is allowed to the aforesaid extent. There shall  be no order as to costs.