Regular trading in the sale and purchase of shares is a purely commercial activity and the only motive is to earn profits. Therefore, this activity being purely commercial one, is not covered under the provisions of the Act.
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
( REVISION PETITION NO.3060 OF 2011 – Against the order dated 25.5.2011 in Appeal No.603 of 2009 of the State Commission, Andhra Pradesh )
M/s. Steel City Securities Ltd.
PG Road, Secunderabad, AP
Through its Manager … Petitioner
Versus
1. Shri G.P. Ramesh
Madhuranagar
S.R. Nagar, Hyderabad
A.P.
2. Smt. Padma G.
Madhuranagar
S.R. Nagar, Hyderabad
A.P. …Respondents
BEFORE:
HON’BLE MR. JUSTICE V. B. GUPTA, PRESIDING MEMBER
HON’BLE MRS. REKHA GUPTA, MEMBER
Pronounced on: 3rd February, 2014
ORDER
PER MR. JUSTICE V.B. GUPTA, PRESIDING MEMBER
1. Present revision petition has been filed by the Petitioner/Opposite Party under Section 21(b) of Consumer Protection Act, 1986 (for short, ‘Act’) challenging the impugned order dated 25.5.2011 passed in F.A. No. 603 of 2009 by Andhra Pradesh State Consumer Disputes Redressal Commission, Hyderabad (for short, ‘State Commission’).
2. Respondents/Complainants, filed a consumer complaint under Section 12 of the Act on the allegation that they are husband and wife and they are transacting shares with the petitioner through their Client ID No.1202230000004809 with OPID No.22300 and client I.D. No.1202230000005023 with DPID No.22300 respectively. On 24.01.2008, respondent no.1 parked his Scooter in front of a shop to purchase a refill. After he came out he found that his Rexene box was missing which was hanged to his scooter. The said bag contained blank signed depository participant slip books of himself and of respondent no.2. Thereafter, he immediately informed the said incident over phone to the petitioner and requested it not to allow any transactions on the said depository participant slips. The petitioner advised him to lodge a police complaint and enclose the same alongwith his representation for their record purpose. Petitioner also assured him that they will not allow any transaction on the said depository participant slips which were lost. Accordingly, respondent no.1 lodged a complaint before the S.R. Nagar, Police on the same day i.e. on 24.01.2008. The police authorities after investigation issued a certificate on 30.01.2008 stating that efforts were made to trace the above slips but all are in vain. Then, respondent no.1 submitted a written representation to the petitioner on 30.01.2008 along with the copy of the police complaint and requested them to issue new DPID books. However, there was no response. Later on, respondents came to know that petitioner sold the shares worth Rs.11,768.37/- dated 29.01.2008 and Rs.1,78,661.69 respectively, belonging to the respondent No.2. In spite of the assurance that petitioner will not transact till new books are issued, the petitioner sold the shares which is unfair and hence it is bound to reimburse the same, Since there no response, the respondent sought reimbursement of a sum of Rs.1,78,661.69 and Rs.11,768.37 with interest @ 18% per annum from 29.01.2008 till date of payment to respondent No.2. Further petitioner to issue new DPID books in favour of respondents, besides Rs.30,000/- each towards compensation and Rs.10,000/- as costs of the complaint.
3. Petitioner filed its counter denying the averments. Further, it denied having advised the respondents to lodge a complaint before the Police. The complaint is not maintainable as there is agreement between them that in case of dispute, they shall approach the Arbitrator. The respondents have failed to show any deficiency of service/unfair trade practice. Lastly, the respondents are not ‘consumers’ since the transactions are commercial in nature.
4. After hearing the parties and going through the record, District Forum held that the petitioner has not committed any deficiency in service nor unfair trade practice and accordingly dismissed the complaint.
5. Aggrieved by the order of District Forum, respondents filed appeal before the State Commission which allowed the appeal and set aside the order passed by the District Forum. It directed the petitioner to reimburse a sum of Rs.1,78,661.69 and Rs.11,768.37 to the second complainant.
6. Now, petitioner has filed the present revision petition.
7. We have heard the learned counsel for the parties and gone through the record.
8. It is an admitted fact that respondents had been indulging in trading of the shares as respondents in their complaint have stated that they are regularly transacting the transactions through the petitioner.
9. Thus, the short question which arise for consideration in the present case is as to whether respondents are ‘consumers’ or not as per Section 2(1)(d) of the Act.
10. Expression ‘consumer’ has been defined in Section 2 (1) (d) of the Act, which reads as under;
“d “Consumer” means any person who,—
(i) buys any goods 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 user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
(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 purpose;
Explanation—— For the purpose 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”.
11. Respondents have nowhere pleaded in their complaint that they are doing the share trading business for self-employment nor it has been pleaded that the services provided by the petitioner are being availed exclusively for the purpose of earning their livelihood by means of self-employment. It is well settled that the dispute between the parties relating to commercial purposes are excluded under the Act.
12. This Commission in Vijay Kumar Vs. Indusind Bank, II (2012) CPJ 181 (NC) has held;
“Since, petitioner has been trading regularly in the shares which is a commercial transaction and for which he has also availed the “over draft facility” from the respondent, as such he would not be a consumer as per Section 2 (1) (d) (ii) of the Act. Moreover, regular trading in the purchase and sale of the shares is a commercial transaction and the only motive is to earn profit. Thus, this activity is purely commercial one and is not covered under the Act”.
13. Since, respondents are trading regularly in the share business which is commercial activity, under these circumstances, respondents would not fall under the definition of ‘consumer’ as per the Act. Moreover, regular trading in the sale and purchase of shares is a purely commercial activity and the only motive is to earn profits. Therefore, this activity being purely commercial one, is not covered under the provisions of the Act.
14. Accordingly, we hold that since respondents are not the ‘consumers’ as per provisions of the Act, the State Commission committed grave error in allowing their complaint. Consequently, we allow the present revision petition and set aside the impugned order passed by the State Commission and restore the order of the District Forum. With the result, the complaint filed by the respondents before the District Forum shall stand dismissed.
15. With these observations, the present revision petition stand disposed of.
16. No order as to cost.
…………………………………….
(V.B. GUPTA)
PRESIDING MEMBER
……………………………………………
(REKHA GUPTA)
Sg. MEMBER