Buyer Not A ‘Consumer’ If Car Purchased In Proprietorship’s Name For Commercial Use: Commission
Pranav B Prem
The District Consumer Disputes Redressal Commission, Chandigarh, comprising Amrinder Singh Sidhu (President) and Brij Mohan Sharma (Member), has dismissed a consumer complaint against Mercedes-Benz India Pvt. Ltd. and its authorised dealer, holding that a car purchased in the name of a proprietorship concern engaged in commercial activity does not fall within the definition of “consumer” under the Consumer Protection Act, 2019.
The complainant, Rajeev Goyal, proprietor of RLCR Super Market, had purchased a Mercedes E-220 d Expression on 13 June 2019 from the authorised dealer. It was alleged that despite limited usage, the vehicle developed recurring mechanical and electrical defects, particularly in the front left door, including issues with the soft-close motor, window mechanism, door lock and other electrical components. Defects were also alleged with respect to the sunroof and battery. The complainant claimed that repeated visits were required to the dealer’s service centre and certain parts were replaced under warranty.
It was contended that the defects continued to recur despite minimal usage and indicated inherent manufacturing defects. After sending an email to the opposite parties without receiving a satisfactory response, the complainant approached the Consumer Commission seeking replacement of the car or extension of warranty, along with compensation and litigation costs.
The manufacturer contended that it had no direct role in the sale or after-sales service of the vehicle, as it maintained a principal-to-principal relationship with the authorised dealer. It was further submitted that all reported issues were attended to under warranty and the alleged defects were operational in nature due to normal wear and tear, and not manufacturing defects.
The dealer also denied any deficiency in service, stating that the vehicle was serviced as per schedule and the complained-of parts were replaced under warranty. It asserted that there was no recurring defect and that the vehicle was in proper running condition.
Before examining the merits, the Commission considered the preliminary issue of whether the complainant qualified as a “consumer” under Section 2(7) of the Consumer Protection Act, 2019. It noted that the car was purchased in the name of the proprietorship concern, RLCR Super Market, and the complainant himself admitted that he ran a grocery business.
The Commission observed that a proprietorship concern has no separate legal identity from its proprietor, and any asset purchased in the name of such concern is deemed to be for business or commercial activities unless proved otherwise. It further noted that the complainant had neither pleaded nor proved that the car was purchased exclusively for personal use or for earning livelihood by means of self-employment.
Relying on Section 2(7) of the Consumer Protection Act, 2019 and settled law laid down by the Supreme Court, the Commission held that a person purchasing goods for a commercial purpose does not fall within the definition of “consumer” unless the self-employment exception is established. In the present case, the burden lay on the complainant, and no evidence was produced to show that the purchase fell within the exception.
The Commission therefore held that the complaint was not maintainable under the Act. Without examining the merits of the alleged defects or deficiency in service, it dismissed the complaint while granting liberty to the complainant to seek appropriate relief before a civil court or other competent forum in accordance with law.
Cause Title: Rajeev Goyal v. Mercedes-Benz India Pvt. Ltd. & Anr.
Case No: CC 364 of 2021
Coram: Amrinder Singh Sidhu (President) and Brij Mohan Sharma (Member)
