Notice Under Order 1 Rule 8(2) CPC Mandatory For Filing ‘Class Action’ Consumer Complaints U/s 12(1)(c) of Consumer Protection Act: SC [Read Judgment]

“The expression “with the permission of the District Forum” as appearing in Section 12(1)(c) must be read along with Section 13(6) which provides the context and effect to said expression. In our view Sections 12(1)(c) and 13(6) are not independent but are to be read together and they form part of the same machinery”

The Supreme Court on Friday observed that ‘Class Action’ consumer complaints filed by one or more consumers where there are numerous consumers having the same interest will be maintainable only where the complaint fulfils all the requisite conditions in terms of Section 12(1) (c) of the Consumer Protection Act read with Order I Rule 8 of the Code of Civil Procedure.

In this case (Rameshwar Prasad Shrivastava vs. Dwarkadhis Projects Pvt. Ltd.), the National Consumer Disputes Redressal Commission, relying on its full bench decision in Ambrish Kumar Shukla and others v. Ferrous Infrastructure Pvt. Ltd., dismissed the complaint filed by some of the allottees, as not maintainable since there was no application under Section 12(1)(c) of the Act as held in the full bench decision.

In Ambrish Kumar Shukla, the full bench made this observation: “We would like to emphasise that considering the binding effect of a decision rendered in a complaint under Section 12(1)(c) of the Consumer Protection Act, on all the consumers, on whose behalf or for whose benefit such a complaint is filed, even if they chose not to join as a party to the complaint, it is necessary to exercise due care and caution while considering such a complaint even at the initial stage and to grant the requisite permission, only where the complaint fulfils all the requisite conditions in terms of Section 12(1)(c) of the Consumer Protection Act read with Order I Rule 8 of the Code of Civil Procedure; as interpreted in this reference. It would also be necessary for the Bench to either give individual notices or an adequate public notice of the institution of the complaint to all the persons on whose behalf or for whose benefit the complaint is instituted. Such a notice should disclose inter­alia (i) the subject matter of the complaint including the particulars of the project if the complaint relates to a housing project / scheme, (ii) the class of persons on whose behalf or for whose benefit the complaint is filed, (iii) the common grievance sought to get redressed through the class action, (iv) the alleged deficiency in the services and (v) the reliefs claimed in the complaint.”

Before the apex court, Advocate Priyanjali Singh, who appeared for the complainants-allottees, contended that the definition of the complainant as found in Section 2(1)(b) permits even a voluntary consumer association to espouse the cause of  aggrieved party/parties and that the expression “one or more consumers, where there are numerous consumers having the same interest” ought to be given widest possible interpretation so as to sub-serve the underlying objectives of the Act and to make the redressal mechanism easy, cost effective and efficacious. She submitted that in cases having large number of apartment holders, if only some of them approach the consumer forum, their grievance redressal ought not to be forced to go through the mechanics of Section 13(6) of the Act read with the provisions of Order 1 Rule 8 CPC, as any such insistence would render the remedy exorbitant as cost required for newspaper publication itself would be quite prohibitive.

Rejecting the said submission, the bench comprising Justice Uday Umesh Lalit and Justice R. Subhash Reddy observed that the language used and the text in Section 13(6) is clear that wherever a complaint is filed by a complainant in the category referred to in Section 2(1)(b)(iv), the provisions of Order 1 Rule 8 CPC shall apply with the modification that reference to suit or decree shall be construed as reference to a complaint or order of the district forum.

It said: “If we accept the submission of the appellants, the category of persons referred to in Section 13(6) of the Act, with the aid of requisite permission in terms of Order I Rule 8 of the CPC could maintain a class action which may bind similarly placed consumers but those referred to in Section 12(1)(c) would be a different category who would not be bound by the provisions of Order I Rule 8 of CPC. In essence a separate category of persons as consumer/consumers would be entitled to maintain an action under Section 12(1)(c) of the Act. In our considered view that certainly is not the intent. If we accept the submission, we would be going against the express mandate of the statute. All that such interpretation would help achieve for some consumers is to maintain an action in a forum with higher pecuniary jurisdiction where, but for such collective cause of action, the action would not lie in such forum with higher pecuniary jurisdiction.”

The bench also held that the view taken by the National Commission in the case of Ambrish Kumar is consistent with the text of the provisions and is the correct view. It said: “The language used and the text in Section 13(6) is clear that wherever a complaint is filed by a complainant in the category referred to in Section 2(1)(b)(iv), the provisions of Order 1 Rule 8 CPC shall apply with the modification that reference to suit or decree shall be construed as reference to a complaint or order of the District Forum. The expression “with the permission of the District Forum” as appearing in Section 12(1)(c) must be read along with Section 13(6) which provides the context and effect to said expression. In our view Sections 12(1)(c) and 13(6) are not independent but are to be read together and they form part of the same machinery.”

Taking into consideration that matters were pending with the National Commission for more than three years during which time the pleadings were exchanged and the evidence was filed, the bench allowed the complainants to approach state forum, and in that event, it said that the district forum shall proceed with the matter on the strength of same pleadings and the evidence laid before the National Commission.