Report From Expert Organization Must Be Obtained To Establish Defect: NCDRC

Brief Facts of the Case

The complainant purchased a Honda Civic car from the Honda Cars India/dealer for Rs. 13,20,003. The car was involved in an accident, resulting in damage to the front portion and injuries to the complainant's left arm and shoulder, which required medical treatment costing Rs 40,000. The complainant filed a Consumer Complaint with the State Commission seeking compensation. The complainant argued that the safety airbags in the car failed to deploy despite the severe impact, attributing this to a manufacturing defect. After inspecting the car, the dealer explained that the external impact on the upper front caused the car to decelerate gradually, and the conditions necessary for the airbags to deploy were not met. The State Commission found no expert opinion to support the dealer's claim that the seat belt was a necessary condition for airbag deployment. Additionally, newspaper reports indicated that Honda had recalled approximately 58,000 cars due to airbag defects. While the insurance claim of Rs 1,60,000 had been received, the complainant's claim of Rs 43,50,000 as compensation and Rs 25,000 in costs was deemed unjustified. The Commission awarded Rs 1,00,000 in compensation and Rs 25,000 in litigation costs, to be paid within two months, with an interest rate of 9% annually until realization. Aggrieved by the State Commission's order, the dealer filed an appeal before the National Commission.

Contentions of the Opposite Party

The dealer argued that the complainant did not claim a manufacturing defect, so the manufacturer couldn't be held liable without proof. The complainant's opinion from the Western India Automobile Association didn't qualify as an 'Expert Opinion' and didn't indicate a defect. The dealer stated the accident was a non-frontal collision near the SRS sensors, so the airbags didn't deploy, as the conditions in the car's Manual weren't met. They cited case laws requiring a technical expert's report to establish a manufacturing defect when airbags fail to deploy.

Observations by the Commission

The Commission observed that the main issue in this case was whether the non-deployment of the airbags constituted a manufacturing defect, warranting punitive damages as claimed by the complainant. The Consumer Protection Act 1986 requires establishing a 'deficiency' under Section 13 and, if proven, provides for remedies/compensation under Section 14. An expert opinion from an 'appropriate laboratory' is mandated, defined in Section 2 (1) (a) as recognized by the Central or State Government or established by law for testing goods for defects. Furthermore, Section 13(1)(c) specifies that if a complaint alleges a defect that requires proper analysis or testing, the District Forum must obtain a sample and refer it to an appropriate laboratory for analysis. Section 14(1) states that if the District Forum finds defects in the goods after analysis, it can order remedies. The commission highlighted that for a Consumer Forum to establish a defect, it must obtain a report from an expert organization, which was not followed in this case. The Commission observed that the Western India Automobile Association's report is not considered an 'expert opinion' as it is not an 'appropriate laboratory' and does not analyze the airbag failure per the Manual and accident specifics. Therefore, the State Commission's finding of a defect is unsustainable.

The Commission emphasized that the State Commission's decision for compensation was partly based on the insurance payment of Rs 1,60,000 and the absence of evidence that wearing a seat belt was necessary for airbag deployment. However, the determination of a manufacturing defect by the State Commission was not properly established under Section 13(1)(a) and the required compensation under Section 14 lacked factual or legal backing.

The National Commission allowed the appeal and set aside the order by the State Commission ruling the dealer not being deficient in service.

Case Title: Honda Cars India Ltd. Vs. Ushat Gulgule

Case Number: F. A. No. 1054/2016