Skip to main content

Share traders not consumers, rules consumer panel

The state consumer disputes redressal commission has held that compensation cannot be given under the Consumer Protection Act to those involved in sale and purchase of shares, which are commercial transactions.

Relying on several judgments that reiterate the above view, the Goa state consumer disputes redressal commission has reversed the order of the North Goa district consumer forum which awarded damages to a couple, who lost money in share trading through a stock broker.

In its recent order, commission president N A Britto and member Jagdish Prabhudesai observed that, "The Consumer Protection Act is not for entertaining or compensating speculative transactions or losses".

The order follows an appeal by Mumbai-based stock broker India Infoline Limited against an order of the North Goa district consumer forum, which awarded damages to Panaji-resident Vaman Nagesh Usapkar and his wife.

They had claimed that they suffered a loss of 1,72,020 which they sought to recover from the stockbroker after filing a complaint on December 30, 2009.

In fact, the Usapkars held the Goa representatives of India Infoline - the branch manager and the relationship manager - who traded on their behalf, responsible for their loss.

In its order dated October 18, 2012, two members of the district forum held the complainants to be consumers and awarded to them a sum of 1,72,020 towards the loss with interest at the rate of 18% from December 30, 2009, till payment and also compensation of 50,000 besides awarding costs of 15,000. But the third member of the forum dissented and held that the complainants were not consumers and that their case was liable to be dismissed.

During the hearing, the counsel for the Usapkars argued that the stockbroker's representatives did the transactions without his clients' consent.

He also argued that Vaman Usapkar is 'in service' and therefore any investment by him could not be commercial.

But the stockbroker's advocate submitted that the Usapkars had given their occupation as "business" and that they had entered into an agreement with the stockbroker for trading in shares which is a commercial activity.

But the Goa consumer commission ruled that the Usapkars did not fall within the purview of consumers under section 2(d)(ii) of the Consumer Protection Act, 1986.

Comment:

There still remains some ambiguity in the definition. A person buys a property intending to stay. But later sells that. Is that a commercial transaction ? Actually, there are many facets to this. It would have to be seen why did he sell and did he buy another again ? So each case has to be treated individually which is why though judgment on share trading have been given several times in the past, they are admitted by the court and heard.

 Article referred: http://timesofindia.indiatimes.com/City/Goa/Share-traders-not-consumers-rules-consumer-panel/articleshow/34016076.cms

Comments

Post a Comment

Most viewed this month

Appellate authorities under Special Statutes cannot be asked to condone delay

Madras High Court in R.Gowrishankar vs. The Commissioner of Service Tax has held that Appellate authorities cannot be asked to condone the delay, beyond the extended period of limitation A Division Bench comprising of Justices S. Manikumar and D. Krishnakumar, made this observation while considering an appeal filed against Single Bench order declining to set aside the order made in the condone delay petition filed by the petitioner to condone 223 days in filing the appeal before the Commissioner of Service Tax (Appeals). Article referred: http://www.livelaw.in/appellate-authorities-special-statutes-cannot-asked-condone-delay-beyond-extended-period-limitation-madras-hc/
Post a Comment
Read more

'Seize assets to pay damages to accident victim'

Her story might be an inspiration for the physically challenged but justice has remained elusive for her. In 2008, a bus accident left research engineer S Thenmozhi, 30, paraplegic. In April 2013, the motor accident claims tribunal directed the Tamil Nadu State Transport Corporation (TNSTC) to provide her a compensation of 57.9 lakh. However, TNSTC refused to budge and on Tuesday a city court ordered attaching of movable assets of the transport corporation. Thenmozhi was employed in C-DOT, a telecom technology development centre in Bangalore. On July 21, 2008, she was coming to Chennai in a private bus. Around 2am, the bus had a flat tyre and the driver parked it on the left side of the road near Pallikonda in Vellore district on the Bangalore-Chennai highway. While the tyre was being changed, a TNSTC bus of Dharmapuri division hit the stationary bus. The rear part of the bus was smashed and passengers were injured. Thenmozhi who had a seat at the back of the bus suffered...
Post a Comment
Read more

Mumbai ITAT rules income of offshore discretionary trust is subject to tax in India

The Mumbai Income Tax Appellate Tribunal (ITAT) has recently determined the following issue in the affirmative in the case of Manoj Dhupelia: Should the income of an offshore discretionary trust be subject to tax in India, if no distributions have been made to beneficiaries in India? The question arose from appeals filed by individual beneficiaries in relation to a Lichtenstein-based trust, the Ambrunova Trust and Merlyn Management SA (the Trust) with the ITAT. It is important to note that the individuals in this case were amongst those first identified by the Government of India (GOI) as holding undeclared bank accounts in Lichtenstein. The ITAT ruling raises the following issues: Taxation of Trust Corpus: ITAT classified the corpus of the trust as "undisclosed income" and declared it taxable in the hands of the beneficiaries. Taxation of Undistributed Income: ITAT refused to draw a distinction between the corpus and undistributed income from the trust and declared i...
Post a Comment
Read more