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Consumer court - No penalty unless asked for it

The Supreme Court has stated that a consumer court cannot impose penal compensation when the aggrieved person did not ask for it. In this case, General Motors vs Ashok Ramnik, the National Consumer Commission imposed compensation on the car manufacturer for selling its vehicles as SUV to 260 customers though the model did not qualify for that description. Ashok had a dream to drive in a sports model vehicle to the high hills. The brochure of General Motors promised exactly that. So he bought a Chevrolet Forester model for Rs 14 lakh in 2004. But he was disappointed on several fronts and sued the firm for unfair trade practices like promising facilities which were not available. The district consumer forum asked the firm to return the money with costs of litigation and Rs 5,000 for mental agony. The firm appealed to the State Consumer Commission, which found that it was not a SUV as was described in the brochures. So it asked the manufacturer to correct its claims in future ads. When the appeal was taken to the National Commission, it imposed Rs 25 lakh compensation on the firm in the nature of punishment for unfair trade practice. Rs 20 lakh would go to the consumer welfare fund of the government, the commission ordered. General Motors appealed to the Supreme Court. It ruled that the National Commission had gone beyond its powers by imposing punitive damages, when the affected party did not ask for it.

 Article referred: http://www.business-standard.com/article/opinion/more-sc-rules-on-bouncing-cheques-114101900726_1.html

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