REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO.4307 OF 2007
Rajeev Hitendra Pathak & Others ... Appellants
Versus
Achyut Kashinath Karekar & Another ... Respondents
WITH
CIVIL APPEAL NO.8155 OF 2001
M.O.H. Leathers ... Appellants
Versus
United Commercial Bank ... Respondents
J U D G M E N T
Dalveer Bhandari, J.
1. These appeals emanate from the order dated 16.11.2005
in Revision Petition No.551 of 2005 and order dated 12.7.2001
in Miscellaneous Petition No.1 of 2001 in Original Petition
No.110 of 1993 passed by the National Consumer Disputes
Redressal Commission, New Delhi.
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2. The main question which arises for consideration is
whether the District Consumer Forums and the State
Commissions have the power to set aside their own ex parte
orders or in other words have the power to recall or review
their own orders?
3. The questions of law involved in both the appeals are
identical, therefore, we deem it appropriate to dispose of both
these appeals by a common judgment.
4. Brief facts necessary to dispose of these appeals are
recapitulated as under:
CIVIL APPEAL NO.4307 OF 2007
5. Smita Achyut Karekar was admitted to Ashirwad Nursing
Home as she was suffering from the ailment of slip disc. The
operation was performed on 8.10.1997. It was noticed, at
about 3.45 pm on that day, that her blood vessels had
ruptured accidentally during the surgery. She was declared
dead at 5.35 pm.
6. The complainants issued a legal notice on 24.7.1999.
Reply to the legal notice was sent on 7.8.1999. The
complainants filed complaint alleging deficiency in service and
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claimed compensation of Rs.15,00,000/-. The complainants
did not take necessary steps to remove objection and to
complete procedure under the Consumer Protection Act, 1986.
The State Commission, Maharashtra issued notice to the
opposite parties/appellants herein on 10.02.2004. On
9.9.2004, the State Commission dismissed the complaint for
want of prosecution. On 04.11.2004, the complainants filed
an application for recalling 9.9.2004 order and consequently
the State Commission recalled the order dated 9.9.2004 and
restored the complaint.
7. The appellants aggrieved by the said order preferred a
Revision Petition No.551 of 2005 before the National
Consumer Disputes Redressal Commission, New Delhi. The
appellants in the revision petition made two main arguments
before the Commission : firstly, that the State Commission did
not have the power to restore the complaint and, secondly,
that the State Commission restored the complaint without
issuing notice to the appellants. The National Commission
dismissed the revision petition which has been challenged by
the appellants before this Court.
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8. The appellants relied on the judgment in the case of
Jyotsana Arvind Kumar Shah & Others v. Bombay
Hospital Trust (1999) 4 SCC 325. In this case, the Court
held that the State Commission did not have the power to
review or recall its ex parte order.
9. In New India Assurance Co. Ltd. v. R. Srinivasan
(2000) 3 SCC 242, this Court took the contrary view and held
that the State Commission could review or recall its ex parte
order.
10. In the instant case, a two-Judge Bench of this Court vide
judgment and order dated 17.9.2007 reported in 2007 (11)
SCALE 166 noted the controversy and observed as under:
"5. In Jyotsana's case it was observed at para 7 as
follows:
"We heard the learned counsel on both
sides for quite some time. When we asked
the learned counsel appearing for the
respondent to point out the provision in
the Act which enables the State
Commission to set aside the reasoned
order passed, though ex parte, he could
not lay his hands on any of the provisions
in the Act. As a matter of fact, before the
State Commission the appellants brought
to its notice the two orders, one passed
by the Bihar State Commission in Court
Master, UCO Bank v. Ram Govind
5
Agarwal 1996 (1) CPR 351 and the other
passed by the National Commission in
Director, Forest Research Institute v.
Sunshine Enterprises 1997 (1) CPR 42
holding that the redressal agencies have
no power to recall or review their ex parte
order. The State Commission had
distinguished the abovesaid orders on the
ground that in those two cases the
opponents had not only not appeared but
also failed to put in their written
statements. In other words, in the case
on hand, according to the State
Commission, the opponent (respondent)
having filed the written statements, the
failure to consider the same by the State
Commission before passing the order
would be a valid ground for setting aside
the ex parte order. The State
Commission, however, fell into an error in
not bearing in mind that the Act under
which it is functioning has not provided it
with any jurisdiction to set aside the ex
parte reasoned order. It is also seen from
the order of the State Commission that it
was influenced by the concluding portion
of the judgment of the Bombay High
Court to the effect that the respondent
(writ petitioner) could approach the
appellate authority or make an
appropriate application before the State
Commission for setting aside the ex parte
order, if permissible under the law. Here
again, the State Commission failed to
appreciate that the observation of the
High Court would help the respondent, if
permissible under the law. If the law does
not permit the respondent to move the
application for setting aside the ex parte
order, which appears to be the position,
the order of the State Commission setting
aside the ex parte order cannot be
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sustained. As stated earlier, there is no
dispute that there is no provision in the
Act enabling the State Commission to set
aside an ex parte order."
6. Subsequently, in New India Assurance case
this Court appears to have taken a different view as
it is evident from what has been stated in para 18,
the same reads as follows:
"We only intend to invoke the spirit of
the principle behind the above dictum in
support of our view that every court or
judicial body or authority, which has a
duty to decide a lis between two parties,
inherently possesses the power to dismiss
a case in default. Where a case is called
up for hearing and the party is not
present, the court or the judicial or
quasi-judicial body is under no obligation
to keep the matter pending before it or to
pursue the matter on behalf of the
complainant who had instituted the
proceedings. That is not the function of
the court or, for that matter of a judicial
or quasi-judicial body. In the absence of
the complainant, therefore, the court will
be well within its jurisdiction to dismiss
the complaint for non-prosecution. So
also, it would have the inherent power
and jurisdiction to restore the complaint
on good cause being shown for the non-
appearance of the complainant."
7. In the latter case i.e. New India Assurance case
reference was not made to the earlier decision in
Jyotsana case. Further the effect of the
amendment to the Act in 2003 whereby Section 22A
was introduced has the effect of conferment of
power of restoration on the National Commission,
but not to the State Commission. In view of the
divergence of views expressed by coordinate
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Benches, we refer the matter to a larger Bench to
consider the question whether the State
Commission has the power to recall the ex parte
order. Records be placed before the Hon'ble Chief
Justice of India for appropriate orders."
11. We have been called upon to decide whether the State
Commission has the power to recall an ex parte order.
12. Shri Siddharth Bhatnagar, learned senior counsel
appearing for the appellants in Civil Appeal No.4307 of 2007
submitted that the Consumer Tribunals set up under the
Consumer Protection Act, 1986 are creatures of that Statute
and derive their powers only from the express provisions of the
Statute. He has drawn our attention to various provisions of
the Consumer Protection Act, 1986 to strengthen his
submission. He referred to Section 13(4) of the Consumer
Protection Act, 1986 which reads as under:
"13 (4) For the purposes of this Section, the District
Forum shall have the same powers as are vested in
a Civil Court under the Code of Civil Procedure,
1908 (5 of 1908), while trying a suit in respect of the
following matters, namely:-
(i) the summoning and enforcing the attendance
of any defendant or witness and examining the
witness on oath;
(ii) the discovery and production of any document
or other material object produced as evidence;
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(iii) the reception of evidence on affidavits;
(iv) the requisitioning of the report of the
concerned analysis or test from the
appropriate laboratory or from any other
relevant source;
(v) issuing of any commission for the examination
of any witness; and
(vi) any other matter which may be prescribed."
13. Mr. Bhatnagar has also drawn our attention to
Regulation 26(1) of the Consumer Protection Regulations,
2005, framed in exercise of powers conferred by Section 30-A
of the Consumer Protection Act, 1986. Regulation 26(1) reads
as follows:
"26. Miscellaneous-- (1) In all proceedings before
the Consumer Forum, endeavour shall be made by
the parties and their counsel to avoid the use of
provisions of Code of Civil Procedure, 1908 (5 of
1908):
Provided that the provisions of the Code of Civil
Procedure, 1908 may be applied which have been
referred to in the Act or in the rules made
thereunder."
14. Mr. Bhatnagar submitted that only very few provisions of
the Code of Civil Procedure have been made applicable to the
proceedings before the District Forums and the State
Commissions under Section 18 of the Consumer Protection
9
Act, which applies Sections 13 and 14 to the State
Commission and the National Commission (under Section
22(1) are those under Section 13(4)). He relied on the
judgment of this Court in Morgan Stanley Mutual Fund v.
Kartick Das (1994) 4 SCC 225 to strengthen his argument
that the consumer tribunals can derive powers only from the
express provisions in the Statute. In the said case, the Court
observed as under:
"44. A careful reading of the above discloses that
there is no power under the Act to grant any interim
relief of (sic or) even an ad interim relief. Only a final
relief could be granted. If the jurisdiction of the
Forum to grant relief is confined to the four clauses
mentioned under Section 14, it passes our
comprehension as to how an interim injunction
could ever be granted disregarding even the balance
of convenience."
15. Mr. Bhatnagar also placed reliance on another judgment
of this Court in Gulzari Lal Agarwal v. Accounts Officer
(1996) 10 SCC 590. In this case, the Court relied on earlier
judgment of this Court in the case of Morgan Stanley Mutual
Fund and observed that the Consumer Forum has no
jurisdiction or power to pass any interim order pending
disposal of the original complaint filed before it.
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16. Mr. Bhatnagar relied on Section 17 of the Act which deals
with the jurisdiction of the State Commission. Sections 17-A
and 17-B were added by the 2002 Amendment of the Act
dealing with the "Transfer of Cases" and "Circuit Benches"
respectively. The objects and reasons for introducing the said
provisions by way of the said amendment were as follows:
"Objects and Reasons-- Clause 15 (old) seeks to
insert a new Section 17-A to empower the State
Commission to transfer a case from one District
Forum to another District Forum within the State if
required for the ends of justice. It also seeks to
insert another new Section 17-B to enable the State
Commissions to hold Circuit Benches."
17. Mr. Bhatnagar also relied on Section 22 of the Act, which
deals with the power and procedure of the National
Commission. Before the 2002 Amendment, the said provision
was as follows:
"22. Power of and procedure applicable to the
National Commission-- The National Commission
shall, in the disposal of any complaints or any
proceedings before it, have--
a) the powers of a Civil Courts as specified in
Sub-Sections (4), (5) and (6) of Section 13;
b) the power to issue an order to the opposite
party directing him to do any one or more of
the things referred to in clauses (a) to (i) of
Sub-Section (1) of Section 14,
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and follow such procedure as may be prescribed by
the Central Government."
18. After the 2002 Amendment, Section 22 of the Act now
reads as follows:
"22. Power and procedure applicable to the
National Commission -- (1) The provisions of
Sections 12, 13 and 14 and the rules made
thereunder for the disposal of complaints by the
District Forum shall, with such modifications as
may be considered necessary by the Commission,
be applicable to the disposal of disputes by the
National Commission.
(2) Without prejudice to the provisions contained in
Sub-Section (1), the National Commission shall
have the power to review any order made by it,
when there is an error apparent on the face of
record."
19. The 2002 Amendment also introduced Section 22A which
reads as follows:
"22A. Power to set aside ex parte orders.-Where
an order is passed by the National Commission ex
parte against the opposite party or a complainant,
as the case may be, the aggrieved party may apply
to the Commission to set aside the said order in the
interest of justice."
20. Mr. Bhatnagar contended that Section 22(2) was
introduced in 2002 to give the National Commission the power
to review its own order. This power could not have been used
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by the Commission before the amendment. After amendment,
now the Commission has specific power to set aside an ex
parte order. This power has only been given to the National
Commission and not extended to the District Forums or the
State Commissions. If the legislature intended to give this
power to the State Commissions and District Forums then it
would have extended the same to those forums also.
21. Mr. Bhatnagar has also drawn our attention to the
objects and reasons for carrying out the amendment which
reads as follows:
"Objects and Reasons-- Clause 21 (old) seeks to
substitute Section 22 so that the provisions of
Sections 12, 13 and 14 and the rules made
thereunder for the disposal of complaints by the
District Forum, shall, with such modifications as
may be considered necessary by the Commission,
be applicable to the disposal of disputes by the
National Commission. It also seeks to empower the
National Commission to review any order made by it
when there is an error apparent on the face of
record. These provisions will make the powers and
procedures in respect of the National Commission
more explicit. It also seeks to insert new Sections
22-A, 22-B and 22-C and 22-D. New Section 22-A
empowers the National Commission to set aside ex
parte orders against the opposite party or
complainant in the interest of justice........"
13
22. Mr. Bhatnagar submitted that the limited applicability of
the provisions of the Civil Procedure Code to the Tribunals
under the Act is under Section 13(4) of the Act. There is no
power of review or recall under the said provision. Even under
Section 13(4)(vi), no Rule has been framed in terms of Section
30(1) by the Central Government which provides power to
review or recall of orders.
23. Learned senior counsel for the appellants also relied on
M/s Eureka Estates (P) Ltd. v. A.P. State Consumer
Disputes Redressal Commission and Others AIR 2005 AP
118 in which the Court observed that the District Forums and
the State Commissions are entitled to exercise only such
powers which are specifically vested in them under the Act
and the Rules.
24. Mr. Bhatnagar submitted that it is evident from the
Statement of Objects and Reasons of the Act that the purpose
of the Act is to provide speedy and simple redressal to
consumer disputes. It is for this reason that all the provisions
of the Civil Procedure Code have not been extended to the
Consumer Forums.
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25. Mr. Bhatnagar further submitted that the salutary object
of speedy and simple redressal under the Act is to be found
inter alia in Sections 13(2) and (3) of the Act which provide for
the procedure to be adopted by the forum in deciding the
complaints admitted by it. The said provisions read as follows:
13. (2) The District Forum shall, if the complaints
admitted by it under Section 12 relates to goods in
respect of which the procedure specified in Sub-
Section (1) cannot be followed, or if the complaint
relates to any services,--
(a) refer a copy of such complaint to the opposite
party directing him to give his version of the case
within a period of thirty days or such extended
period not exceeding fifteen days as may be
granted by the District Forum;
(b) where the opposite party, on receipt of a copy of
the complaint, referred to him under clause (a)
denies or disputes the allegations contained in
the complaint, or omits or fails to take any action
to represent his case within the time given by the
District Forum, the District Forum shall proceed
to settle the consumer dispute,--
(i) on the basis of evidence brought to its
notice by the complainant and the
opposite party, where the opposite party
denies or disputes the allegations
contained in the complaint, or
(ii) ex parte on the basis of evidence brought
to its notice by the complainant where
the opposite party omits or fails to take
any action to represent his case within
the time given by the Forum.
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(c) where the complainant fails to appear on the
date of hearing before the District Forum, the
District Forum may either dismiss the
complaint for default or decide it on merits.
(3) No proceedings complying with the procedure
laid down in Sub-Sections (1) and (2) shall be called
in question in any court on the ground that the
principles of natural justice have not been complied
with."
26. Mr. Bhatnagar also relied on Section 12(3) of the Act
which reads as follows:
"12(3) On receipt of a complaint made under
Sub-Section (1), the District Forum may, by order,
allow the complaint to be proceeded with or
rejected:
Provided that a complaint shall not be rejected
under this Sub-Section unless an opportunity of
being heard has been given to the complainant:
Provided further that the admissibility of the
complaint shall ordinarily be decided within twenty-
one days from the date on which the complaint was
received."
27. Mr. Bhatnagar tried to explain the legislative intent
behind introducing Section 22-A. According to him, only the
National Commission has been given power to set aside ex
parte orders and the same power has not been extended to the
District Forums or the State Commissions because against the
orders of the District Forums and the State Commissions,
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appeal or revision can be filed before the State Commission
and the National Commission respectively. But in the case of
the orders of the National Commission, prior to the
amendment, the parties were compelled to approach this
Court even against the orders by which the cases were
dismissed in default. It became extremely expensive and time
consuming. In this view of the matter, it became imperative to
give this power to the National Commission.
28. According to the counsel for the appellants, in New
India Assurance Co. Ltd., this Court did not notice the
earlier decision in Jyotsana's case. He submitted that the
Tribunals constituted under the Consumer Protection Act,
1986 exercise only such powers as are expressly conferred by
the provisions of the said Act and Rules framed thereunder.
Since no power of review and recall was conferred on the
District Forums and the State Commissions, they can exercise
no such power.
29. The counter affidavit was filed by the respondents stating
that the Commission was justified in setting aside the ex parte
17
order and restoring the respondents' complaint. The counter
affidavit also states that the respondents cannot be deprived
of their right without contest on the basis of trivial
technicalities.
30. The respondents relied upon the judgment of this Court
in New India Assurance Co. Ltd. in which this Court held
that the Consumer Courts have inherent powers to restore the
complaints dismissed for default. It is also stated in the
counter affidavit that due to old age, respondent no.1 lost
track of the case and therefore, the State Commission was
justified in setting aside the ex parte order in order to ensure
that justice is done to the parties.
CIVIL APPEAL NO.8155 OF 2001
31. In Civil Appeal No.8155 of 2001, the National
Commission passed an ex parte order and in the appeal
against the order, this Court gave liberty to the appellants to
approach the Commission for setting aside the ex parte order.
Thereafter, an application was filed by the complainants for
review of the order. The Commission vide order dated
12.7.2001 (relied on the judgment of Jyotsana's case)
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dismissed the application. Aggrieved by the said order, the
appellant has filed this appeal.
32. Mr. M.S. Ganesh, learned senior counsel appearing on
behalf of the appellants in Civil Appeal No.8155 of 2001
submitted that the National Commission has implied and
inherent power to recall the order dated 30.5.1996 passed in
Original Petition No.110 of 1993.
33. Mr. Ganesh also submitted that the notice of hearing
sent by the National Commission was never served on the
counsel for the appellants yet the National Commission
proceeded to an ex parte decision on the appellants' complaint
and dismissed it on the ground of limitation.
34. According to Mr. Ganesh, the decision in Jyotsana's
case is manifestly per incuriam. It does not even refer to the
doctrine of implied powers and was not aware of its
applicability. The later decision in New India Assurance Co.
Ltd. is expressly mindful of the doctrine. He submitted that
an external aid to the interpretation of the Consumer
Protection Act, 1986 also reinforces the above construction of
the Act.
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35. We have carefully scrutinized the provisions of the
Consumer Protection Act, 1986. We have also carefully
analyzed the submissions and the cases cited by the learned
counsel for the parties.
36. On careful analysis of the provisions of the Act, it is
abundantly clear that the Tribunals are creatures of the
Statute and derive their power from the express provisions of
the Statute. The District Forums and the State Commissions
have not been given any power to set aside ex parte orders and
power of review and the powers which have not been expressly
given by the Statute cannot be exercised.
37. The legislature chose to give the National Commission
power to review its ex parte orders. Before amendment,
against dismissal of any case by the Commission, the
consumer had to rush to this Court. The amendment in
Section 22 and introduction of Section 22-A were done for the
convenience of the consumers. We have carefully ascertained
the legislative intention and interpreted the law accordingly.
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38. In our considered opinion, the decision in Jyotsana's
case laid down the correct law and the view taken in the later
decision of this Court in New India Assurance Co. Ltd. is
untenable and cannot be sustained.
39. In view of the legal position, in Civil Appeal No.4307 of
2007, the findings of the National Commission are set aside as
far as it has held that the State Commission can review its
own orders. After the amendment in Section 22 and
introduction of Section 22A in the Act in the year 2002 by
which the power of review or recall has vested with the
National Commission only. However, we agree with the
findings of the National Commission holding that the
Complaint No.473 of 1999 be restored to its original number
for hearing in accordance with law.
40. There has been considerable delay in disposal of the
complaint. Therefore, we direct the State Commission to
dispose of the Complaint No.473 of 1999 [in Civil Appeal
No.4307 of 2007] as expeditiously as possible and in any event
within three months from the date of the communication of
this order.
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41. Similarly, in Civil Appeal No.8155 of 2001, we set aside
the impugned order and direct the National Commission to
dispose of the Original Petition No.110 of 2003 de novo as
expeditiously as possible and in any event within three
months from the date of the communication of this order.
42. Both the appeals are disposed of accordingly. The parties
are directed to bear their own costs.
................................J.
(Dalveer Bhandari)
................................J.
(Mukundakam Sharma)
...............................J.
(Anil R. Dave)
New Delhi;
August 19, 2011
