Amendment of consumer complaint to class action cannot be allowed without following Order 1, Rule 8(4): Delhi High Court

The Delhi High Court has recently ruled that in the case of a class action consumer complaint, amendments to the complaint cannot be allowed without following the warrant under Ordinance 1, Rule 8(4) of the CPC .

Allowing the motion against an order of the National Consumer Dispute Redress Commission (NCDRC), Judge C. Hari Shankar observed:

“If, at a later time, the plaintiff(s) wish to abandon part of the claim, Article 8(4) of Order I permits such abandonment provided, before doing so, that the Court again gives notice to all persons so interested. , i.e. all persons whose interests the original complaints were intended to marry, in the same manner as provided by Ordinance I Rule 8(2), i.e. either individually or, if this is not possible, by public announcement.”

The respondent and other plaintiffs had filed a consumer complaint against the petitioner Puri Construction Pvt. ltd. before the NCDRC under section 12(1)(c)1 read with section 21 of the Consumer Protection Act 1986 and Order I, Rule 8 of the First Schedule to the Code of Civil Procedure , 1908 (CPC), as a class action complaint representative. The complaint clearly stated that it was filed for the resolution and redress of the grievances of the 48 named plaintiffs and also to address the common grievance of all consumers affected by the opposing party’s price discrimination in the Aanand Vilas project. .

The complaint alleged that the application form provided to the complainants and other investors in the petitioner’s project did not contain relevant or material information about the project or the time frame in which it would be completed and that the purchasers/ investors had been forced to pay several charges such as Preferential Location Fee (CLP), parking, club furnishing fee and firefighting fee, which had no place in the initial application that had been provided to them, which they had completed and submitted. Moreover, although the plaintiffs paid 80-90% of the payments demanded by the petitioner, the plaintiffs were coerced into honoring all of the petitioner’s allegedly illegal demands, and the petitioner was allocating identical apartments to strangers at nearly the half of the price at which they were awarded to the plaintiffs.

It was argued that the alleged acts constituted “unfair trading practices” within the meaning of Section 2(r)(1)(ix)4 of the Act, as the petitioner was effectively misappropriating investors’ hard-earned money.

The Court referred to section 2(1)(b)(iv) of the Act, which defines “complainant” as meaning “one or more consumers where there are several consumers having the same interest”. He was also referring to Brigade Enterprises v. Anil Kumar Virmani, where community of interest has been found by the Supreme Court to be the sine qua non for permitting a claim under section 12(1)(c) of the Act to be filed by one or more consumers in the name of other persons not individually implicated.

The Court held that Section 12(1)(c) had been made applicable, mutatis mutandis, to the NCDRC by Section 22(1) of the Act. Therefore, when a request under Article 12(1)(c) is granted by the Consumer Forum, this amounts to the granting, by the Consumer Forum, of its judicial imprimatur to the assertion of the plaintiffs/complainants. before him that all of the people whom because the plaintiffs seek to marry are people who are “so interested” in the complaint and the remedies sought.

Accordingly, it was held that the Respondents being, therefore, “Complainants” within the meaning of Section 2(1)(b)(iv) of the Act, Order I, Rule 8 of the CPC becomes applicable, mutatis mutandis, to the consumer’s complaint. filed by the respondents, pursuant to section 13(6) of the Act.

Order 1 Rule 8(4)

The Court held that the principle of construction to be applied to Ordinance I Rule 8(4) is that the same expression, used in different provisions of an enactment, must have the same meaning unless the provision in question unequivocally indicates a contrary intention. He noted,

“The applicability of this principle is increased where the expression appears in different parts of a legislative provision. Applying the above principle, the expression “so interested”, appearing in the various clauses of the section 8(1) must be granted, moreover, in my opinion, the words also have the same meaning as the words “if interested” as used in section 12(1)(c) of the Act, c Therefore Order I Rule 8 has, by section 13(6) of the Act, been made applicable, mutatis mutandis, to class actions brought under section 12(1)(c).”

On this question, the Court also referred to the case of Kesavananda Bharati v. State of Keralawhere it was judged that,

“It is one of the accepted rules of interpretation that the Court must presume that the legislature habitually uses the same words in a statute to convey the same meaning. If different words are used in the same statute, it is reasonable to suppose that, unless the context indicates, the legislator intended to give different meanings to these words.”

Clause (a) of Order I Rule 8(1) states that “where many persons have the same interest in a suit, one or more of such persons may, with leave of this Court, sue or be sued, or may defend such suit, in the name or for the benefit of all persons so interested “. The Court noted that all persons whose cause the prosecution seeks to espouse, as persons ordering the common interest, are persons “so interested” within the meaning of Order I Rule 8(1)(a) .

Order I Rule 8(2)

Order I Rule 8(2) requires the Court, in all cases where leave to bring a class action is granted under Order I Rule 8(1), to give, at the plaintiff’s expense, a notice of the commencement of the action, to all persons so interested either by personal service or, if that is not possible, by public announcement. Therefore, the Court noted that clearly, the words “everyone so interested“refers to expression”so interested“as employed in Order I Rule 8(1)(a). That is, all persons whose interests as the complainant, filing a class action complaint under section 12 (1)(c) of the Act, purports to marry, are persons “so interested” within the meaning of Order I Rule 8(1)(a) and, likewise, therefore, Order I Rule 8(2).

He stated that Order I Rule 8(3) does not even use the word “interested”. What it does say is that any person on whose behalf or for whose benefit a suit is brought under Order I Rule 8(1) may apply to the Court to be made a party to the suit . In other words, it is open to anyone whose interest the plaintiff under Ordinance I Rule 8(1)(a) claims to marry to apply to become a party to the suit individually. It was held that this did not by any principle of interpretation restrict the scope of the term “so interested” as used in Order I Rule 8(1)(a) or Order I Rule 8(2), to persons who then apply only under Rule 8(3) of Ordinance I. It noted,

“The intent of Order I Rule 8(3) is obvious. It is to ensure that, even if the representative prosecution under Order I Rule 8(1)(a) espouses the interests of a large number of persons having common interests, if any of these persons individually wish to espouse their case before the Court, they may individually apply to do so under Order I rule 8(3) by being named individually as a party to the action, therefore, have no bearing on the understanding of the term “so interested” as used in the other provisions of Order I Rule 8, including Order I Rule 8 (4 ).”

Order I Rule 8(4)

On Order I Rule 8(4), the Court held that the provision unequivocally prohibits the abandonment of any part of the claim in such a suit. Accordingly, any action brought under Order I Rule 8(1) – shall be discontinued unless the Court has given, at the plaintiff’s expense, notice to all persons so interested, in the manner specified in Order I Rule 8 (2) .

The Court held that the application of the provisions of Ordinance I Rule 8 mutatis mutandis to the Act, if one or more consumers wish to bring a representative consumer complaint, espousing the cause of a large number of people having a common interest , pursuant to section 12(1)(c) of the Act, they should seek leave under that provision to file a representative complaint. Then, the Court would notify all the persons so interested, that is to say all the persons whose common interest the complaint claims to defend, either individually or by means of a public announcement.

Judgement

In this case, the Court held that the variation petition was not filed after notice to all persons on whose behalf a consumer complaint was filed, nor was it adopted by all then-existing complainants, including those who had responded to the notification. issued by NCDRC scholar. As the exercise was not undertaken in this case, the Court held that the NCDRC erred in granting the Respondent’s application to amend Consumer Complaint 335/2017 by abandoning the relief of possession claimed.

It was held that the NCDRC’s opinion could not be supported because it was not open to the NCDRC to say that it was not necessary to publish a public notice before allowing the modification of the complaint since the amendment to the complaint sought to abandon the remedy of possession originally sought.

In addition, for the NCDRC to determine that the amendment could initially be permitted and, subsequently, a public notice would be issued, which would allow those interested in the relief sought in the original complaint to apply individually to the Forum of consumers and pursue their own remedy was found to be in complete violation of Ordinance I, Rule 8 of the CCP and, therefore, of Article 13(6) of the Act. It has been observed,

“Where Order I Rule 8(4) expressly requires prior notice to ‘all persons so interested’ in the class action complaint, such requirement cannot be overridden by first permitting the amendment of the complaint by abandoning a part of the relief sought and then giving public notice to the people on whose behalf the complaint was filed would be putting the cart before the horse.

Case Title: Puri Constructions Ltd v. Shailesh Gupta & Ors.

Click here to read the order

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