CUREWELL HOSPITAL PRIVATE LIMITED vs KOHLI MEDICAL GASES PVT. LTD.

THE complainant, M/s. Curewell Hospital Private Limited, is a company incorporated under the Indian Companies Act, 1956. Dr. Vinod Surana is its Director. In order to make the hospital a self-contained one, Dr. Surana needed a Central Medical Gases Pipelines System (CGPS) and for this purpose, he wrote a letter to Opposite Party No. 1. M/s. Kohli Medical Gases Pvt. Ltd. (for short O.P. No. 1) on 24.1.1989 soliciting information in this behalf. As required by O.P. No. 1, Dr. Surana sent Architectural Design of the hospital to them. THEreafter Mr. Romi Talwar, Proprietor of M/s. D.R. International, Bhopal, Opposite Party No. 2 (for short O.P. No. 2) contracted Dr. Surana, with reference to the letters exchanged between him (Dr. Surana) and O.P. No. 1 stating that O.P. No. 2 was the authorised agent of O.P. No. 1 in the State of Madhya Pradesh. O.P. No. 2 also stated that the order would be received through them (O.P. No. 2) and it would be executed by O.P. No. 1. On this basis, Dr. Surana agreed to receive the supply and service of installation of CGPS at the agreed price of Rs. 3.30 lacs. This price was worked out and communicated by O.P. No. 1 to O.P. No. 2 vide letter dated 4.5.1990. In that letter, O.P. No. 2 also said that the system would be delivered and installed on receipt of advance in full and the delivery period would be about 10/12 weeks. On 25.4.1990, Rs. 3.50 leas were paid to O.P. No. 2 with whom the complainant had placed an order for supply of hospital furniture as well. THE said amount included Rs. 3.30 lacs being the full price of CGPS. Dr. Surana was keen to open the hospital during November, 1990 and he expected that O.P. No. 1 would install the CGPS latest by July, 1990. O.P. No. 1 delayed the installation of the said system. THEy commenced the work in second week of June, 1990 and part installation of the equipment was done. THE Installation Engineer of O.P. No. 1 submitted report on 20.6.1990 about partial installation. THE working team left the work place with an assurance to come back within a couple of days to complete the remaining installation with a week. This service is yet to be rendered. Failure on the part of the Opposite Parties No. 1 and 2 to render the installation of the CGPS complete in all respects constitutes a serious deficiency in the rendering of service within the meaning of Clause (g) of Sub-section (1) of Section 2 of the Consumer Protection Act, 1986 (for short the Act).

THERE were some superfluous and collusive pretexts by both opposite parties as it is evident from the letter dated 25.7.1990 (in this letter O.P. No. 1 had complained to O.P. No. 2 that in spite of reminders and talks on telephone etc., only Rs. 70,000/- were paid and Rs. 2,43,500/-. which were promised to be paid were not being paid by the former). The complainant company had already circulated a booklet containing highlights of the hospital and also mentioning about installation of CGPS. He lacs by a draft dated 3.12.1990. Another draft for Rs. 15,000/- was paid to O.P. No. 1 by the complainant. However, O.P. No. 1 failed to render the desired services in spite of personal visits, telephone calls and reminders through letters and telex. A notice dated 1.2.1991 through an advocate was also sent to the Opposite Parties, but to no avail. O.P. No. 1 has started demanding escalation in prices but as the complainant was not at fault, he did not pay the amount. The complainant contracted another supplier and got quotations for delivering the work at an estimated additional expenditure over Rs. 3 lacs. In the complaint, the complainant prayed for the following reliefs: (A) Return of Rs. 12,71,750/- paid by the complainant to the opposite parties for services and other charges required to be incurred including cost of temporary arrangements required to be made to overcome the deficiency along with interest @ 18% p.a.; (B) Rs. I lac as compensation for mental injury suffered by the complainant on account of negligence/deficiency in services rendered by the opposite parties; (C) Rs. 15,000/- as cost of the complaint.

P. No. 1 raised a preliminary objection to effect that the complainant was not a "Consumer" as defined under Section 2(d) of the Act, since the CGPS was being got installed for a commercial purpose. The contract was for supply of CGPS and installation thereof and it was not a contract for rendering of any service so as to attract the concept of deficiency in any "service", as defined in the Act. On merits it was pleaded by O.P. No. 1 that there was no privity of contract between the complainant and O.P. No. 1. The Order was placed by O.P. No. 2. and thereafter all the communication took place between opposite parties. O.P. No. 2 was in fact acting as an agent of the complainant and not of O.P. No. 1 as alleged by the complainant. It was Mr. Romi Talwar of O.P. No. 2, who had visited the office of the O.P. No. 1 in New Delhi and made inquiries for and on behalf of the complainant and also submitted architectural drawings of Curewell Hospital. Quotations for supply of CGPS was also sent to O.P. No. 2. It was O.P. No. 2 who wrote a letter dated 9.5.1990 accepting the offer subject to the final approval by the complainant hospital. A sum of Rs. 10,000/- was paid as advance (in cash) by O.P. No. 2 and promised to send Rs. 1.60 lacs against 50% payment to start the work. Another sum of Rs. 60,000/- was paid by means of a draft by O.P. No. 2. It was sent alongwith their letter dated 11.5.1990 with a request to resume the work at the complainant hospital. The remaining 50% of the amount to be paid at the placement of Order was promised to be paid within a week. Vide letter dated 25.7.199 O.P. No. 1 complained to O.P. No. 2 that though the latter had promised to sent a draft for Rs. 2 lacs, but it was not being sent. A request was made for payment of Rs. 2 lacs immediately. The total amount received by O.P. No. 1 from O.P. No. 2 and Dr. Surana was Rs. 3,05,000/- as against Rs. 3,30,000/- plus admissible taxes amounting to Rs. 33,000/-. Therefore, according to O.P. No. 1, they have not defaulted and in fact O.P. No. 2 and the complainant have defaulted in making payments as agreed upon.

O.P. No. 2 raised a preliminary objection similar to the one agitated by O.P. No. 1. O.P. No. 2 has denied the fact that he is the authorised agent for O.P. No. 1 in the State of Madhya Pradesh. As a matter of fact, the discussions were held directly between the complainant and O.P. No. 1. The CGPS was to be supplied, delivered and installed by O.P. No. 1 on receipt of advance in full of the quoted price but the complainant has not paid the amount to O.P. No. 1. The alleged advance of Rs. 3.5 lacs was for supply of furniture, CGPS, X-ray machines etc., and that it is wrong on the part of the complainant to say that out of that amount, only Rs. 20,000/- was towards the cost of furniture and the remaining amount was for CGPS. The cost of X-ray machine alone was Rs. 5,60,000/-. The cost of furniture was Rs. 4,24,280/-. Thus, out of the said advance, only Rs. 1,44,000/- was meant for advance towards purchase of CGPS and the remaining towards advance for purchase of X-ray machine and hospital furnitures. The invoice for the furniture supplied alone was of Rs. 3,32,380/-. O.P. No. 2 has still to receive huge amounts from the complainant for the supply of furniture and other items, Rs. 1,40,000/- have been paid by O.P. No. 2 to O.P. No. 1. After hearing the learned Counsel for the parties, we agree with the contention of the opposite parties that the complainant, M/s. Curewell Hospital Private Limited, is not a "Consumer" as defined in the Act. "Consumer", in relation to goods, has been defined in Clause (d)(i) of the Section 2(1) of the Act, and the definition is as follows: "Consumer" means any person who, - (i) buys any goods for a consideration which has been paid or promised or partly paid and partly promisedbut does not include a person who obtains such goods for resale or for any commercial purpose".

ACCORDING to pamphlet issued by the complainant (which is at pages 23 to 25 of the Paper- Book), the hospital is a 70 bedded one and is manned by a dedicated, highly qualified and competent doctors, nurses and other well trained medical staff & technicians. The hospital contains all the modern equipments. It has its own pathological and biochemical laboratories in which the latest'' Scientific instruments are being used. There is also a provision for Haemodialysis in the hospital. The operation theatres in the hospital are fitted with sophisticated equipments of international standard. CGPS was being installed in operation theatres, ICCU. Paethatric ICU, Labour-room and Dialysis unit to provide continuous and uniterrupted supply of oxygen, nitrous oxideid suction line. Therefore, it is clear that the hospital in question is a big one and it has been established for earning huge profits. Commercial activity has been defined by this commission in Synco Textiles Pvt. Ltd. v. Greaves Cotton & Company Ltd., I (1991) CPJ 499 (NC) as follows: - "Going by the plain dictionary meaning of the words used in the definition section the intention of Parliament must be understood to be to exclude from the scope of the expression "consumer" any person who buys goods for the purpose of their being used in any activity engaged on a large scale for the purpose of making profit. As already indicated since resale of the goods has been separately and specifically mentioned in the earlier portion of the definition clause, the words "for any commerce purpose" must be understood as covering cases other than those of resale of the goods. It is thus obvious that Parliament wanted to exclude from the scope of the definition not those who purchase goods with a view to using such goods for carrying on any activity on a large scale for the purpose of earning profit. On this interpretation of the definition clause, persons luying goods either for resale or for use in large scale profit making activity will not be "consumers" entitled to protection under the Act. It seems to us clear that the intention of Parliament as can be gathered from the definition section is to deny the benefits of the Act to persons purchasing goods either for purpose of resale or for the purpose of being used in profit making activity engaged on a large scale. It would thus follow that cases of purchase of goods for consumption or use in the manufacture of goods or commodities on a large scale with a view to make profit will all fall outside the scope of the definition. It is obvious that parliament intended to restrict the benefits of the Act to ordinary consumers purchasing goods either for their own consumption or even for use in some small venture which they may have embarked upon in order to make a living as distinct from large scale manufacturing or processing activity carried on for profit. In order that exclusion clause should apply it is however necessary that there should be a close nexus between the transaction of purchase of goods and the large scale activity carried on for earning profit".

Thus, the Central Gas Pipeline System (CGPS) was intended to be purchased by the complainant clearly for commercial purpose. Therefore, the complainant can not be said to be a "Consumer" as defined in the Act. The contention of the petitioner that the purchase and installation of the CGP System will amount to "service" to be rendered by the opposite parties is not acceptable by us. The question of service, if any would have arisen only after the CGP System had been installed and commissioned. Till the System was installed in the hospital, it will amount to purchase of the System, i.e., purchase of "goods " which as discussed above, was clearly for commercial purpose. For the foregoing reasons, we dismiss the present petition. We make no order as to costs. Petition dismissed.