AI Structured Summary
Not yet generated for this judgment
Judgment
M. Shreesha, J
Aggrieved by the order dated 02.08.2010 in Consumer Complaint No. 03 of 2005, passed by the Chhattisgarh State Consumer Disputes Redressal Commission, Raipur (in short "the State Commission"), the Complainants preferred this Appeal under Section 19 of the Consumer Protection Act, 1986 (in short "the Act"). By the impugned order, the State Commission has allowed the Complaint in part with the following directions:
"(a) The OP shall pay a sum of Rs.3,50,000/- (Rs. Three Lacs Fifty Thousand only) towards loss relating to single fingers/ damaged fingers of planting material.
(b) The OP shall also pay a sum of Rs.2,00,00/- (Rs. Two Lacs only), towards compensation for loss suffered in relation to remaining planting material.
(c) The aforesaid amount shall be payable with interest @ (% p.a. from the date of complaint till final payment.
(d) The amount as aforesaid shall be payable within a period of 45 days from the date of this order, otherwise interest @ 12% p.a. shall be payable from the date of default."
It is relevant to mention that the First Appeal No. 336 of 2010 preferred by the Opposite Party has been dismissed for default and non prosecution vide order dated 09.08.2016 and that this order has not been challenged and therefore the question of deficiency of service against the Opposite Party has attained finality. Hence the brief question that needs to be adjudicated in this Appeal is whether the Complainant is entitled for the enhanced compensation prayed for.
The facts in brief are that the Complainants have entered into an MOU with the Opposite Party to raise and develop Safed Musli as per the guidelines given by the Opposite Party. It was agreed to source the wet material/ sapling of seeds of Safed Musli and as per the terms of the Agreement, the Complainant was to abide by the guidelines and specifications issued from time to time. After getting a loan of ₹29,75,000/- from Central Bank of India on 08.04.2003, the Complainants purchased the wet material for cultivation of Safed Musli and made a payment of ₹20,00,000/- between 24.02.2003 to 06.05.2003. 850 kgs of planting wet material out of 4,000 kgs supplied by the Opposite Party, were in broken condition and the germination in these broken fingers was nil.
It is the Complainants' case that all instructions were followed but there was no germination of the said fingers in special nursery and hence the said seeds could not be sown and that the remaining wet material supplied was also of substandard quality with dark brown spots indicating fungal infection. It was averred that the Complainants were new to the field and it was the Opposite Party who had assured about the quality at the time of supply. The Complainants purchased 4000 kgs of sowing material expecting a yield of 16,000 kgs. as per the brochure, but only 1650 kgs i.e. 10% of the sowing material and thereby causing net loss of 14350 kgs. amounting to ₹71,75,000/-.
It is the case of the Opposite Party that soil required for Safed Musli is sandy loam but the soil of the Complainants field is clayey in texture; that the crop was drenched in water for 16 hours with humidity of 100% thereby causing the damage; the wet material supplied to the Complainants was obtained from other farmers, who cultivate Safed Musli and was not produced by the Opposite Party; fingers of the wet material could have been damaged due to mishandling during transport; in the MOU there is a specific clause of arbitration; that the Complainants purchased the crop for commercial purpose and that the State Commission while allowing the Complaint to the extent indicated above and relied on the investigation report of Shri S. M. Khatele, who had subsequently filed his Affidavit. The State Commission observed as follows:
"32. The complainant has placed on record Investigation Report of Shr S.N. Khatele, who had subsequently filed his affidavit also. It is mentioned in the Report that the reason for very low yield is not known. However, in his affidavit, Shri Khatele has supported the case of the complainant. His affidavit was disputed by the OP and Shri Khatele was also put to cross-examination. He had clarified during cross-examination that when he had given his report, the documents were not made available to him, hence, he could not come to the conclusion as to what was the cause of damage to crop. He had stated in his affidavit that "reason for failure of Safed Musli crop was two-fold (a) supply of defective seeds; (b) failure of Nandan Agro Farm to give proper instruction on time to the complainant'. It appears from his affidavit that Shri Khatele is retired Deputy Conservator of Forest and Medicinal Plant Expert of Chhattisgarh State Laghu Vanopaj Sahkari Sangh, Raipur and had given the report in his official capacity. Though reason of failure of crop has not been stated in report and later on, on the basis of documents, produced subsequently before him, he has given categorical opinion in favour of the Complainant his statements cannot be challenged and the requirements, mentioned in his affidavit, for cultivation of crop of Safed Musli can very well be accepted at least as corroborative evidence. It has been stated at page no.3 of the affidavit of Shri Khatele that "due to requirement of water it is cultivated during the rainy season. Raised beds are prepared towards the end of May.....,". Regarding water logging, as mentioned in Nandan Field Observation Report, the deponent, Shri Khatele had expressed the view that "this would have no bearing upon the proper growth and cultivation of Safed Musli crop. As stated above, the beds themselves are 1 ½ ft. high. There is drainage system of about 1 ft. on both the sides. Even if, there is stagnation of water up to 2 inches, the crop would not suffer so much as to have no germination at all or 50% germination. Further, the slopping/ slanting bed structure does not permit water logging. I have seen the land and bed structure of complainants' field and can say that due to the slopping structure of the field, such water logging, so as to effect the crop so badly, is not possible." He has stated in next para 11 of his affidavit "another observation made by Officer in the above Field Observation Report is that there is 100% moisture. This is good since moisture is a must for healthy and proper growth of Safed Musli. Hence, it can be inferred from this observation that proper climatic condition was available for proper growth of Safed Musli. Therefore, lack of proper climatic Condition cannot be reason for failure of germination". In the literature produced by the parties also we have not found any material to show that 100% moisture at earlier stage of the crop, prior to when leaf start falling, is hazardous.
The expert has clarified in cross-examination that in his report, he could not mention cause of loss because documents were not made available to him. In his affidavit he had stated on the basis of documents including Field Observation Report. In the circumstances, so far as the statement of Shri Khatele relates to his opinion on the basis of facts as recorded in Nandan Field Observation Report, the same cannot be totally brushed aside simply because earlier the cause or loss was not mentioned in his Report. It is noteworthy that aforesaid Field Observation Report was prepared by Agricultural Officer of the OP and facts mentioned in the Report are not disputed by either of the parties. The deponent has assigned reasons for arriving at a particular opinion and the said reasons are not at all contrary to the literature of Safed Musli presented before us hence we find no reason to disbelieve his opinion in its entirety.
However, we feel that entire blame cannot placed on the OP, while deciding the dispute, we have to bear in mind that soil of the complainants' field was not best suited for cultivation of Safed Musli and in the circumstances best results cannot be expected. Further, water drenching may not have totally destroyed the crop but might have affected it adversely to some extent at least. It is further noted that the complainant has mentioned in document Annexure A-11 (which is Safed Musli Growers Personal Observation Report) that Agricultural Officer though visited the Complainants but not in time. It was suggested by the complainant in aforesaid document that the Officer must visit once in 15 days. It further appears from the letter dated 20.07.2003 that the complainant has complained about the fact that representative of the OP had not visited for the last 25 days.
On the basis of observations made in preceding paragraphs, we come to the following conclusions:-
(i) Non-germination of Single/broken fingers, despite special care and treatment as per advice of the OP, was due to supply of sub-standard planting material.
(ii) 50% germination of the remaining planting material was not solely due to supply of sub-standard or defective planting material but can be attributed to the soil not being best suited for cultivation of Safed Musli; water logging and drenching of some fields in water for 16 hrs. Besides this, delayed instructions/ visits of Agricultural Officers could also have affected the crop to some extent.
Now, we have to decide the question of compensation. Complainants have claimed a sum of Rs.71,75,000/- together with interest @ 15% p.a., which is highly exaggerated. We feel that entire amount of planting material which and single fingers or was damaged, which was 750kgs., should be directed to be refunded and the amount of compensation towards single/ damaged fingers amounts to Rs.3,50,000/- (Rs. Three Lacs Fifty Thousand only). So far as the remaining planting material is concerned, the complainant has received cultivation of 1650 kgs. Safed Musli despite some adverse factors noted above. So we feel that a sum of Rs.2,00,000/- (Rs. Two Lacs only), would be proper compensation for the remaining planting material."
(Emphasis supplied)
At the cost of repetition, since the Appeal preferred by the Opposite Party was dismissed and not challenged and has attained finality, the brief point that falls for consideration is whether the State Commission committed an error in awarding only ₹3,50,000/- and ₹2,00,000/- as compensation.
Learned Counsel appearing for the Complainants drew our attention to the MOU entered between the parties. For better understanding of the same, Clauses of the MOU are reproduced as hereunder:
"1. The First Party is the owner of the agricultural lands within survey Nos. 156/85, situated at P.O. Kolar Village, Abhanpur Mandal and Raipur Dist.
North:
East:
South:
West:
The Second Party has obtained random soil samples from the said land and has satisfied itself that the land is apparently suitable for the cultivation of Safed Musli.
First Party shall raise the crop Safed Musli in the above said farm site only and the Second Party shall source the wet material for plantation from various farmers who are cultivating Safed Musli under their Consultancy @ Rs.500/- per K.G. and the total cost of the wet material that would be payable by the first party would be Rs.20,00,000/-. First Party shall pay the above amount as per the following.
Payment schedule - Rs.25,000/- on the date of MOU
Remaining amount on or before 25-3-2003
The First Party has today paid an amount of Rs.25,000/- of the amount payable and has undertaken to pay the remaining amount as per the above schedule.
As every such amount paid by first party will in turn be paid by the second party to the farmers for booking the wet material as such even if the first party intends to withdraw cultivation program the amount so paid by the first party till then will be forfeited and the first party shall not have any claim of what so ever nature in respect of the said amounts against the second party.
The First Party hereby agrees to abide by the guidelines and specifications issued by the Second Party from time to time with respect to the project.
the first party shall arrange the infrastructure machinery as per the specifications given by the second party.
The First Party shall render all sorts of co-operation to the field staff and agricultural officers of the Second Party to have site visit of the farm at any time during the crop and during continuance of this MOU.
The Second Party agrees to provide in writing to the first party the information relating to the cultivation practices that are to be followed in respect of Safed Musli and the First Party will acknowledge the receipt of the same.
The First Party shall enter into any supplemental MOUs or arrangements as and when felt necessary by the Second Party.
Agricultural Officer/ Field staff will periodically visit the farm of the First Party and give such inputs that are necessary to ensure performance of package of practices.
The Second Party will assist to market the produce of Safed Musli cultivation at the market price available them, however, the First Party is at liberty to sell if he is able to get a better price.
The First Party shall deliver 10% of the total produce either kind or in cash towards the consultancy charges to the Second Party on sale of entire produce.
Any dispute that arises between the parties shall be referred to the institutional arbitration i.e., Jupiter Legal Services Pvt. Ltd., and the decision given by the said Arbitration Tribunal shall be final at binding on both the parties. For the purpose of arbitration this clause shall be treated as reference to arbitration.
The First Party shall depute his/her representative at the time of weighment of wet material to ensure proper weighment and to take delivery of the material."
(Emphasis supplied)
Learned Counsel also vehemently contended that the quotation of Safed Musli dated 25.02.2003 states that an amount of ₹20,00,000/- has been given for purchase of 4,000 kgs.
It is relevant to mention here that field information report, the date of collection being 18.01.2003, states that the soil required for Safed Musli is sandy loams and as the soil samples are clayey in texture Safed Musli cultivation should be done as per the package of practices applicable to the field. Therefore the contention that the soil which was used for cultivation of Safed Musli is the wrong soil and therefore the yield was not up to the mark is untenable as the Opposite Party in their won Field Information Report stated that the cultivation could be done as per the package of practices available to the field.
It is further relevant to mention that in the brochure it is specifically mentioned that on a Turnkey basis, the Opposite Party undertakes the project from conception to completion. It clearly stated that the Opposite Party is committed to help its clientele realize the best returns on their investment. In addition to appropriate and timely counseling, the Company will provide for close monitoring and management of the project under the guidance of a trained Agricultural Officer. Having promised all help and having done field inspection coupled with the report given by Shri S.M. Khatele, we are of the considered view that the Opposite Party has failed in assisting the Complainants to get the appropriate yield. At this juncture, it is relevant to mention that Shri S. M. Khatele, Retd. Deputy Conservator of Forest & Medicinal Plant expert, Chhattisgarh has stated in his Affidavit as follows:
"I have been shown the Field observation Report written by the Agricultural Officer of Nandan Agro Farms on his visit on 4/9/2003. It has been observed that germination in the entire field is found to be 50% only. In my view, since Mr. Marwah has been following the instructions properly, there could be only two reasons for failure of proper germination of seeds: (a) supply of defective seeds; or, (b) lack of proper instructions and supply of technical knowhow by Nandan Agro Farms to Mr. Marwah.
I further noticed in the said Field Observation Report that the single tube germination in 2 acres has been nil. In my view, generally the wet material comprises of two and three fingers attached with crown. This would lead to a healthy growth. Single and defective fingers indicated in the email of 23.5.2003 shows that the wet material supplied was itself defective which was the primary reason for failure to germinate.
It has been observed by the Officer in the above said Filed Observation Report that there was water-logging upto 1 to 2 inches. In my view, this would have no bearing upon the proper growth and cultivation of Safed Musli Crop. As stated above, the beds themselves are 1 ½ ft. high. There is drainage system of about 1 ft. on both the sides. Even if there is stagnation of water upto 2 inches, the crop would not suffer so much as to have no germination at all or mere 50% germination. Further, the sloping/ slanting bed structure does not permit water logging. I have seen the land of Mr. Marwah and the bed structure and can say that due to the slopping structure of the field, such water logging, so as to affect the crop so badly, is not possible. The only plausible, explanation of the drastic failure of the crop, in my view, is supply of bad and defective wet material.
Another observation made by the Officer in the above Field Observation Report is that there is 100 moisture. This is good since moisture is a must for healthy and proper growth of Safed Musli. Hence, it can be inferred from this observation that proper climatic condition was available for proper growth of Safed Musli. Therefore, lack of proper climatic condition cannot be the reason for failure of germination.
From the documents on record, in my opinion, though the land was certified by Nandan Agro Farm to be suitable for Safed Musli cultivation and inspite of the fact that proper growth of Safed Musli and even though Mr. Marwah followed every instruction given by the officers of Nandan Agro Farm, the crop miserably failed because of defective wet material provided by Nandan Agro Farm and further due to failure to provide on-the-spot timely proper instructions and supply of technical know-how required for proper cultivation of Safed Musli.
I am giving this opinion on the basis of my knowledge of Safed Musli cultivation and on the basis of observation and analysis I have made on the basis of the documents supplied to me, which are already on record in the case and without being influenced by anyone."
(Emphasis supplied)
Keeping in view the aforenoted expert opinion that the crop miserably failed because of defective wet material provided by the Opposite Party and also on account of the failure of the Opposite Party to provide on the spot and timely proper instructions with technical knowhow despite their promise in the MOU, the loss of the promised yield can be squarely attributed to the deficiency of service of the Opposite Party. Hence the contention of the learned Counsel appearing for the Opposite Party with respect to soil moisture and agricultural practices are all untenable.
It is further significant to mention that there were no objections filed by the Opposite Party to this report.
Learned Counsel for the Opposite Party vehemently contended that the enhancement of the compensation cannot be allowed as the moisture present was 100%, the water logging was 1 to 2 inches in some beds and therefore best result could not be expected. This statement is in contravention to what the expert has stated in his report and it is pertinent to mention that the expert has also been cross examined and he has filed his Affidavit by way of evidence reporting that the yield was less only because of the deficiency of service of Opposite Party.
Learned Counsel appearing for the Complainants has given following estimation for five acres and brake-up of the amount of ₹71,75,000/-, which has been prayed for:
"Estimation for Five Acres
1 year - Nursery Year - Inputs
(Rs. In Lakhs)
a.
Cost of the plantation material (@ 500 kgs/ acre) @ Rs.400/- per kg for 2500 kgs of tubers.
10.00
b.
Cultivaiton expenses @ Rs. 75,000/- acre for 5 acres i) Land Preparation ii) Fertilizers & Chemicals iii) Irrigation iv) Labour charges
3.75
Expected Outputs - I Year
10,000 kgs of Sowable Musli (worth about Rs. 40 lakhs)
2500 kgs. of broken musli becomes 500 kgs.
(20% of weight on drying)
Sale price of dry musli @ 1000/- per kg. 5.00
8.75
II Year - Break- Even Year - Inputs
10,000 kgs. of planting material for 20 acres 8.75
Cultivation expenses @ Rs.60,000/- per acre 12.00"
20.75
Expected Outputs - II Year
a. 40000 kgs. Sowable musli (80 acre)
b. 10000 kgs of broken material (tubers)
50000 kgs-20% dry musli (total on drying)-10000 kgs
10000 X Rs. 1000/- = 1,00,00,000/- (Rs. One Crore) 100.00
79.25
Details of Production and loss as under:
Production
Rate per Kgs
Total amount in lacs
Estimated production (as per their Brochure) for 8 acre Actual production
16000
500
80 lac
1650
500
8.25 lac
14350
71.75 lac
Total amount paid for 8 acre-4000 kgs seeds @ 500 per kg = 20 lacs
Yield of 16000 kgs
Actual production - 1650 kgs which 10% of the actual planting material
Loss of production 14350 kgs.
(16000-1650)+14350 kgs
monetary loss 14350 X 500= Rs.71,75,000/-"
Even if, we take into consideration 50% estimated production as per the brochure for 8 acres at 16,000 kgs., the yield would be 8,000 kgs. The actual production was 1650 kgs. and if the same is deducted from 8,000 kgs.,it is 6350 kgs. and if the monitory loss can be calculated taking into consideration what the brochure has given i.e. rate of ₹500/- per kg it is equivalent to ₹31,75,000/-. This lump sum amount is being awarded as compensation to the Complainant for the loss of crop in its totality to meet the ends of justice together with cost of ₹25,000/-. We are of the considered view that this lump sum amount is reasonable and this amount is being awarded taking into consideration only 50% of the actual production promised by the Opposite Party in their brochure and also the expenses incurred for cultivation.
In the result, this Appeal is allowed in part and the order of the State Commission is modified to the extent indicated above.
Time for Compliance four weeks from the date of receipt of a certified copy of this order failing which the amount shall attract interest @ 9% p.a. from the date of filing of the Complaint till the date of realization.