Orissa Lift Irrigation Corp Ltd vs Birakishore Rout

1.IN appeal No. 65 of 1990 the appellant (Orissa Lift Irrigation Corporation Ltd. & Ors.) have appealed against die order of 6th of August, 1990 of the State Consumer Disputes Redressal Commission, Orissa, Cuttack.

THE farmers listed as respondents 1 to 39 had entered into an agreement with the appellant for supplying water for irrigation of certain crops from the 9th November, 1989, for the agricultural season then commencing. Water was to be supplied by the Corporation on payment of the water rates specified in the agreement Supply of water for irrigation was commenced on 9th of November, 1989 but was discontinued from the 8th November, 1989 due to failure of electricity as the transformer had got burnt The transformer was replaced on 17th January; thereafter the electricity supply and the supply of water were restored.

THE State Commission came to the conclusion that the Lift Irrigation Corporation had not taken adequate and timely steps to rectify the power breakdown resulting from the transformer being burnt and as such there has been negligence in rendering service to the respondents in terms of the agreement, which caused damage to crops. Consequently it had granted reliefs to the respondent complainants by way of refund of water rates paid by them and also by way of damages at the rate of Rs. 250/ - per area mentioned in the agreement.

THE appellants have challenged the order of State Commission on the following grounds : - (i) The agreement to supply water was with each individual cultivator but the complaint was made by 39 of the cultivators jointly by combining the claims of 41 individuals. By this device, the value of service hired viz. the amount paid as water rates by each individual was ''inflated'', the claim of each individual could not exceed Rs. 1 lakh which would be in the jurisdiction of the District Forum, whereas by clubbing the claim of various individuals, the value of services was raised to more than Rs. 1 lakh thereby bringing the complaint within the jurisdiction of the State Commission.

The appellant has observed that ''the complaint is not within the pecuniary jurisdiction of the Honble State Commission as number of individuals joining together and adding their separate and independent claims with different causes of action and different amounts claimed, cannot confer jurisdiction on the State Commission. None of the complainants have claimed the damages or compensation exceeding Rs. one lakh''.

(ii) The failure to supply water was caused by factors beyond the control of the Corporation as the transformer of the. Electricity Board was burnt out. The agreement for supply of water contains a force majeure clause which absolves the corporation of liability arising from such a breakdown.

(iii) That the parties had agreed that in case of any differences arid disputes, the same shall be referred to the Collector for decision which would be binding on the parties. Hence, according to the appellants, the complaint cannot be entertained by the State Commission.

(iv) That the water supply was being used for commercial purpose of agriculture and as such the farmers were not consumers as defined in the Consumer Protection Act.

(v) That the transformer belonged to Orissa State Electricity Board and that it was the duty of the OSEB to replace the transformer and restore the supply of electricity. The OLIC could have resumed the supply of water/only after the Electricity Board had restored the electricity and therefore the OLIC could not be held responsible for the loss, if any, caused to sthe farmers due to power breakdown.

The State Commission in its order held that Lift Irrigation Corporation Limited rendered the service of supply of water to the agricultural lands of the complainants against consideration, that the complainants were consumers under the Consumer Protection Act and that the dispute came within the jurisdiction of the State Commission. It observed that ''we would have normally refused to entertain such a complaint if we would have felt that the grievance is such that we should not entertain a complaint when the District Forum can adequately give relief. However, the complaint has been filed in December, 1989 and this complaint should not be rejected after long time for initiating the same before the District Forum afresh since we are satisfied that grievance of the complainants requies adjudication''.

THE appellant has specifically challenged this decision of the State Commission permitting a consolidation of the individual complaints thereby by -passing the jurisdiction of the District Forum. It has contended that this was not permissible in view of the definition of the consumer and person under Section 2(1)(b), (d) and (m) and therefore the respondents collectively had no locus standi.

IN this particular case, the Clause 5(iii) of the agreement between the LICL and the cultivators specifically laid down that the water supply from a Lift Irrigation Project shall commence after the cultivators in a compact block within the designed Ayacut of a Lift Irrigation Project apply for water and sign the agreement making them jointly and severally responsible. Again the first schedule of the agreements reads as under : - ''All the ayacutdars who have entered into this agreement will be jointly and severally responsible for the conditions of agreement and also be jointly and severally liable for payment of the dues at the rate mentioned in the second schedule''.

It is clear from the above that the agreement was with the cultivators jointly and it is not open to the LICL now to urge that the cultivators cannot join together to club their claims and file a complaint jointly before the State Commission.

THIS also raised a question of fundamental importance for the consumer protection movement in India; does the Act necessarily enjoin each complainant filing a separate complaint before the appropriate fora or whether it is permissible under certain circumstances, for a group of consumers to combine and file a complaint jointly and the jurisdiction of the forums being determined on the basis of the complaint jointly made. In other words, can a group of complainants acting collectively acquire locus standi under the Act?

UNDER Section 2(1)(b) of the Consumer Protection Act, complaint can be lodged by (a) a consumer (b) by any voluntary consumer association registered under the Companies Act or under any law. Consumer has been defined under Section 2(1)(d) as any person who buys goods or services for a consideration.

The term person has been defined in Section 2(i)(m) which is reproduced below for convenience : - ''(i) a firm whether registered or not; (ii) a Hindu undivided family; (iii) a co -operative society; (iv) every other association of persons whether registered under the Societies Registration Act, 1860 (21 of 1860) or not.''

It is significant that every association of persons whether registered under the Society Registration Act or not is deemed to be a person.

This jeads us to the meaning of the term association. Since there is no statutory definition of the word association, we have to understand it in accordance with the ordinary meaning in the lexicons. To associate is to join in a common purpose of action. An association of persons is indefinite in number of its members. It can also mean an unicorporated company whose membership is fluctuating.

The concepts association of persons and association of individuals help to clarify the meaning of the term association.

An individual can only be a natural person whereas a person in law may be both a natural person as well as a legal -person a fiction. Consequently a ''consumer'' under the Consumer Protection Act need not necessarily be an individual nor a legal person such as a Company under the Companys Act or a partner under the Partnership Act. A body of any persons bound together by a common purpose can be said to form an association if they are acting jointly in pursuance of the common purpose.

IT would appear that, on larger considerations, the legislature knowingly allowed a voluntary association of a number of persons, who are also individual consumers, to seek redress under the Consumer Protection Act, through a joint complaint. It is hardly necessary to emphasise that a petty individual consumer may find it extremely difficult to prosecute a complaint under this Act because he may be illiterate, and ignorant of law, may not have the resources and the time to prosecute the complaints before the various forums and may not find it worthwhile to seek relief under the Act for individual complainants which necessarily would be petty individually. It is perhaps in that context that the voluntary consumer associations registered under a law have been specifically clothed with locus standi in respect of complaints under the Act. Viewed in this background it is in the interest of providing protection to consumers that any association of persons, whether registered under the Society Registration Act or not, are deemed to be a person and therefore a consumer under Section 2(i)(d) of the Act.

AN association of persons to have locus standi as a consumer, it is necessary that all the individuals persons forming the Association must be consumers under Section 2(i)(d) of the Act, that they must have purchased any goods or hired a service for consideration; they must have purchased the same goods or hired the same service from the same party, and more or less over the same period in short they should have a common cause of action. The State Commission was therefore justified in rejecting this preliminary objection of the LICL regarding the locus standi of the complainants and the jurisdiction of the State Commission both with reference to the agreement executed by the LICL with the cultivators and the provisions of the Consumer Protection Act.

AS regards the question whether the appellant was absolved of all liability under force majeure clause, the State Commission has rightly observed that protection under Clause 6 of the agreement would have been available if the Opposite Party No. 1 had taken all reasonable steps which were within their control. After examination of the evidence, the State Commission came to the conclusion that the officers of the LICL had not taken adequate action for restoration of power, did not realise the importance of supply of water immediately and treated the matter very casually. We agree with the State Commissions findings that Clause 6 of the agreement cannot give protection for this negligence of the Opposite Party.

WE may note here Clause 3 of the agreement which reads ''The installation for the supply of electricity and the supply of water through pumps shall be undertaken by the Corporation at their own expense. The Corporation shall also run and maintain at their own cost the pump and electric installations undertaken by them''. Whatsoever might have been the arrangements between the LICL and the State Electricity Board, the responsibility for supplying water to the cultivators was that of the LICL and if there was any power breakdown, this should have been set right or got rectified within reasonable time. And reasonable time in this case could only mean immediately or almost immediately inasmuch as breakdown of power and water supply have to be rectified immediately as otherwise it will totally disrupt the life of the community and cause widespread serious hardship. It is in this context also that the observations of the State Commission of negligence on the part of the LICL have to be appreciated. There is no merit in the other grounds of attack of the appellant. The Consumer Protection Act is in addition to the other laws in force and therefore it was net necessary for the complainants to seek redress through arbitration by the Collector. There is also no merit in the contention of the appellant that water was being supplied for a commercial purpose.

It is noticed that water was supplied to the cultivators from the 9th November to 16th November, 1989; power breakdown occurred on the 17th November, 1989. The State Commission has ordered the refund by the LICL of all the water charges for the entire period of the contract. The refund has to be limited to the period during which the water supply remained suspended viz. from 17th December, 1989 to 17th January, 1990. We uphold the order of the State Commission which will stand modified as set out above so far as the amount of water charges to be refunded is concerned.

THE First Appeal No. 70 of 1991 on the same facts and between same parties also stands disposed with the above order. Appeal dismissed.