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M/s. Prabha Exim Pvt.Ltd v/s Savla Foods And Cold Storage Pvt.Ltd

    Complaint Case No. CC/08/62
    Decided On, 20 January 2012
    At, Maharashtra State Consumer Disputes Redressal Commission Mumbai
    By, MEMBER
    For the Complainant: Anand Patwardhan, Advocate. For the Opposite Parties: S.B. Prabhavalkar, Advocate.

Judgment Text
S.R. Khanzode, Presiding Judicial Member

(1) This consumer complaint pertains to alleged deficiency in service on the part of the warehouse, viz. Opponent Savala Foods and Storage Pvt. Ltd. (hereinafter referred to as 'the Warehouse') wherein the Complainant had stored its custom bonded goods of cloves in the cold storage chamber and which gutted into fire which broke out on 07.11.2006. According to Complainant he had lost 315 bags of imported cloves and suffered loss of Rs.32,89,731/-. Alleging an act of negligence on the part of the warehouse it is submitted that the warehouse allowed to keep goods in an unscientific manner; the goods were scattered all over resulting in blockage of passage within the warehouse; there was no proper maintenance of the warehouse and the storage was allowed beyond its original capacity and no proper precautions were taken for safety of the goods stored therein.

(2) Undisputed facts are that Complainant in the course of its business imported two containers containing 200 bags of 50 kg. each of Cloves. Said consignment was received at Nhava Sheva Port and since Complainant had no immediate need to take the delivery of those containers, the Complainant submitted bill of entry for bonded goods to custom department and in view of such request, the custom department shifted goods of both the containers to the warehouse, respectively, on 31.08.2006 and 04.09.2006. Those consignments were received under Lot nos.44566 and 45084. Complainant was charged rent per the rates applicable for storing goods there. It is also not disputed that there was a fire at the warehouse on 07.11.2006 and in which the clove bags stored in chamber 38-L on the 5th Floor of the warehouse (of the Complainant) got completely gutted in fire. The fire, as alleged, was a result of short circuit and it spread to entire warehouse.

(3) It is further contended on behalf of the Complainant that it legitimately expected the warehouse to keep the consignment in a proper condition and protect the goods from wear and tear, damages. The poor maintenance, storing the goods in an unscientific manner and further allowing them to scatter all over the passage, and not maintaining the installations including electrical fittings in a proper manner, and allowing the goods being stored there beyond the capacity, resulted into the loss suffered by the Complainant and alleging deficiency in service on these counts a compensation is claimed to the extent of value of the goods stored and destroyed by fire. Complainant makes a claim of Rs.32,89,731/- towards value of the goods, further claimed interest @18% per annum over the said amount from the date of fire i.e. 7th November, 2006 till filing of the consumer complaint amounting to Rs.8,88,227/-, also claimed Rs.5,00,000/- as compensation towards mental and physical agony and Rs.2,00,000/- as costs.

(4) The Opponent opposed this complaint denying adverse averments made therein in toto. It categorically denied that there was any negligence shown in its part while storing the goods or maintaining the warehouse and that there is any deficiency in service as alleged by the Complainant on its part. They also have challenged the status of the Complainant as a consumer and that the present dispute is a consumer dispute within the meaning of Consumer Protection Act, 1986 (hereinafter referred to as ‘the Act’ for the sake of brevity).

(5) In support of their respective cases, on behalf of the Complainant Affidavit of Kshitij Garg dated 23.08.2011 is produced while on behalf of Opponent, Affidavit of Lalji Ramji Savla dated 14.06.2011 is produced. Complainant filed copies of various documents inter alia including translations of the original documents by one ‘Intime Translators’ without any affidavit. The documents inter alia includes circular dated 15.06.1995 whereby Government of India liberalized the policy as to public/private warehouses; brief profile of M/s.Savla Foods & Cold Storage Pvt. Ltd. i.e. Opponent; the fire Officer’s report i.e. Fire Report dated 31st January, 2007; as well as goods received note issued by the Opponent dated 31.08.2006 which on its reverse also mentioned the terms of conditions of the goods kept in the warehouse. These documents are referred by both the parties and they are not in dispute. Complainant tried to rely upon the panchanama of the fire prepared by the Police on 26.12.2006 but the same is not an admitted document and it is also not tendered in evidence by the Complainant as per provisions of Section 13(4) of the Act. This particular panchanama is important from the point of view that the Complainant alleged the deficiency in service on the part of warehouse for not scientifically storing the goods. As earlier observed, said panchanama is not tendered in evidence. However, for the sake of argument, even if it is held that said document could be read in evidence, it hardly supports or substantiates the summarization of the Complainant based upon it. A reference to the 5th floor, particularly, Chamber 38-L where the goods were store is made at pages 11 and 12 of the said panchanama. It only records the fact of destruction of the goods in fire. Undoubtedly, while extinguishing of the fire all the four walls of the warehouse broken, there were lot of activities which could be inferred while extinguishing the fire including the possibility of goods store in various chambers were destroyed. In such circumstances it is not indicative of the fact that the goods were stored in an unscientific manner in the passage etc.

(6) Furthermore, the fire report to which a reference is made earlier, does not mention that due to the unscientific storage of the goods the firemen experienced any difficulty to extinguish the fire. Said fire report also confirms that short circuit is the cause of fire but it does not mention from which floor or particular chamber/storage space, it occurred.

(7) The Opponent’s warehouse, as submitted and to which a reference is made in the affidavit of Kshitij Garg, that they have fulfilled all the norms of safety including the electric fittings and then only the Officials gave the requisite permission to start the warehouse. He also produced on record the copies of those permissions and they corroborate his evidence on affidavit. Therefore, this piece of evidence and which meets no rebuttal, can be safely accepted and relied upon. It rules out any case of negligence vis--vis deficiency in service on the part of the warehouse.

(8) Complainant alleged that they did not take delivery of the goods and requested the custom officials to keep the goods in a custom bonded cold storage and thereupon it is the custom officials who stored these goods in the warehouse of the Opponent. No doubt, the Complainant is charged rent for the goods being stored there but since the Complainant could take possession of the goods only after payment of the custom duty and release of those goods or part thereof by the custom officials. Therefore, if it is the custom department which as per the request of the Complainant availed the service of the Opponent warehouse. Even though the Complainant is made to pay rent for the storage, he cannot be held as direct consumer. He may be beneficial consumer, in view of the rent being charged on him but only if it falls in a category of a ‘consumer’ within the meaning of the section 2(1)(d)(ii) of the Act. For the reasons mentioned, infra, since the alleged service being hired for commercial purpose, the Complainant cannot be held as a consumer and as such it cannot be a consumer dispute. A useful reference to the point can be made to a decision of the apex court in the matter of Economic Transport Organisation V/s. Charan Spinning Mills (P) Ltd., reported in 2010 CTJ 361( SC).

(9) In the instant case, as alleged by the Complainant, particularly in paragraph 3 of the complaint, in due course of their business Complainant imported two containers containing 200 bags of 50 kg. of cloves in each container and out of these goods stored in the custom bonded cold storage i.e. the warehouse of the Complainant under which the reference is made earlier. It is further revealed from the statement made by the Complainant that the Complainant itself preferred to not to take delivery immediately but preferred to get it stored in the bonded warehouse so that as per its need it can get the required quantity on payment of custom’s duty on the same. It stored those goods for his business purpose and as further revealed from its another statement that out of those goods stored it had withdrawn at subsequent point of time, 85 bags of the cloves by paying the custom duty on them, for his business. Thus, in the given circumstances, Complainant stored the goods in the warehouse in question which were stored there on his behalf for the purpose of his business i.e. trading in cloves, as the part of his business activity. Therefore, in the background and circumstances of this particular case, the services of the warehouse for storing the goods were hired for commercial purpose and therefore, since apparently the case of the Complainant would not fall within the explanation to section 2(1)(d)(ii) of the Act, the Complainant is not a ‘consumer’.

(10) On behalf of the Complainant a reference is made to a decision of the Hon’ble National Commission in the matter of Harsolia Motors V/s.National Insurance Co.Ltd., decided on 3rd December, 2004 and also to the decision of Apex Court in the matter of Laxmi Enginenering Works V/s. P.S.G. Industrial Institute 1995(003) CTJ – 0289 SC, 1995-(003)-SCC-0583-SC. These authorities can be distinguished on the basis of the facts of this particular case to which a reference is made earlier. Undoubtedly, as observed by the Apex Court, the issue as to whether it is a business activity or a commercial activity for which services are hired depends upon the facts of each case.

(11) The phrase 'Business Activity' in the business dictionary of Internet (Investors Guide.Com; Business Dictionary.Com), defined it as 'the aggregate economic activities (buying selling, renting investing) of an organization or of the commercial and manufacturing sectors of an economy'. The free dictionary by FARLEX, defines the business activity as the activity undertaken as a part of commercial enterprise. In an article written by Alexis.W.; Edited by Heater Bailey, reproduced in Wise Geek (copyright protected 2003-12 by conjecture Corporation), the business activity is described as one which will depend hugely on the type of business b

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eing run. Generally, if the activity is required for the functioning of a given business enterprise or Company, it can be considered as business activity. In the instant case, for its own convenience and considering its own requirement, the consignment of cloves was allowed to be stored in the custom bonded storehouse i.e. Opponent’s warehouse, so that as a part of the trading whenever it is required, the Complainant could lay its hand on it by paying the custom duty. Thus, the goods are stored merely in the warehouse in the specified conditions of cold storage to preserve the goods properly instead of in a shop or in a trading place of the Complainant. But certainly it will not make a difference since they are stored for the purpose of trading in clove which amounts to business activity of the Complainant and therefore as at of commercial activity the goods are kept at the warehouse and, thus, services of the warehouse are hired for the commercial purpose. (12) For the reasons stated above, we hold accordingly and pass the following order: ORDER (i) Complaint stands dismissed. (ii) In the given circumstances, no order as to costs.