SC Clears The Air On The Section 13 (2) Of The Consumer Protection Act As Being Mandatory And No Extension Beyond The Said Period

A Constitution Bench of the Supreme Court recently in the case of ["New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage Pvt. Ltd.", MANU/SC/0272/2020] held that the time period to file the reply within forty five (30 days or such extended period, not exceeding 15 days) under Section 13 (2) of the Consumer Protection Act, 1986 is mandatory and there cannot be any extension beyond the said period.

Constitution Bench while answering the reference held as under;

"22. After noticing that there were delays in deciding the complaints by the District Forum, the legislature inserted sub­ Section (3A) of Section 13 of the Consumer Protection Act providing for a time limit for deciding the complaints. From this it is amply clear that the intention of the legislature was, and has always been, for expeditious disposal of the complaints. By providing for extension of time for disposal of the cases filed, for reasons to be recorded, the legislature has provided for a discretion to the Forum that wherever necessary, the extension of the time can be provided for, and where such further extension is not to be granted [as in the case of Section 13 (2)(a)], the legislature has consciously not provided for the same, so as to achieve the object of the Act."

The issue as to whether the time period as prescribed under Section 13 (2) of the Consumer Protection Act, 1986 for the filing the Reply is mandatory or directory was referred to Constitution Bench in the case of ["Bhasin Infotech & Infrastructure (P) Ltd. Vs. Grand Venezia Buyers Assn.", (2018) 17 SCC 255)] because of the following reason:

* The Hon'ble Supreme Court in this case observed that there is an apparent conflict between the decision in ["Topline Shoes Ltd. Vs. Corporation Bank" (2002) 6 SCC 33], ["Kailash Vs. Nankhu", (2005) 4 SCC 480], ["Salem Advocate Bar Association Vs. Union of India", (2005) 6 SCC 344] on the one hand and ["J. J. Merchant & Ors. Vs. Shrinath Chaturvedi", (2002) 6 SCC 635] and ["New India Assurance Company Limited Vs. Hilli Multipurpose Cold Storage", (2015) 16 SCC 20] on the other in so far as the power of the Courts to extend time for filing of Written Statement/reply to a Complaint is concerned.

* The Supreme Court in the case of ["Topline Shoes Ltd. Vs. Corporation Bank", (2002) 6 SCC 33] held that the provision of Section 13 of the Consumer Protection Act, 1986 as framed, does not indicate that it is mandatory in nature. In case, the extended time exceeds 15 days, does not prescribe any kind of period of limitation. The provision appears to be directory in nature, which the Consumer Forums are ordinarily supposed to apply in the proceedings before them. Thus, the Court held that, the reply of the Respondent could be taken on record beyond the period of 45 days. The provision is more by way of procedure to achieve the object of speedy disposal of such disputes.

* However, the Supreme Court in the same year in the case of ["J.J. Merchant (Dr) Vs. Shrinath Chaturvedi", (2002) 6 SCC 635], held that the National Commission or the State Commission is not empowered to extend the time period of 45 days as prescribed under Section 13 of the Consumer Protection Act, 1986. Further, it was noted that for speedy disposal, this legislative mandate of not giving more than 45 days in submitting the Written Statement or the version of the case is required to be adhered to. If this is not adhered to, the legislative mandate of disposing of the cases within three or five months would be defeated.

* Then in the case of ["New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage (P) Ltd.", (2015) 16 SCC 20], a Two Judge Bench of Justice Jasti Chelameswar & Justice H. R. Gokhale in the first order pronounced on November 29, 2013 condoned the delay of more than 45 days and allowed the appeal in view of the fact that J. Merchant Vs. Shrinath Chaturvedi (supra) has been re-considered and a different view has been taken in Kailash Vs. Nanhku (supra) on the issue of limitation. Also, noting the contradiction, this bench observed that as this point of law requires being resolved, it requested the Hon'ble the Chief Justice to place these appeals before a larger Bench, thus the matter was referred to a Three-Judge Bench. Subsequently, the matter was placed before the Three Judge bench so as to ascertain whether the law laid down in J. J. Merchant (supra) still holds the field or whether the law has been changed in view of the later Judgment delivered by Supreme Court in Kailash Vs. Nanhku (supra). Thereafter, on December 04, 2015 the said Three Judge Bench comprising of J Anil R. Dave, J Vikramajit Sen & J Pinaki Chandra Ghose ruled that no party will get more than 45 days for replying to a Complaint in a Consumer Forum. The Supreme Court expressed its opinion that the view expressed by the Three-Judge Bench of Supreme Court in J. J. Merchant (supra) should prevail and holds the field and, therefore, reiterated the view that the District Forum can grant a further period of 15 days to the opposite party for filing his version or reply and not beyond that.

Then finally, in the case of Bhasin Infotech case, a Two Judge Bench of the Supreme Court observed that there is an apparent conflict between the decisions of Supreme Court in "Topline Shoes Ltd. Vs. Corporation Bank" (supra), "Kailash Vs. Nanhku" (supra), "Salem Advocate Bar Assn. Vs. Union of India" (supra) on the one hand and "J. J. Merchant Vs. Shrinath Chaturvedi" (supra) and "New India Assurance Co. Ltd. Vs. Hilli Multipurpose Cold Storage (P) Ltd." (supra)  on the other insofar as the power of the Courts to extend time for filing of Written Statement/Reply to a Complaint is concerned. Therefore, the Ccourt observed that it would be more appropriate if the conflicts were resolved by an authoritative Judgment. Further, since the conflict was between conflicting Judgments of co-equal Benches i.e. comprising Three Judges, they deem it fit to refer these appeals to a Five-Judge Bench to resolve the conflict once and for all. They also noted that while they refer this to Three Judge Bench they are mindful of the fact that in the ordinary course, a Two-Judge Bench ought to make a reference to a Three-Judge Bench in the first place but in the facts and circumstances of the case and keeping in view the fact that the conflict is between coordinate Benches comprising three Judges, a reference to Three-Judge Bench may not suffice. Therefore, the matter shall be referred to Five-Judge Bench.

The Supreme Court in the instant case has held that Section 13 (2) of the Consumer Protection Act, 1986 is mandatory and no extension of time can be granted over and above the time period of 45 days. The following points briefly encapsulate the reasoning given by the Five Judges to to arrive at the following conclusion:

"Sub-section (2)(b)(ii) of Section 13 of the Consumer Protection Act, 1986  clearly provides for the consequence of the Complaint to be proceeded ex parte against the opposite party, if the opposite party omits or fails to represent his case within the time given. Therefore, since a provision has been provided that on failure of the Respondent to file its Reply within the stipulated time, the party would be proceeded ex-parte. Therefore, this provision is to be read as mandatory and not directory."

In the Statement of Objects and Reasons of the Consumer Protection Act, 1986 in Paragraph 4, it has been specifically provided that the Consumer Protection Act, 1986 is “To provide speedy and simple redressal to consumer disputes, a quasi­judicial machinery is sought to be set up at the district, State and Central levels…….”. The Preamble of the Consumer Protection Act also mentions that the Act is “to provide for better protection of the interests of the consumers”. The nomenclature of this Act also goes to show that it is for the benefit or protection of the consumer. From the above, it is evident that the Consumer Protection Act, 1986 has been enacted to provide for expeditious disposal of consumer disputes and that, it is for the protection and benefit of the consumer.

It would be convenient to re-produce Section 13 of the Consumer Protection Act, 1986 for better understanding of the controversy raised before the Constitution Bench of Supreme Court, which reads as under;

“Section 13. Procedure on admission of Complaint. – (1) The District Forum shall, on admission of a Complaint, if it relates to any goods,­

(a) refer a copy of the admitted Complaint, within twenty­-one days from the date of its admission to the opposite party mentioned in the Complaint directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen days as may be granted by the District Forum.

………………….......................

(2) The District Forum shall, if the Complaints admitted by it under Section 12 relates to goods in respect of which the procedure specified in sub­-section (1) cannot be followed, or if the Complaint relates to any services,­

(a) refer a copy of such Complaint to the opposite party directing him to give his version of the case within a period of thirty days or such extended period not exceeding fifteen days as may be granted by the District Forum;

(b) where the opposite party, on receipt of a copy of the Complaint, referred to him under clause (a) denies or disputes the allegations contained in the Complaint, or omits or fails to take any action to represent his case within the time given by the District Forum, the District Forum shall proceed to settle consumer dispute,­

(i) on the basis of evidence brought to its notice by the Complainant and the opposite party, where the opposite party denies or disputes the allegations contained in the Complaint, or

(ii) ex parte on the basis of evidence brought to its notice by the Complainant where the opposite party omits or fails to take any action to represent his case within the time given by the Forum;

(c) where the Complainant fails to appear on the date of hearing before the District Forum, the District Forum may either dismiss the Complaint for default or decide it on merits.

(3) No proceedings complying with the procedure laid down in subsections (1) and (2) shall be called in question in any Court on the ground that the principles of natural justice have not been complied with.

[(3A) Every Complaint shall be heard as expeditiously as possible and endeavour shall be made to decide the Complaint within a period of three months from the date of receipt of notice by opposite party where the Complaint does not require analysis or testing of commodities and within five months, if it requires analysis or testing of commodities:

Provided that no adjournment shall be ordinarily granted by the District Forum unless sufficient cause is shown and the reasons for grant of adjournment have been recorded in writing by the Forum:

Provided further that the District Forum shall make such orders as to the costs occasioned by the adjournment as may be provided in the regulations made under this Act.

Provided also that in the event of a Complaint being disposed of after the period so specified, the District Forum shall record in writing, the reasons for the same at the time of disposing of the said complaint.] 

[(3B) Where during the pendency of any proceeding before the District Forum, it appears to it necessary, it may pass such interim order as is just and proper in the facts and circumstances of the case.].

A bare reading of Section 13 (2)(a) of the Act makes it clear that the copy of the Complaint which is to be sent to the opposite party, is to be with the direction to give his version of (or response to) the case (or Complaint) within a period of 30 days. It further provides that such period of 30 days can be extended by the District Forum, but not beyond 15 days.

Sub­-Section 2 (b)(i) of Section 13 of the Act provides for a Complaint to be decided on the basis of the response by the opposite party and the evidence of the Complainant and the opposite party, where allegations contained in the Complaint are denied or disputed by the opposite party. Sub-­Section 2 (b)(ii) of Section 13 of the Act provides that where no response is filed by the opposite party, the Complaint may be decided ex parte on the basis of evidence brought forth by the complainant.

Sub­-Section 2 (c) of Section 13 of the Consumer Protection Act, 1986 further provides that where the Complainant fails to appear on the date of hearing before the District Forum, the District Forum may either dismiss the Complaint for default or decide it on merits. The aforesaid provision [sub-Section 2 (c)] was inserted by Act 62 of 2002, w. e. f. 15.03.2003. Similarly, Section (3A) of Section 13 of the Consumer Protection Act, 1986 which was also inserted by Act 62 of 2002, provides for deciding every Complaint as expeditiously as possible and endeavour shall be made to decide the Complaint within a period of three months from the receipt of notice by the opposite party, and within five months, if the Complaint requires analysis or testing of commodities. It also provides that no adjournment shall ordinarily be granted by the District Forum, and if the same is to be granted, costs may be imposed, and further that reasons be recorded if the complaint is disposed of after the time so provided.

From the above, it is clear that as mentioned in the Statement of Objects and Reasons of the Consumer Protection Act, 1986 the District Forum is to provide speedy disposal of consumer disputes. The same has been further reiterated by the legislature by insertion of Section 13 (2)(c) and 13 (3A) by Act 62 of 2002.

Section 13 of the Consumer Protection Act, 1986 clearly contemplates where time can be extended by the District Forum, and where it is not to be extended. Like, under sub­-Section (3A) of Section 13, despite the best efforts of the District Forum, in situations where the Complaint cannot be decided within the period specified therein, the same can be decided beyond the specified period for reasons to be recorded in writing by the District Forum at the time of disposing of the Complaint. Meaning thereby that the same would not be mandatory, but only directory. The phrase “endeavour shall be made”, makes the intention of the legislature evident that the District Forum is to make every effort to decide the case expeditiously within time, but the same can also be decided beyond the said period, but for reasons to be recorded.

On the contrary, sub-­Section (2)(a) of Section 13 of the Consumer Protection Act, 1986 provides for the opposite party to give his response ‘within a period of 30 days or such extended period not exceeding 15 days as may be granted by the District Forum’. The intention of the legislature seems to be very clear that the opposite party would get the time of 30 days, and in addition another 15 days at the discretion of the Forum to file its response. No further discretion of granting time beyond 45 days is intended under the Act.

It has been noted that by specifically enacting a provision under Sub-section (3) of Section 13, with a specific clarification that violation of the principles of natural justice shall not be called in question where the procedure prescribed under Sub-sections (1) and (2) of Section 13 of the Act has been followed or complied with, the intention of the legislature is clear that mere denial of further extension of time for filing the response (by the opposite party) would not amount to denial or violation of the principles of natural justice. Thus this provision of Section 13 (3) reinforces the time limit of 45 day, Section 15 of the Act has been reproduced herein below:

15. Appeal.—Any person aggrieved by an order made by the District Forum may prefer an appeal against such order to the State Commission within a period of thirty days from the date of the order, in such form and manner as may be prescribed:

Section 15 of the Act provides for filing of an appeal from the order of the District Forum to the State Commission within a period of 30 days.

However, it leaves discretion with the State Commission to entertain an appeal filed after the expiry of the said period of 30 days, if it is satisfied that there was sufficient cause for not filing it within the stipulated period. Similarly, discretion for filing an appeal before the National Commission beyond the period of 30 days has also been provided under Section 19 of the Act. There is a clear departure in the language of Section 13 (2)(a), 15 and 19 of the Act. It is evident that discretion has been provided to the forum in cases of appeal. However, no such discretion has been provided when it comes to filing the reply by the opposite party beyond the specified period of 45 days.

Supreme Court in the case of ["Lachmi Narain Vs Union of India", (1976) 2 SCC 953] held that “if the provision is couched in prohibitive or negative language, it can rarely be directory, the use of peremptory language in a negative form is per se indicative of the interest that the provision is to be mandatory”. Further, hardship cannot be a ground for changing the mandatory nature of the statute, as has been held by Supreme Court in ["Bhikraj Jaipurai Vs Union of India", AIR 1962 SC 113; (1962) 2 SCR 880] and ["Fairgrowth Investments Ltd. Vs Custodian", (2004) 11 SCC].

Hardship cannot thus be a ground to interpret the provision so as to enlarge the time, where the statute provides for a specific time, which, has to be complied in letter and spirit.

Supreme Court, in the case of ["Rohitash Kumar Vs Om Prakash Sharma", (2013) 11 SCC 451] has, in Paragraph 23, held as under:

“23. There may be a statutory provision, which causes great hardship or inconvenience to either the party concerned, or to an individual, but the Court has no choice but to enforce it in full rigor."

It is a well settled principle of interpretation that hardship or inconvenience caused, cannot be used as a basis to alter the meaning of the language employed by the legislature, if such meaning is clear upon a bare perusal of the statute. If the language is plain and hence allows only one meaning, the same has to be given effect to, even if it causes hardship or possible injustice.” While concluding, it was observed “that the hardship caused to an individual, cannot be a ground for not giving effective and grammatical meaning to every word of the provision, if the language used therein, is unequivocal.” Further, it has been held by this Court in the case of ["Popat Bahiru Govardhane Vs Special Land Acquisition Officer", (2013) 10 SCC 765] that the law of limitation may harshly affect a particular party but it has to be applied with all its vigour when the statute so prescribes and that the Court has no power to extend the period of limitation on equitable grounds, even if the statutory provision may cause hardship or inconvenience to a particular party.

Supreme Court while answering the question as to whether the limitation under Section 13 of the Consumer Protection Act, 1986 for filing the response by the opposite party to the Complaint would commence from the date of receipt of the notice of the Complaint by the opposite party, or the receipt of notice accompanied by a copy of the Complaint, held as under;

"40. Now reverting to the provisions of the Consumer Protection Act, a conjoint reading of Clauses (a) and (b) of sub­ Section (2) of Section 13 would make the position absolutely clear that the commencing point of limitation of 30 days, under the aforesaid provisions, would be from the date of receipt of notice accompanied by a copy of the Complaint, and not merely receipt of the notice, as the response has to be given, within the stipulated time, to the averments made in the Complaint and unless a copy of the Complaint is served on the opposite party, he would not be in a position to furnish its reply. Thus, mere service of notice, without service of the copy of the Complaint, would not suffice and cannot be the commencing point of 30 days under the aforesaid Section of the Act. We may, however, clarify that the objection of not having received a copy of the Complaint along with the notice should be raised on the first date itself and not thereafter, otherwise if permitted to be raised at any point later would defeat the very purpose of the Act, which is to provide simple and speedy redressal of consumer disputes.

41. To conclude, we hold that our answer to the first question is that the District Forum has no power to extend the time for filing the response to the Complaint beyond the period of 15 days in addition to 30 days as is envisaged under Section 13 of the Consumer Protection Act; and the answer to the second question is that the commencing point of limitation of 30 days under Section 13 of the Consumer Protection Act would be from the date of receipt of the notice accompanied with the Complaint by the opposite party, and not mere receipt of the notice of the Complaint."

Though the Court has settled the law here, one point which comes to our mind which should have been considered by the bench is the fact that although Sub-section (2)(b)(ii) of Section 13 of the Act talks about ex-parte proceedings, the entire Act does not explicitly give an impression of forfeiture of the right of the Opposite party to file its reply when we compare this with the language which has been used in the Commercial Courts Act. Detailed consideration of this point would have been necessary because of the fact that under the Commercial Courts Act, no extension beyond the statutory time period is possible as the Court do not have the power to grant an extension as the Parliament has deliberately provided that in case of failure to file the Written Statement, the right of the Defendant to file its Written Statement is forfeited and even the Court cannot allow the Written Statement to be taken on record. The relevant provision has been reproduced herein below:

"Provided further that where the defendant fails to file the Written Statement within the said period of thirty days, he shall be allowed to file the Written Statement on such other day, as may be specified by the Court, for reasons to be recorded in writing and on payment of such costs as the Court deems fit, but which shall not be later than one hundred twenty days from the date of service of summons and on expiry of one hundred twenty days from the date of service of summons, the defendant shall forfeit the right to file the written statement and the Court shall not allow the written statement to be taken on record"