2021 INSC 0841 1 Reportable IN THE SUPREME COURT OF INDIA CIVIL APPELL ATE JURISDICTION Civil Appeal No . 7546 of 2021 Diamond Exports & Anr . ....Appellant s Versus United India Insurance Company Limited & Ors. .... Respondent s J U D G M E N T Dr Dhananjaya Y Chandrachud, J 1 This appeal arises from a judgment dated 25 February 2020 of the National Consumer Disputes Redressal Commission 1. 2 While entertaining IA Nos 15390 of 2019, 15391 of 2019 and 18307 of 2019 in Consumer Complaint No 2645 of 2018, the NCDRC has condoned the delay of 100 days in filing a written statement. The order of the NCDRC was a few days before the judgment of a Const itution Bench dated 4 March 2020, in New India 1 “NCDRC” 8 Timbers & Hardwares (P) Ltd. , (2021) 3 SCC 673] is concerned, the same has been dealt with in detail by the National Commission by the impugned order [ Daddy's Builders (P) Ltd. v. Manisha Bhargava, 2020 SCC OnLine NCDRC 697] while deciding the first appeal. As rightly observed by the National Commission, there was no mandate that in all the cases w here the written statement was submitted beyond the stipulated period of 45 days, the delay must be condoned and the written statement must be taken on record. In order dated 10- 2-2017 [ Reliance General Insurance Co. Ltd. v. Mampee Timbers & Hardwares (P) Ltd. , (2021) 3 SCC 673] , it is specifically mentioned that it will be open to the Fora concerned to accept the written statement filed beyond the stipulated period of 45 days in an appropriate case, on suitable terms, including the payment of costs and to proceed with the matter. Therefore, ultimately, it was left to the Fora concerned to accept the written statement beyond the stipulated period of 45 days in an appropriate case. ” The Court also referred to the decision of the Constitution Bench in the following terms: “7. As observed by the National Commission that despite sufficient time granted the written statement was not filed within the prescribed period of limitation. Therefore, the National Commission has considered the aspect of condonation of delay on merits also. In any case, in view of the earlier decision of this Court in J.J. Merchant [J.J. Merchant v. Shrinath Chaturvedi, (2002) 6 SCC 635] and the subsequent authoritative decision of the Constitution Bench of this Court in New India Assuranc e Co. Ltd. v. Hilli Multipurpose Cold Storage (P) Ltd. [New India Assurance Co. Ltd. v. Hilli Multipurpose Cold Storage (P) Ltd., (2020) 5 SCC 757 : (2020) 3 SCC (Civ) 338] , Consumer Fora have no jurisdiction and/or power to accept the written statement b eyond the period of 45 days, we see no reason to interfere with the impugned order [Daddy's Builders (P) Ltd. v. Manisha Bhargava, 2020 SCC OnLine NCDRC 697] passed by the learned National Commission.” 9 12 A few months after the decision in Daddy’s Builders ( supra), on 8 July 2021, a two -judge Bench of this Court in Dr A Suresh Kumar v. Amit Agarw al 9 considered a factual s ituation where the NCDRC summarily dismissed an application for condonation of delay filed before the decision of the Constitution Bench in New India Assurance Company Limited (supra). The Court in Dr A Suresh Kumar (supra) held that since the decision of the Constitution Bench was to operate with prospective effect, applications for condonation of delay filed before 4 March 2020 ought to be considered on merits: “2. In our view, since the application for condonation of delay was filed prior to the judgment of the Constitution Bench, which was delivered on 4-3 -2020 [New India Assurance Co. Ltd. v. Hilli Multipurpose Cold Storage (P) Ltd., (2020) 5 SCC 757 : (2020) 3 SCC (Civ) 338] , the said application for condonation of delay ought to have been considered on merits and should not have been dismissed on the basis of the Constitution Bench judgment in New India Assurance Co. Ltd. [New India Ass urance Co. Ltd. v. Hilli Multipurpose Cold Storage (P) Ltd., (2020) 5 SCC 757 : (2020) 3 SCC (Civ) 338] because the said judgment was to operate prospectively and the written statement as well as the application for condonation of delay had been filed much prior to the said judgment. Accordingly, the impugned order [Amit Agrawal v. A. Suresh Kumar, 2020 SCC OnLine NCDRC 927] of Ncdrc deserves to be, and is, hereby set aside.” T he decision in Dr A Suresh Kumar (supra) did not notice the observation of a pri or bench of co- equal strength in Daddy’s Builders (supra). 13 The divergence between the positions in Dr A Suresh Kumar (supra) and Daddy’s Builders (supra) in interpreting the prospective effect of the decision of the 9 (2021) 7 SCC 466 [“Dr. A Suresh Kumar”] 10 Constitution Bench in New India Assurance Company Limited (supra) was recently noticed on 6 December 2021 by a two-judge Bench of this Court in Bhasin Infotech and Infrastructure Private Ltd. v. Neema Agarwal and Others 10. The Court was considering a consumer complaint and an application for condonation of delay which were filed before 4 March 2020 but decided after the decision of the Constitution Bench. The Court noted the conflicting positions in the following terms: “9. Two contrary views have emerged as regards what would be meant by the phrase….. “This judgment to operate prospectively” mandated in the Constitution Bench judgment. In the case of Daddy's Builders Private Limited (supra), the application for condonation of delay had been rejected by the State Commissi on prior to the Constitution Bench opinion on the aspect of power and jurisdiction of the consumer fora to condone delay beyond the stipulated 45 days in filing written submission/reply. The appeal against that decision was rejected by the NCDRC on 4th September, 2020, following the Constitution Bench decision. On prospective operation of the Constitution Bench Judgment, opinion of the Coordinate Bench in the case of Daddy's Builders Private Limited (supra) was that the prospective operation of the judgment would apply only in cases where delay stood condoned on a date prior to 4th March, 2020. In expressing this view, the Coordinate Bench noted that one of the members of the Bench was also a party to the said Constitution Bench decision. The position, as regards composition of the Bench is similar in the case of Dr. A. Suresh Kumar (supra) and in that judgment, a more liberal approach has been adopted. The prospectivity of the Constitution Bench decision has been held to cover cases where an application for condonation of delay was filed prior to the judgment of the Constitution Bench, but whose outcome was yet to be determined at the time the Constitution Bench judgment was delivered.” 10 2021 SCCOnLine SC 1186 [“Bhasin Infotech -2021”] 11 The two- judge Bench in Bhasin Infotech -2021 (supra) followed the line of precedent in Dr A Suresh Kumar (supra) and noted that the prospective effect of the Constitution Bench would preserve the benefit of the position laid down in Reliance General Insurance Company (supra) concerning applications for condonation that had been pending or decided as of 4 March 2020: “10. In our view, the prospective operation of the Judgment in the case of New India Assurance Company Limited (supra) ought to cover both sets of the cases in which delay in filing written reply stood condoned after accepting the application for condonation of delay in filing written statement/reply as well as the cases where the decision on condonation of delay in filing written replies were pending on 4th March, 2020. Once an application is filed for condonation of delay, there may be cases where such applications are decided upon on dates earlier than applications already filed but yet to be determined. We do not have any laid down administrative mechanism to decide in what manner applications of this nature would be decided and the consumer fora or the Courts apply their own discretion on the basis of various relevant factors involved in individual cases, to prioritise their hearing. In our opinion, it would be artificial distinction to distinguish between applicat ions for condonation of delay already decided before 4th March, 2020 and the applications for condonation of delay pending on that date. So far as persons with pending applications for condonation of delay in filing written replies are concerned, their right to have their applications for condonation of delay in filing written replies to be considered, would stand crystallised on 4th March, 2020. Such right has also been recognised in the case of Reliance General Insurance Company Limited (supra). Such right could be extinguished only by specific legal provisions. In the event the Constitution Bench judgment had altogether negated the right to have delay in filing written statement condoned beyond the period of 45 days, the right of such applicants could stand extinguished. But as the judgment of the Constitution Bench is to operate prospectively, in our understanding of the said judgment, those with pending applications for condonation of delay would retain their right to have their applications considered. But we refrain from expressing any definitive opinion on this point as the two 12 Benches of equal strength have taken differing views on the manner in which the prospective application of the Constitution Bench judgment would be affected. In our opinion, thi s issue ought to be decided by a larger Bench.” However, in view of the conflicting position in Daddy’s Builders (supra), the two- judge Bench in Bhasin Infotech -2021 (supra) sought the reference of the matter to a larger bench. 14 To recapitulate, in Daddy’s Builders (supra), this Court refused to interfere in a decision of the NCDRC which had affirmed the judgment of the SCDRC rejecting the application for condonation. The application for condonation had not been entertained on merits. However, there are observations in Daddy’s Builders (supra) , based on the decision of the Constitution Bench, which state that a delay beyond the outer limit prescribed by Section 13 could not have been condoned. While this is the position which emerges from the decision of the Constitution Bench, the decision has been made prospective. In Daddy’s Builders (supra) the application for condonation had been filed before the decision of the Constitution Bench and had been rejected on merits. Strictly speaking, the observations in Daddy’s Builders (supra) were not necessary for its decision since, even on merits, no case for condonation had been found by the NCDRC in that case. As noted above, this Court in Daddy’s Builders (supra) after noticing the decision in Reliance General Insurance Company (supra) held that it left the discretion to be exercised by the fora during the pendency of the reference to the Constitution Bench and in that case, the NCDRC found no reason to condone the delay. The 13 subsequent observation of this Court in Daddy’s Builders (supra) w hich implies that the principle laid down by the Constitution Bench will even apply to applications for condonation filed prior to the decision of the Constitution Bench were unnecessary (once it had been held that even on m erits there was no case for condonation). Moreover, those observations are with respect not consistent with the legal position that the Constitution Bench gave prospective effect to its decision. 15 The discretion for condonation of delay under Section 13 of the Consumer Protection Act 1986 is specifically circumscribed by the statute. Similar statutory provisions exist in the Arbitration and Conciliation Act 2015 and the Insolvency and Bankruptcy Code 2016 though in a different statutory context – facilitating the sanctity of the arbitral process in the former and the legislative intent of ensuring timely disposal and corporate rehabilitation in the latter . The Consumer protection Act 1986 and its suc cessor are social welfare legislations designed to protect the interests of consumers. The Constitution Bench had thus noted: “28. It is true that “justice hurried is justice buried”. But in the same breath it is also said that “justice delayed is justice denied”. The legislature has chosen the latter, and for a good reason. It goes with the objective sought to be achieved by the Consumer Protection Act, which is to provide speedy justice to the consumer. It is not that sufficient time to file a response to the complaint has been denied to the opposite party. It is just that discretion of extension of time beyond 15 days (after the 30 days' period) has been curtailed and consequences for the same have been provided under Section 13(2)(b)(ii) of the Consumer Protection Act. It may be that in some cases the opposite party could face hardship because of such provision, yet for achieving the object of the Act, which is speedy and simple redressal of consumer disputes, hardship which may be caused to a party has t o be ignored.” 14 This was owing to the social welfare intention of the consumer protection legislation, which essentially seeks to protect the rights of consumers who avail of myriad goods and services . The welfare of litigating c onsumers has been the guiding principle for interpreting several procedural and substantive questions arising out of the Consumer Protection Act 1986. Recently, a t wo-judge Bench considered the effect of the Consumer Protection Act 2019 which amended the pecuniary jurisdiction of consumer fora, on pending proceedings. In arriving at its decision, the Court noted: “82. It would be difficult to attribute to Parliament, whose purpose in enacting the Act of 2019 was to protect and support consumers with an intent that would lead to financial hardship, uncertainty and expense in the conduct of consumer litigation….” A similar principle is inherent in the decision of the Constitution Bench in New India Assurance Company Ltd. (supra). However, given the conflicting decisions concerning the nature of such discretion, the Constitution Bench considered it appropriate to give prospective effect to the decision. It did not make a distinction between applications for condonation which had been decided and those which were pending on the date of the decision. Thus, the decision in Daddy’s Builders (supra) would not affect applications that were pending or decided before 4 March 2020. Such applications for condonation would be entitled to the benefit of the position in Reliance Gen eral Insurance Company Limited (supra) which directed consumer fora to render a decision on merits. We have expounded on the above principles in order to adopt a bright -line standard which obviates uncertainty on the legal position before the consumer fora and obviates further litigation. 15 16 In the present case, before the decision of the Constitution Bench, the delay was condoned by the NCDRC by furnishing reasons for the exercise of such discretion. Having regard to the prospective effect of the judgment of the Constitution Bench in New India Assurance Company Limited (supra) and the order s of this Court in Reliance General Insurance Company Limited (supra) and Bhasin Infotech -2018 (supra) , which had recognized an element of discretion pending the reference, we are of the considered view that no case for interference is made in the order of the NCDRC allowing the application for condonation of delay on merits . 17 Learned counsel for the appellant states that the payment of costs of Rs 50,000 could not be effected because of the lockdown, but a demand draft is ready. The amount shall be transmitted into the account stipulated by the NCDRC within two weeks. 18 Liberty is granted to the appellants to file their replication within a period of four weeks. 16 19 The appeal is accordingly disposed of. 20 Pending applications, if any, stand disposed of. …….…………………………...............................J. [Dr Dhananjaya Y Chandrachud] …….…………………………...............................J. [Surya Kant ] …….…………………………...............................J. [Vikram Nath] New Delhi; December 14, 2021