/2023 INSC 0282/
REPORTABLE
IN THE SUPREME COURT OF INDIA
CIVIL APPELLATE JURISDICTION
CIVIL APPEAL NO(S).5352­5353 OF 2007
NATIONAL INSURANCE CO. LTD.  ….APPELLANT(S)
VERSUS
HARSOLIA MOTORS AND OTHERS ….RESPONDENT(S)
WITH
CIVIL APPEAL NO(S).5354 OF 2007
CIVIL APPEAL NO(S).2821 OF 2012
CIVIL APPEAL NO(S).3350 OF 2018
CIVIL APPEAL NO(S).            OF 2023
(@ SPECIAL LEAVE PETITION (CIVIL) NO(S).1039 OF 2020)
J U D G M E N T
Rastogi, J.
CIVIL APPEAL NO(S).5352­5353 OF 2007
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1. The   assail   in   the   present   appeals   by   special   leave   is   to
judgment   and   order   passed   by   the   National   Consumer   Disputes
Redressal   Commission   (hereinafter   “National   Commission”)   dated
3 rd
  December,   2004,   whereby   the   National   Commission,   while
reversing   the   finding   of   the   Gujarat   State   Consumer   Disputes
Redressal   Commission   (hereinafter   “State   Commission”),   regarding
maintainability   of   the   complaint   filed   at   the   instance   of   the
respondent   under   the   Consumer   Protection   Act,   1986   (hereinafter
“Act, 1986”) held that a person who takes insurance policy to cover
the   envisaged   risk   does   not   take   the   policy   for   the   commercial
purpose.   Policy is only for indemnification of an actual loss and is
not intended to generate profits and finally held that the respondent
(insured)   was   a   consumer   as   defined   under   Section   2(1)(d)   of   the
Act, 1986 and the complaint filed at his instance was maintainable
and be examined by the State Commission on merits.  
2. Respondent   no.1   (dealer   in   TATA   vehicles)   and   respondent
no.2 are the claimants.   Respondent no.1 took out a fire insurance
policy   with   the   appellant   for   a   cover   of   Rs.75,38,000/­   and
respondent no.2 for a cover of Rs.90 lakhs.   That on 28 th
 February,
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2002,  damage was  caused  to  the goods  of respondent  nos.1  and 2
due   to   fire   (during   the   course   of   Godhra   riots).       The   appellant
denied   the   claim   of   respondent   no.1,   while   admitting   the   claim   of
respondent no.2 to the extent of Rs.54,29,871/­.   The respondents
filed complaint before the State Commission. 
3. Respondent   no.1   M/s   Harsolia   Motors,   a   commercial   entity
engaged   in   the   business   of   sale   of   vehicles,   took   fire   insurance
policy   from   the   appellant   insurance   company   covering   the   office,
showroom, garage, machinery lying in the showroom premises, etc.
The   grievance   of   the   respondent   was   that   their   aforesaid   premises
were   damaged   during   the   Godhra   riots   on   28 th
  February,   2002.   A
complaint was instituted by the respondent, M/s Harsolia Motors, a
partnership firm, before the State Commission, for compensation of
damage   caused   on   the   ground   that   post­Godhra   incident,   which
took   place   on   27 th
  February,   2002,   riots   broke   out   resulting   into
complainant’s goods being destroyed by fire set up by rioters on 28 th
February, 2002 and the respondent/complainant was entitled to be
indemnified the insured sum under the policy of insurance.  
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4. The State Commission held that the respondent is not covered
under the expression “consumer” as defined under Section 2(1)(d) of
the   Act,   1986   and   held   that   the   complainant   being   a   company
running a business from the premises to earn profits falls under the
term   “for   commercial   purpose”   and   the   complaint   is   not
maintainable under the provisions of the Act, 1986.   
5. On an appeal being preferred by the respondent insured before
the   National   Commission,   the   question   arose   as   to   whether   the
insurance   policies  taken   by  a   commercial  unit   could   be   held  to   be
hiring  of  services  for  commercial  purpose  and   are  hereby  excluded
from the provisions of the Act, 1986 after revisiting the provisions of
the   Act,   1986   and   the   definition   of   the   terms   “consumer”   and
“service”   as   defined   under   Section   2(1)(d)   and   2(1)(o)   of   the   Act,
1986,   respectively   the   Commission   recorded   a   finding   that   the
expression used “for any commercial purpose” would mean that the
goods   purchased   or   services   hired   should   be   used   in   any   activity
directly   intended   to   generate   profit   and   profit   is   the   main   aim   of
commercial   purpose,   but   in   a   case   where   goods   purchased   or
services hired in an activity which is not intended to generate profit,
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it would not  be a commercial purpose and held that a person  who
takes   the   policy   of   insurance   to   cover   the   envisaged   risk,   for
indemnification of actual loss suffered is not ordinarily intended to
generate   profits   and   accordingly   held   that   the
respondent/complainant was a “consumer” under Section 2(1)(d) of
the   Act,   1986   and   complaint   filed   at   its   instance   is   to   be
examined/decided   by   the   State   Commission   on   its   own   merits
under   the   judgment   impugned   dated   3 rd
  December,   2004,   is   a
subject   matter   of   challenge   in   appeal   before   this   Court   at   the
instance of the appellant insurance company.   
6. While   the   notices   were   issued   by   this   Court   on   15 th
  April,
2005,   the   operation   and   effect   of   the   judgment   impugned   was
stayed.   In consequence thereof, the complaint filed at the instance
of the respondent has not been examined by the State Commission
on merits so far.
7. The other  batch of appeals which were heard along  with Civil
Appeal   No(s).5352­5353   of   2007   (National   Insurance   Co.   Ltd.   v.
Harsolia   Motors   and   Others)   arising   from   the   judgment   of   the
National   Commission,   placing   reliance   on   the   impugned   judgment
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dated   3 rd
  December,   2004,   applying   the   self­same   principles   are
also challenged at the instance of the appellant insurer before us.
8. The   seminal   issue   that   emanates   for   our   consideration   is
whether the insurance policy taken by the respondent (commercial
enterprises)   insured   amounts   to   hiring   of   services   for   “commercial
purpose”   thereby   excluded   from   the   purview   of   the   expression
“consumer” as defined under Section 2(1)(d) of the Act, 1986.
9. Learned   counsel   for   the   appellant   submits   that   there   cannot
be  a   blanket  inclusion   of  all   insurance  matters  within   the  purview
of   Act,   1986   and   if   that   is   being   taken   at   the   face   value,   it   would
render   the   provisions   of   the   Commercial   Courts   Act,   2015
(hereinafter “Act, 2015”) nugatory and submits that Section 2(1)(XX)
of   the   Act,2015   includes   insurance   and   re­insurance   within   the
ambit of commercial disputes.  
10. Learned   counsel   further   submits   that   law   on   the   subject   has
been   examined   by   this   Court   in   Laxmi   Engineering   Works   v.
P.S.G.   Industrial   Institute 1
  and   it   was   held   that   “commercial
purpose”   is   to   be   looked   into,   in   the   facts   and   circumstances   of
1  (1995) 3 SCC 583
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each case to consider the purpose for which the goods and services
are   bought   or   availed.     If   it   is   availed   with   a   view   to   carrying   out
large   scale   commercial   activity   with   profit   motive,   then   the   buyer
would   not   qualify   as   a   consumer   and   the   Act,   1986   would   not   be
applicable and the view of this Court has been consistently affirmed
in the later judgments.  
11. Learned   counsel   further   submits   that   the   Commission   in   its
second last para explicitly takes the very policy of insurance within
the purview of the Act, 1986 and in sequel thereof, regardless of the
nature   of   transaction,   whenever   there   is   a   claim   for   compensation
in   reference   to   the   policy   of   insurance,   such   complaints   became
maintainable under the Act, 1986.   
12. Learned   counsel   further   submits   that   dominant   purpose   of
obtaining   insurance   contracts   by   the   business   entities   is   to   earn
profits   and   thus   has   a   close   and   direct   nexus   with   it   and
accordingly these entities are not entitled to file the claim before the
Consumer   Court   seeking   summary   proceedings   and   the   present
disputes   are   not   of   a   small   disgruntled   consumer   who   is   seeking
claim   of   an   insurance   for   loss   of   mobile   for   personal   use,   or   of
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autorickshaw driver seeking claim for expenses incurred for fixing a
defective   engine   as   that   is   covered   for   his   livelihood.   The   instant
dispute   pertains   to   large   scale   business   entities   entering   into
commercial   agreements   with   the   insurance   companies   to   protect
the   risks   associated   in   carrying   out   their   businesses.     If   they   are
being permitted to invoke the jurisdiction as a consumer under the
Act,   1986,   it   will   frustrate   the   very   mandate   of   the   legislative
wisdom, pursuant to which this Act has been enacted. 
13. Learned   counsel   further   submits   that   the   doctrine   of   election
is   not   available   to   the   litigant   who   is   aggrieved   by   the   insurance
contract as   Section  2(1)(d) of the Act, 1986 and Section  2(7) of the
Consumer   Protection   Act,   2019   Act   specifically   exclude   the
provisions   of   services   “for   commercial   purpose”   from   the   ambit   of
consumer courts and the only remedy lies to the commercial courts
under the Act, 2015.  
14. Learned  counsel   submits  that   if  contention   to   the  contrary  of
insurance   for   commercial   activities   falling   within   the   ambit   of   the
Act,   1986   is   to   be   accepted,   then   obtaining   any   service   for   any
commercial   activity   even   for   facilitating   profit   generation   for
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commercial enterprise would fall within  the expression  “consumer”
as defined under Section 2(1)(d) of the Act, 1986   and it would lead
to   improbability   as   it   would   go   against   the   basic   tenets   of   service
being   used   for   commercial   ends   whose   violation   give   rise   to   civil
action and not consumer redressal.   
15. Learned   counsel   further   submits   that   if   the   respondent’s
submission  of insurance  as a  service  availed  by   any  person  within
the meaning of the Act is accepted, this would entail an exponential
growth   of   consumer   disputes   across   the   country,   not   only   would
that lead to frustration of literal spirit and intent of the socially and
economically beneficial legislation, rather it would inadvertently give
rise   to   the   premiums   charged   by   the   insurance   company   which
would   again   subserve   the   overall   intent   of   the   Act,   as   actual
consumers who regularly avail the services will have to pay more for
the same coverage and this can be taken note from the Statement of
Objects   and   Reasons   which   was   kept   in   mind   for   the   purpose   of
making the amendment in the year 2002.  
16. Learned counsel lastly submits that the purchase of insurance
policy   has   a   direct   nexus   with   the   commercial   activity   in   a   large­
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scale   enterprise.   In   other   words,   the   insurance   policy   indemnifies
the   company   against   loss   arising   out   of   fire,   earthquake   or   any
other insured peril.  What is reimbursed by the insurance company
is   a   loss   and   loss   is   directly   interlinked   with   the   commerce   of   the
company   and,   therefore,   a   complaint   seeking   reimbursement   of   a
loss   would   not   be   maintainable   before   the   Consumer   Court   if   it   is
filed   by   a   large­scale   commercial   entity   like   the   respondent   herein
and the interpretation addressed by the National Commission of the
provisions of the Act, 1986 not only runs contrary to the judgments
of this Court, it is otherwise not legally sustainable and deserves to
be interfered by this Court.
17. Per   contra,   learned   counsel   for   the   respondent,   submits   that
the   purchase   of   insurance   policy   cover   is   a   contract   of
indemnification of particular risk and not a contract of doing or not
doing   something   to   earn   profit/loss   out   of   such   act.   If   the
contemplated risk out of particular  eventuality  i.e., fire, flood, etc.,
does   not   occur,   then   there   is   no   question   of   encashment   of   policy
cover,   and   if   this   happens   what   is   payable   is   the   risk   amount
against   premium   paid   in   advance.     Under   the   circumstances,   the
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insurance   policy   cover   is   being   offered/purchased   not   basically   to
earn profit, but to cover the uninvited risk, hence, buying of policy
cover   is   not   for   commercial   purpose   even   if   it   is   purchased   by
commercial   enterprises   and   what   is   commercial   purpose   is   well
defined not only in several dictionaries but also in the judgments of
this Court and submitted that it may be noticed that the Act, 1986
bars only a transaction for “commercial purpose” but it does not bar
any   commercial   enterprise   to   be   a   consumer   and   hence   the
commercial   enterprise   can   be   a   buyer/consumer   and   can   enforce
its   rights   as   a   consumer,   provided   immediate   intent   is   to   generate
profit out of such transaction by the commercial enterprise, as held
by   this   Court   in   Madan   Kumar   Singh   (Dead)   Through   LR.   v.
District Magistrate, Sultanpur and Others 2
. 
18. Learned   counsel   further   submits   that   any   transaction   by
commercial   enterprises   even   without   immediate   intention   to   make
profit   cannot   be   regarded   for   “commercial   purpose”,   otherwise   all
transactions   by  commercial   enterprises   may   or   may   not   have  even
remote co­relation of generating profit will be treated for commercial
2  (2009) 9 SCC 79
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purposes.   Say, for example, a company buying a water plant for its
workers   or   for   any   stranger/outsider   to   serve   free   water   ­   or   paint
tins in bulk for upgrading walls etc. have no direct effect of earning
profit   out   of   it.     Thus,   buying   a   water   plant   cannot   be   treated   for
commercial   purpose,   otherwise   virtually   all   transactions   by
commercial   enterprise   will   get   colour   of   commercial   purpose   and
had it been such an intention of the legislature, then it would have
worded   the   definition   of   term   “consumer”   differently   –   instead   of
“any   person”   would   have   used   “any   person   other   than   commercial
enterprises”,   but   the   statute   in   its   wisdom   has   allowed   to   cover
commercial   transaction   with   commercial   purpose.   Therefore,   the
transactions   by   the   commercial   enterprises   per   se   cannot   be
considered as an exclusion altogether under the Act, 1986.    
19. We  have  heard   learned   counsel   for   the   parties   and  with   their
assistance perused the material available on record.
20. Before   we   proceed   to   examine   the   issue   raised   for   our
consideration, it will be apposite to take a bird’s eye­view of the Act,
1986. 
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21. The   Act,   1986   is   a   social   benefit­oriented   legislation   and,
therefore,   the   Court   has   to   adopt   a   constructive   liberal   approach
while   construing   the   provisions   of   the   Act.     To   begin   with   the
Preamble   of   the   Act,   1986   which   can   afford   useful   assistance   to
ascertain the legislative intention, it was enacted to provide for the
protection   of   the   interests   of   consumers.     Use   of   the   word
“protection”   furnishes   key   to   the   minds   of   makers   of   the   Act.
Various   definitions   and   provisions   which   elaborately   attempt   to
achieve   this   objective   have   to   be   construed   in   this   light   without
departing   from   the   settled   law   that   a   Preamble   cannot   control
otherwise plain meaning of a provision.    
22. In   fact,   the   law   meets   long   felt   necessity   of   protecting   the
common   man   from   such   wrong   for   which   the   remedy   under
ordinary   law   for   various   reasons   has   become   illusory.     Various
legislations   and   regulations   permitting   the   State   to   intervene   and
protect interests of the consumers  have   become   a   haven   for
unscrupulous   ones   as   the   enforcement   machinery   either   does   not
move or it moves ineffectively and inefficiently for reasons which are
not necessary to be stated. 
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23. The   importance   of   the   Act   lies   in   promoting   welfare   of   the
society   by   enabling   the   consumer   to   participate   directly   in   the
market   economy.       A   scrutiny   of   various   definitions   such   as
“consumer”, “service”, “trader”, “unfair trade practice” indicates that
legislature has attempted to widen the ambit and reach of the Act.
Each of these definitions are in two parts, one explanatory and the
other   inclusive.     The   explanatory   or   the   main   part   itself   uses
expressions of amplitude indicating clearly its wide sweep within its
ambit   to   widen   such   things   which   otherwise   would   have   been
beyond its natural import.
24. The   provisions  of   the   Act,  1986   thus  have  to   be  construed  in
favour of the consumer to achieve the purpose of enactment as it is
a   social   benefit­oriented   legislation.   The   primary   duty   of   the
Court/Commission   while   construing   the   provisions   of   such   an   Act
is to adopt a constructive approach subject to that it should not do
violence   to   the   language   of   the   provisions   and   is   not   contrary   to
attempted objective of the enactment. 
25. Section   2(1)(d)   defines   “consumer”,   Section   2(1)(m)   defines   “a
person”   and   Section   2(1)(o)   defines   “service”,   which   are   relevant   to
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examine   the   moot   question   raised   for   our   consideration   are
reproduced hereunder:
“2. Definitions. ­  In this Act, unless the context otherwise requires,­
……..
(d)  "consumer"  means any person who­ 
(i)   buys   any   goods   for   a   consideration   which   has   been   paid   or
promised or partly paid and partly promised, or under any system
of   deferred   payment   and   includes   any   user   of   such   goods   other
than   the   person   who   buys   such   goods   for   consideration   paid   or
promised or partly paid or partly promised, or under any system of
deferred   payment   when   such   use   is   made   with   the   approval   of
such   person,   but   does   not   include   a   person   who   obtains   such
goods for resale or for any commercial purpose; or 
(ii) hires or  avails  of any  services for  a  consideration which has been
paid or promised or partly paid and partly promised, or under any
system   of   deferred   payment   and   includes   any   beneficiary   of   such
services   other   than   the   person   who   hires   or   avails   of   the   services
for   consideration   paid   or   promised,   or   partly   paid   and   partly
promised,   or   under   any   system   of   deferred   payments,   when   such
services   are   availed   of   with   the   approval   of   the   first­mentioned
person; 
Explanation:   For   the   purposes   of   sub­clause   (i),   "commercial
purpose" does not include use by a consumer of goods bought and
used   by   him   exclusively   for   the   purpose   of   earning   his   livelihood,
by means of self­employment;
……
(m)  "person"  includes­ 
(i)   a firm whether registered or not; 
(ii)  a Hindu undivided family; 
(iii) a co­operative society; 
(iv)   every   other   association   of   persons   whether   registered   under   the
Societies Registration Act, 1860 (22 of 1860) or not;
…….
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(o)  "service"  means service of any description which is made available
to potential users and includes the provision of facilities in connection
with   banking,   financing,   insurance ,   transport,   processing,   supply   of
electrical   or   other   energy,   board   or   lodging   or   both,   [housing
construction], entertainment, amusement or the purveying of news or
other   information,   but   does   not   include   the   rendering   of   any   service
free of charge or under a contract of personal service.”
26. The word “consumer” is the fulcrum of the Act.   Since the Act
hinges on the twin concepts of defect in goods or any deficiency in
service, a consumer is one who buys any goods or hires any service.
The term “consumer” has, thus, been defined to mean a person who
is –
(a) a buyer, or 
(b) with   the   approval   of   the   buyer,   the   user,   of   the   goods   in
question, or 
(c) a hirer or person otherwise availing, or 
(d) with the approval of such aforesaid persons, the beneficiary, of
the service or services in question
With   the   condition   super   added   that   such   buying   of   the   goods   or
hiring or availing of any such service, is for a consideration, ­
(i) paid, or
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(ii) promised, or
(iii) partly paid or promised, or 
(iv) covered by any system of deferred payment. 
27. However,   the   word   “consumer”   so   defined   does   not   include   a
person,   who,   in   case   of   goods   obtains   such   goods   for   resale   or   for
any  commercial  purpose,  or  who,   in  case of  service,  avails  of  such
services,   for   any   commercial   purpose.   An  explanation   appended   to
the   above   definition   states   that   the   expression   “commercial
purpose” does not include the use by the buyer of such goods or the
person availing such service or services, exclusively for the purpose
of earning his livelihood by means of self­employment. 
28. It   may   be   noticed   that   Section   2(1)(m)   defines   “person”   and
includes   a   firm,   whether   registered   or   not,   apart   from   other
categories   without   any   distinction,   big   or   small.     So,   as   “services”
defined   under   Section   2(1)(o)   includes   banking,   insurance   and   if
there   is   deficiency   in   service   in   the   matter   of   banking/insurance,
etc., subject to the fact that he is a consumer under Section 2(1)(d),
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remedy   is   always   available   to   such   a   consumer   to   invoke   the
jurisdiction of the Act, 1986.   
29. This   Court   adverted   to   the   concept   of   “consumer”   as   defined
under the Act, analysing the definition in the context of the Act, in
Lucknow Development Authority v. M.K. Gupta 3
 held :
“ 3 ……It   is   in   two   parts.   The   first   deals   with   goods   and   the   other
with   services.   Both   parts   first   declare   the   meaning   of   goods   and
services by use of wide expressions. Their ambit is further enlarged
by use of inclusive clause. For instance, it is not only purchaser of
goods or hirer of services but even those who use the goods or who
are   beneficiaries   of   services   with   approval   of   the   person   who
purchased the goods or who hired services are included in it. The
legislature   has   taken   precaution   not   only   to   define   ‘complaint’,
‘complainant’, ‘consumer’ but even to mention in detail what would
amount to unfair trade practice by giving an elaborate definition in
clause   ( r )   and   even   to  define   ‘defect’  and   ‘deficiency’   by  clauses   ( f )
and  ( g )  for   which   a  consumer   can  approach   the   Commission.   The
Act   thus   aims   to   protect   the   economic   interest   of   a   consumer   as
understood   in   commercial   sense   as   a   purchaser   of   goods   and   in
the larger sense of user of services. The common characteristics of
goods   and   services   are   that   they   are   supplied   at   a   price   to   cover
the   costs   and   generate   profit   or   income   for   the   seller   of   goods   or
provider   of   services.   But   the  defect   in   one   and   deficiency   in  other
may   have   to  be   removed   and  compensated   differently.   The   former
is,   normally,   capable   of   being   replaced   and   repaired   whereas   the
other   may   be   required   to   be   compensated   by   award   of   the   just
equivalent of the value or damages for loss……”
30. Later, this Court in   Laxmi Engineering Works   (supra), while
dealing with the connotative expanse of the term “consumer” in the
unamended   form   and   the   explanation   added   to   the   expression
3  (1994) 1 SCC 243
18

“Consumer”   by   an   amendment,   ruled   that   such   explanation   is
clarificatory in nature and taking note of the explanation added by
the amendment Act, 1993 extensively examined the definition of the
term “consumer” as under:­  
“11.   Now   coming   back   to   the   definition   of   the   expression
‘consumer’   in   Section   2( d ),   a   consumer   means   insofar   as   is
relevant  for  the  purpose  of  this  appeal,  ( i ) a  person  who buys  any
goods for consideration; it is immaterial whether the consideration
is paid or promised, or partly paid and partly promised, or whether
the   payment   of   consideration   is   deferred;   ( ii )   a   person   who   uses
such  goods   with the  approval  of  the person  who  buys  such  goods
for consideration; ( iii ) but does not include a person who buys such
goods   for   resale   or   for   any   commercial   purpose.   The   expression
‘resale’   is   clear   enough.   Controversy   has,   however,   arisen   with
respect   to   meaning   of   the   expression   “commercial   purpose”.   It   is
also not defined in the Act. In the absence of a definition, we have
to go by its ordinary meaning. ‘Commercial’ denotes “pertaining to
commerce”   ( Chamber's   Twentieth   Century   Dictionary );   it   means
“connected with, or engaged in commerce; mercantile; having profit
as   the   main   aim”   ( Collins   English   Dictionary )   whereas   the   word
‘commerce’   means   “financial   transactions   especially   buying   and
selling   of   merchandise,   on   a   large   scale”   ( Concise   Oxford
Dictionary ). The National Commission appears to have been taking
a   consistent   view   that   where   a   person   purchases   goods   “with   a
view   to   using   such   goods   for   carrying   on   any   activity   on   a   large
scale for the purpose of earning profit” he will not be a ‘consumer’
within   the   meaning   of   Section   2( d )( i )   of   the   Act.   Broadly   affirming
the   said   view   and   more   particularly   with   a   view   to   obviate   any
confusion   ­   the   expression   “large   scale”   is   not   a   very   precise
expression   ­   Parliament   stepped   in   and   added   the   explanation   to
Section   2( d )( i )   by   Ordinance/   Amendment   Act,   1993.   The
explanation   excludes   certain   purposes   from   the   purview   of   the
expression   “commercial   purpose”   ­   a   case   of   exception   to   an
exception.   Let   us   elaborate:   a   person   who   buys   a   typewriter   or   a
car and uses them for his personal use is certainly a consumer but
a person who buys a typewriter or a car for typing others' work for
consideration or for plying the car as a taxi can be said to be using
the   typewriter/car   for   a   commercial   purpose.   The   explanation
19

however   clarifies   that   in   certain   situations,   purchase   of   goods   for
“commercial purpose” would not yet take the purchaser out of the
definition of expression ‘consumer’. If the commercial use is by the
purchaser   himself   for   the   purpose   of   earning   his   livelihood   by
means   of   self­employment,   such   purchaser   of   goods   is   yet   a
‘consumer’. In the illustration given above, if the purchaser himself
works on typewriter or plies the car as a taxi himself, he does not
cease to be a consumer. In other words, if the buyer of goods uses
them himself, i.e., by self­employment, for earning his livelihood, it
would   not   be   treated   as   a   “commercial   purpose”   and   he   does   not
cease   to   be   a   consumer   for   the   purposes   of   the   Act.   The
explanation reduces the question, what is a “commercial purpose”,
to a question of fact to be decided in the facts of each case. It is not
the   value   of   the  goods   that   matters   but   the   purpose   to   which   the
goods   bought   are   put   to.   The   several   words   employed   in   the
explanation,   viz.,   “uses   them   by   himself”,   “exclusively   for   the
purpose   of   earning   his   livelihood”   and   “by   means   of   self­
employment”   make   the   intention   of   Parliament   abundantly   clear,
that   the   goods   bought   must   be   used   by   the   buyer   himself,   by
employing   himself   for   earning   his   livelihood.   A   few   more
illustrations would serve to emphasise what we say. A person who
purchases   an   auto­rickshaw   to   ply   it   himself   on   hire   for   earning
his   livelihood   would   be   a   consumer.   Similarly,   a   purchaser   of   a
truck  who purchases  it  for plying  it as a  public  carrier  by  himself
would be a consumer. A person who purchases a lathe machine or
other machine to operate it himself for earning his livelihood would
be a consumer. (In the above illustrations, if such buyer takes the
assistance   of   one   or   two   persons   to   assist/help   him   in   operating
the vehicle or machinery, he does not cease to be a consumer.) As
against this a person who purchases an auto­rickshaw, a car or a
lathe machine or other machine to be plied or operated exclusively
by another person would not be a consumer. This is the necessary
limitation   flowing   from   the   expressions   “used   by   him”,   and   “by
means   of   self­employment”   in   the   explanation.   The   ambiguity   in
the meaning of the words “for the purpose of earning his livelihood”
is explained and clarified by the other two sets of words.
and   after   a   fair   analysis   of   the   definition   “consumer”
post­amendment 1993 finally held as under:
“21.   We must, therefore, hold that:
20

( i )   The   explanation   added   by   the   Consumer   Protection
(Amendment) Act 50 of 1993 (replacing Ordinance 24 of 1993) with
effect   from   18­6­1993   is   clarificatory   in   nature   and   applies   to   all
pending proceedings.
( ii ) Whether the purpose for which a person has bought goods is a
“commercial   purpose”   within   the   meaning   of   the   definition   of
expression   ‘consumer’   in   Section   2( d )   of   the   Act   is   always   a
question   of   fact   to   be   decided   in   the   facts   and   circumstances   of
each case.
( iii )   A   person   who   buys   goods   and   uses   them   himself,   exclusively
for   the   purpose   of   earning   his   livelihood,   by   means   of   self­
employment is within the definition of the expression ‘consumer’.”
31. The exposition of law on the subject was further considered by
this   Court   in   Lilavati   Kirtilal   Mehta   Medical   Trust   v.   Unique
Shanti   Developers   and   Others 4
  in   which   one   of   us   (Rastogi,   J.)
was   a   member   and   the   question   arose   for   consideration   was
whether   the   purchase   of   flats   for   the   purpose   of   providing
accommodation   to   nurses   employed   by   the   Lilavati   Kirtilal   Mehta
Medical   Trust   hospital   qualifies   a   purchase   of   services   for
commercial   purpose   and   whether   the   Hospital   Trust   was   excluded
from   the   definition   of   “consumer”   under   Section   2(1)(d)   of   the   Act,
1986,   this   Court   after   revisiting   the   scheme   of   the   Act,   1986   and
taking note of the law of precedence in  Laxmi Engineering Works
(supra) of which a reference has been made and placing reliance on
4  (2020) 2 SCC 265
21

the judgment of this Court in  Paramount Digital Colour Lab and
Others   v.   AGFA   India   Private   Limited   and   Others 5
  held   that   a
person   whether   or   not   a   consumer   or   other   activities   meant   for
commercial   purpose   will   always   depend   upon   the   facts   and
circumstances of each case.
32. It may be a case that a person who is engaged in commercial
activities has purchased goods or availed of service for his personal
use   or   consumption   or   for   the   personal   use   of   a   beneficiary   and
such   purchase   is   not   linked   to   their   ordinary   profits   generating
activities or for creation of self­employment, such a person may still
claim to be a consumer and after discussion of various illustrations
summarized the discussion after taking note of the broad principles
that   were   culled   out   for   determination   whether   the   activity   or
transaction is for a commercial purpose, held as under:
“19.   To   summarise   from   the   above   discussion,   though   a   strait
jacket   formula   cannot   be   adopted   in   every   case,   the   following
broad   principles   can   be   culled   out   for   determining   whether   an
activity or transaction is “for a commercial purpose”:
19.1.   The   question   of   whether   a   transaction   is   for   a   commercial
purpose   would   depend   upon   the   facts   and   circumstances   of   each
case.   However,   ordinarily ,   “commercial   purpose”   is   understood   to
include   manufacturing/industrial   activity   or   business­to­business
transactions between commercial entities.
5  (2018) 14 SCC 81
22

19.2.   The purchase of the good or service should have a close and
direct nexus with a profit­generating activity.
19.3.   The identity of the person making the purchase or the value
of the transaction is not conclusive to the question of whether it is
for a commercial purpose. It has to be seen whether the dominant
intention or dominant purpose for the transaction was to facilitate
some   kind   of   profit   generation   for   the   purchaser   and/or   their
beneficiary.
19.4.   If   it   is   found   that   the   dominant   purpose   behind   purchasing
the   good   or   service   was   for   the   personal   use   and   consumption   of
the   purchaser   and/or   their   beneficiary,   or   is   otherwise   not   linked
to   any   commercial   activity,   the   question   of   whether   such   a
purchase was for the purpose of “generating livelihood by means of
self­employment” need not be looked into.”
33. This   Court   noticed   that   the   hostel   facilities   were   provided   to
the   nurses   employed   by   Lilavati   hospital   but   after   some   time   of
completion   of   the   project   because   of   alleged   poor   building   quality,
the   structure   became   dilapidated   and   the   nursing   staff   had   to
vacate the flats being used by them and a consumer complaint filed
by the Lilavati hospital for compensation on account of annual loss
of   rent   was   maintainable   and   whether   the   Trust   was   a   consumer
under Section 2(1)(d) of the Act. 
34. In   Lilavati Kirtilal Mehta Medical Trust   (supra), this Court
observed   that   there   is   no   nexus   between   the   purchase   of   flats   by
the   appellant   Trust   and   its   profit   generating   activity   as   the   flats
were not occupied for undertaking any medical/diagnostic facilities
23

within the hospital, but for accommodating the nurses employed by
the hospital.   In the given circumstances, it has nothing to do with
earing   of   profits   in   providing   facilities   to   the   nurses   and   held   that
the Trust is a “consumer” under Section 2(1)(d) of the Act, 1986 for
the transaction under consideration.
35. Thus,   what   is   important   is   the   transaction   in   reference   to
which the claim has been filed under the Act, 1986 by a person who
claims himself to  be  a “consumer” covered  under  Section  2(1)(d) of
the   Act,   1986,   such   exposition   of   law   on   the   subject   has   been
further reiterated by this Court recently  in   Shrikant  G.  Mantri  v.
Punjab National Bank 6
  and after the analysis on  the subject and
taking   note   of   the   judgment   of   this   Court   in   Lilavati   Kirtilal
Mehta   Medical   Trust   (supra),   of   which   reference   has   been   made,
examined  the case on   the facts  in question   and recorded a  finding
that   the   transaction   in   question   would   fall   within   the   definition   of
the   term   “consumer”   or   “services”   for   the   purpose   of   invoking
jurisdiction under the Act, 1986.  
6  (2022) 5 SCC 42
24

36. Thus,   what   is   culled   out   is   that   there   is   no   such   exclusion
from   the   definition   of   the   term   “consumer”   either   to   a   commercial
enterprise   or   to   a   person   who   is   covered   under   the   expression
“person” defined in Section 2(1)(m) of the Act, 1986 merely because
it   is   a   commercial   enterprise.     To   the   contrary,   a   firm   whether
registered or not is a person who can always invoke the jurisdiction
of the Act, 1986 provided it falls within the scope and ambit of the
expression   “consumer”   as   defined   under   Section   2(1)(d)   of   the   Act,
1986.
37. Applying the above principles to the present case, what needs
to  be determined is whether  the insurance service has a close and
direct   nexus   with   the   profit   generating   activity   and   whether   the
dominant intention or dominant purpose for the transaction was to
facilitate   some   kind   of   profit   generation   for   the   purchaser   and/or
their   beneficiary.     The   fact   that   the   insured   is   a   commercial
enterprise   is   unrelated   to   the   determination   of   whether   the
insurance  policy   shall   be   counted   as   a   commercial   purpose   within
the purview of Section 2(1)(d) of the Act.  
25

38.  In the case of  Karnataka Power Transmission Corporation
and   Another   v.   Ashok   Iron   Works   Private   Limited 7
,   this   Court
while answering the question in the affirmative observed :
“17.   It   goes   without   saying   that   interpretation   of   a   word   or
expression must depend on the text and the context. The resort to
the word “includes” by the legislature often shows the intention of
the   legislature   that   it   wanted   to   give   extensive   and   enlarged
meaning to such expression. Sometimes, however, the context may
suggest   that   word   “includes”   may   have   been   designed   to   mean
“means”.   The   setting,   context   and   object   of   an   enactment   may
provide sufficient guidance for interpretation of the word “includes”
for the purposes of such enactment.
18.   Section 2(1)( m ) which enumerates four categories, namely,
( i ) a firm whether registered or not;
( ii ) a Hindu Undivided Family;
( iii ) a cooperative society; and
( iv )   every   other   association   of   persons   whether   registered
under the Societies Registration Act, 1860 (21 of 1860) or not
while   defining   “person”   cannot   be   held   to   be   restrictive   and
confined to these four categories as it is not said in terms that
“person”   shall   mean   one   or   other   of   the   things   which   are
enumerated, but that it shall “include” them.
19.   The   General   Clauses   Act,   1897   in   Section   3(42)   defines
“person”:
“3. (42) ‘person’ shall include any company  or association or body
of individuals, whether incorporated or not;”
20.   Section   3   of   the   1986   Act   upon   which   reliance   is   placed   by
learned   counsel   for   KPTC   provides   that   the   provisions   of   the   Act
are   in   addition   to   and   not   in   derogation   of   any   other   law   for   the
time   being   in   force.   This   provision   instead   of   helping   the
contention   of   KPTC   would   rather   suggest   that   the   access   to   the
remedy provided to ( sic   under) the Act of 1986 is an addition to the
provisions of any other law for the time being in force. It does not
in any way give any clue to restrict the definition of “person”.
7  (2009) 3 SCC 240
26

21.   Section   2(1)( m ),   is   beyond   all   questions   an   interpretation
clause, and must have been intended by the legislature to be taken
into account in construing the expression “person” as it occurs in
Section   2(1)( d ).   While   defining   “person”   in   Section   2(1)( m ),   the
legislature   never   intended   to   exclude   a   juristic   person   like
company.   As   a   matter   of   fact,   the   four   categories   by   way   of
enumeration mentioned therein is indicative, Categories ( i ), ( ii ) and
( iv ) being unincorporate and Category ( iii ) corporate, of its intention
to   include   body   corporate   as   well   as   body   unincorporate.   The
definition   of   “person”   in   Section   2(1)( m )   is   inclusive   and   not
exhaustive.   It   does   not   appear   to   us   to   admit   of   any   doubt   that
company   is   a   person   within   the   meaning   of   Section   2(1)( d )   read
with Section 2(1)( m ) and we hold accordingly.”
39. Applying   the   aforesaid   test,   two   things   are   culled   out;   (i)
whether   the   goods   are   purchased   for   resale   or   for   commercial
purpose; or (ii) whether the services are availed for any commercial
purpose.   The   two­fold   classification   is   commercial   purpose   and
non­commercial   purpose.   If   the   goods   are   purchased   for   resale   or
for   commercial   purpose,   then   such   consumer   would   be   excluded
from the coverage of the Act, 1986.  For example, if a manufacturer
who   is   producing   product   A,   for   such   production   he   may   be
required   to   purchase   articles   which   may   be   raw   material,   then
purchase   of   such   articles   would   be   for   commercial   purpose.       As
against   this,   if   the   same   manufacturer   purchases   a   refrigerator,
television or air­conditioner  for his use at his residence or even for
his   office   has   no   direct   or   indirect   nexus   to   generate   profits,   it
27

cannot   be   held   to   be   for   commercial   purpose   and   for   afore­stated
reason he is qualified to approach the Consumer Forum under the
Act, 1986.
40. Similarly,   a   hospital   which   hires   services   of   a   medical
practitioner,   it   would   be   a   commercial   purpose,   but   if   a   person
avails   such   services   for   his   ailment,   it   would   be   held   to   be   a   non­
commercial purpose.   Taking a wide meaning of the words “for any
commercial   purpose”,   it   would   mean   that   the   goods   purchased   or
services   hired   should   be   used   in   any   activity   directly   intended   to
generate profit.   Profit is the main aim  of commercial purpose, but
in   a   case   where   goods   purchased   or   services   hired   is   an   activity,
which  is   not   directly   intended   to   generate  profit,  it   would   not   be  a
commercial purpose.
41. In   other   words,   to   make   it   further   clear,   let   us   have   certain
illustrations,   as   to   whether   the   transaction   falls   for   commercial
purpose or whether the complainant can be held to be a “consumer”
within the scope and ambit of Act, 1986.  
28

(i) A CT scan machine was purchased by a Charitable Trust and
that   was   found   to   be   defective,   the   question   raised   whether   the
machinery   was   purchased   for   a   commercial   purpose   and   whether
the   appellant   was   a   consumer.   From   the   narration   of   facts,   this
Court in  Kalpavruksha Charitable Trust v. Toshniwal Brothers
(Bombay)   Pvt.   Ltd.   and   Another 8
  held   that   the   machine   was
purchased by the Charitable Trust for commercial purpose as every
person   who   takes   a   CT   scan   has   to   pay   for   it   and   the   services
rendered are not free and thus the Trust was not a consumer.  
(ii). In   Rajeev   Metal   Works   and   Others   v.   Mineral   &   Metal
Trading   Corporation   of   India   Ltd. 9
,   a   manufacturer   imported
raw material through statutory authority that acted as a canalizing
agency   for   manufacture   and   sale   of   the   finished   product.     The
appellant   approached   the   National   Commission   alleging   that   the
respondent   had   not   supplied   the   required   quantity   demanded   by
the   appellant.     This   Court   held   that   the   purchase   was   for   a
commercial   purpose   and   the   manufacturer   was   not   a   “consumer”
for the purpose of the Act, 1986.
8  (2000) 1 SCC 512
9  (1996) 9 SCC 422
29

(iii). The   bank   which   had   taken   bankers   indemnity   insurance
policy from the insurance company and suffered loss owing to some
of   transactions   in   one   of   its   branches,   raised   an   insurance   claim
stating   that   it   is   owing   to   dishonesty   of   Branch   Manager   and   the
claim   was   repudiated   by   the   insurance   company   stating   that   the
alleged loss was because of some dishonesty of the Branch Manager
and this being for commercial purpose, may not be a consumer.
(iv). The   complainant   is   a   private   limited   company   running   a
diagnostic   clinic   and   alleges   that   X­ray   machine   purchased   by   the
complainant from the opposite party was defective.   If an objection
is   raised   that   as   machine   was   purchased   for   commercial   purpose
and   the   complainant   cannot   be   said   to   be   a   consumer   as   defined
under   the   Act,   1986   as   he   has   been   employed   for   commercial
purpose   and   has   been   carrying   out   business   for   profit   indeed   the
complainant is not a consumer under the Act, 1986.
(v). A   company   purchased   the   EPBX   system   for   the   better
management   of   the   business   of   the   company   for   commercial
purpose   and   the   complaint   filed   for   alleged   supply   of   defective
system may not be covered by the explanatory clause of Section 2(1)
30

(d)   of   the   Act,   1986   as   the   transaction   has   no   nexus   to   generate
profits.  
42. Thus,   what   is   finally   culled   out   is   that   each   case   has   to   be
examined   on   its   own   facts   and   circumstances   and   what   is   to   be
examined   is   whether   any   activity   or   transaction   is   for   commercial
purpose   to   generate   profits   and   there   cannot   be   a   straight­jacket
formula   which   can   be   adopted   and  every   case  has   to   be   examined
on the broad principles which have been laid down by this Court, of
which detailed discussion has been made.
43. Applying the above principles in the present case, what needs
to be determined is whether  the insurance service had a close and
direct   nexus   with   the   profit   generating   activity   and   whether   the
dominant  intention  or  dominant  purpose of the transaction  was to
facilitate   some   kind   of   profit   generation   for   the   insured   or   to   the
beneficiary   and   our   answer   is   in   the   negative   and   accordingly   we
are   of   the   view   that   the   complaint   filed   by   the   respondent   insured
herein   has   no   close   or   direct   nexus   with   the   profit   generating
activity   and   the   claim   of   insurance   is   to   indemnify   the   loss   which
the   respondent   insured   had   suffered   and   the   Commission   has
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rightly held that the respondent is a “consumer” under Section 2(1)
(d) of the Act, 1986.   
44. We further reiterate that ordinarily the nature of the insurance
contract is always to indemnify the losses.   Insurance contracts are
contracts   of   indemnity   whereby   one   undertakes   to   indemnify
another   against   loss/damage   or   liability   arising   from   an   unknown
or   contingent   event   and   is   applicable   only   to   some   contingency   or
act likely to come in future.   
45. This   Court   in   United   India   Insurance   Company   Limited   v.
Levis Strauss (India) Private Limited 10
  has held as under:
“ 53 . A contract  of  insurance  is and always continues  to be one for
indemnity   of   the   defined   loss,   no   more   no   less.     In   the   case   of
specific  risks,  such  as  those   arising  from   loss  due  to fire,   etc.  the
insured   cannot   profit   and   take   advantage   by   double   insurance.
Long   ago,   Brett,   LJ   in   Castellain   v.   Preston   [ Castellain   v.   Preston,
(1883) 11 QBD 380] said that : (QBD p. 386)
“ ….. the contract of insurance … is a contract of indemnity.
…   and   that   this   contract   means   that   the   assured,   in   the
case of loss … shall be fully indemnified,   but shall never be
more than fully indemnified.””
(emphasis   added)
10  (2022) 6 SCC 1
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46. Thus,   it   can   be   concluded   that   in   the   instant   case   hiring   of
insurance   policy   is   clearly   an   act   for   indemnifying   a   risk   of
loss/damages and there is no element of profit generation and still
what has been expressed by this Court is illustrative; it will always
open to be examined on the facts of each case, as to the transaction
in  reference to  which  the claim  has been  raised has any  close and
direct nexus with profit generating activity.  
47. We   do   not   agree   with   the   submission   made   on   behalf   of   the
appellant that if insurance claims are covered under the Act, 1986,
then virtually all insurance matters will come within the purview of
the   Act, 1986  and  this  will  render  the  Act,  2015  nugatory.     In  our
view,   both   these   Acts   have   different   scope   and   ambit   and   have
different   remedial   mechanism,   are   in   different   sphere   having   no
internal co­relationship.
 48. Consequently,   the   appeals   are   without   substance   and
accordingly dismissed.  No costs.
49. Let the State Commission may adjudicate the complaint of the
respondents  on its own merits in accordance with  law and since it
33

is   an   old   matter,   be   decided   expeditiously   as   possible,   but   in   no
case later than one year.
50. Pending application(s), if any, shall stand disposed of.
CIVIL   APPEAL   NO(S).5354   OF   2007   –   (United   India   Insurance
Company Limited v. M/s Diwakar Goiram Porkhayat)
51. The present appeal is directed against the order passed by the
National   Commission   dated   3 rd
  December,   2004   holding   that   the
insurance   policy   taken   by   the   respondent   (commercial   unit)   in   the
facts   of   the   case   was   only   to   indemnity   the   loss   which   the
respondent/complainant   has   suffered   and   the   transaction   in
reference to which the insurance claim has been repudiated by the
appellant,   had   no   direct   nexus   with   the   profit   generating   activity
and   was   a   “consumer”   as   defined   under   Section   2(1)(d)   of   the   Act,
1986.   
52. The   respondent/complainant   (insured)   is   doing   the   business
of sale and purchase of jewellery in the name and style of “Khazana
Jewellers” who obtained a policy of insurance from the appellant for
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the period 21 st
 October, 1999 to 20 th
 October, 2000 to cover the risk
of ornaments in business.   
53. On 24 th
  June, 2000, at about 7.00 a.m. when an employee of
the   respondent   saw   that   the   shutter   of   the   showroom   was   partly
open   and   that   was   indicative   of   the   theft   and   upon   inspection,   it
was   found   that   goods   worth   Rs.20,55,200/­   were   stolen   from   the
showroom.   
54. On the claim being raised by the respondent to indemnify the
loss   suffered,   it   was   repudiated   by   the   appellant   and   that   was
challenged by the respondent by filing a consumer complaint before
the   State   Commission,   Ahmedabad,   that   was   dismissed   on   the
premise that the respondent was not a “consumer” within the ambit
of Section 2(1)(d) of the Act, 1986 by an order dated 1 st
 April, 2004.
55. The respondent challenged the order of dismissal by an appeal
before   the   National   Commission   taking   note   of   the   nature   of   the
transaction   and   relying   upon   the   order   of   the   Commission   in   the
case   of   M/s   Harsolia   Motors   dated   3 rd
  December,   2004,   the
Commission   held   that   the   transaction   in   reference   to   which   the
insurance   claim   has   been   raised   by   the   respondent   has   no   direct
35

nexus   with   the   profit   generating   activity   and   the   insurance   cover
was   obtained   only   to   cover   the   loss,   if   any,   being   suffered   on
account of theft or by natural calamity and the order passed by the
National   Commission   dated   3 rd
  December,   2004   is   the   subject
matter of challenge in appeal before us.
56. In the light of the judgment passed by us today in Civil Appeal
Nos.5352­5353   of   2007   (National   Insurance   Co.   Ltd.   v.   Harsolia
Motors and Others) , the present appeal is without substance and is
accordingly dismissed.   No costs.
57. The complaint is restored on the file of the State Commission
and the same be adjudicated on its own merits in accordance with
law and may be decided as expeditiously as possible, but in no case
later than one year.
58. Pending application(s), if any, shall stand disposed of.
CIVIL APPEAL NO(S).2821 OF 2012  – National Insurance Co. Ltd.
v. M/s Ankur and Another.
59. The   judgment   under   appeal   is   dated   15 th
  December,   2010
passed by the National Commission.  
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60. Brief   facts   of   the   case   are   that   the   respondent   is   engaged   in
the   business   of   garments   in   wholesale,   who   took   a   standard   fire
and peril policy effective for the period from 6 th
 January, 2006 to 5 th
January, 2007 for a total sum of Rs.60,00,000/­.   There was a fire
on   28 th
  December,   2006   resulting   in   damage   to   the   factory   of   the
respondent.       The   appellant   appointed   spot   surveyor,   M/s   Apex
Surveyors   Pvt.   Ltd.   for   final   survey,   who   submitted   its   report   on
22 nd
  December,   2008   assessing   the   loss   to   the   tune   of
Rs.53,17,790/­   after   deducting   salvage   amount   of   Rs.1   lakh   and
factoring sound stock being saved after the fire at Rs.51,969/­.  The
appellant   claimed  that  the   respondent   has  failed to   submit  certain
documents   to   the   assessor   and,   therefore,   assessment   on   such
basis   could   be   treated   as   void.     In   the   meanwhile,   SARFAESI
proceedings were initiated against the respondent by Canara Bank
(secured creditor).
61. While   the   claim   of   the   respondent   was   being   processed,   the
respondent filed a complaint before the State Commission claiming
Rs.60,00,000/­   along   with   interest.       At   this   stage,   the   appellant
filed   a   preliminary   objection   that   the   respondent   is   not   a
37

“consumer” within the definition of Section 2(1)(d) of the Act, 1986.
The State Commission at one stage had held that the respondent is
engaged   in   commercial   activity   and,   therefore,   is   not   a   consumer.
The finding returned by the State Commission was reversed by the
National   Commission   under   its   order   dated   15 th
  December,   2012
holding that commercial entity availing its services by the insurance
company is a “consumer” in reference to the transaction in terms of
Section 2(1)(d) of the Act, 1986. 
62. We  have  assigned  detailed  reasons  in   Civil  Appeal  Nos.(5352­
5353   of   2007   (National   Insurance   Co.   Ltd.   v.   Harsolia   Motors   and
Others) .       In   the   light   of   the   judgment   passed   by   us   today   in   the
said   appeal,   the   present   appeal   is   without   substance   and   is
accordingly dismissed.  No costs.
63. The complaint is restored on the file of the State Commission
and the same be adjudicated on its own merits in accordance with
law and may be decided as expeditiously as possible, but in no case
later than one year.
64. It   is   brought   to   our   notice   that   pursuant   to   order   dated   11 th
May,   2011   of   this   Court,   the   appellant   had   deposited   50%   of   the
38

claim   made   by   the   respondent   and   the   office   report   dated   15 th
February,   2023   indicates   that   an   amount   of   Rs.59,74,814/­   was
invested   in   the   fixed   deposit   with   the   maturity   date   of   16 th
  July,
2023.   Let the amount be transferred to the State Commission and
the   money   invested   in   fixed   deposit   shall   continue   and   may   be
invested in an interest­bearing account on automatic renewal basis
and the parties shall abide by the orders of the State Commission.  
65. Pending application(s), if any, shall stand disposed of.
CIVIL   APPEAL   NO(S).3350   OF   2018   –   The   Bank   of   New   York
Mellon   (Formerly   The   Bank   of   New   York)   v.   M/s   METCO   Export
International and Others.
66. The   appellant   has   filed   the   present   appeal   by   special   leave
against the judgment and order dated 6 th
 February, 2018 passed by
the National Commission. 
67. Brief facts of the case are that respondent no.1 entered into a
transaction with a third party (an Italian buyer of respondent no.1)
for supply of five containers of sesame seeds and oil seeds for USD
141,375.       In   relation   to   this   transaction,   the   services   of   Federal
Bank Ltd. (respondent no.2) were availed to send the invoice, bills of
39

lading,   surveyor’s   certificate,   bills   of   exchange,   phytosanitary
certificate   and   other   related   documents   (four   documents)   to   the
buyer’s   banker   in   Italy.     Respondent   no.2   engaged   the   services   of
the   appellant   to   get   export   documents   delivered   to   the   buyer’s
banker in Italy which in turn engaged services of a courier company
(respondent no.3).   The export documents were lost in transit.  
68. Respondent   no.1   filed   a   consumer   complaint   before   the   State
Commission against the appellant, respondent no.2 and respondent
no.3.  The complaint was dismissed on the premise that respondent
no.1 is not a consumer as defined under Section 2(1)(d) of the Act,
1986   by   an   order   dated   10 th
  December,   2013,   that   became   the
subject   matter   of   challenge   at   the   instance   of   respondent   no.1   in
appeal  before  the  National  Commission   relying  on  the  judgment   in
Laxmi   Engineering   Works   (supra)   and   taking   note   of   the
judgment   in   the   case   of   M/s   Harsolia   Motors ,   the   National
Commission   recorded   a   finding   that   the   dispatch   of   papers   by   the
bank   which   were   lost   in   transit   and   never   received   by   the   Italian
buyer   per se   is not related to generate any profit to the respondent
40

as   the   actual   profit   will   come   from   the   sale   of   the   exported   goods
which has no nexus to profit generating activity.  
69. After   we   have   heard   counsel   for   the   parties   and   considering
the  view expressed by  this  Court in   Civil Appeal Nos.5352­5353 of
2007   (National   Insurance   Co.   Ltd.   v.   Harsolia   Motors   and   Others) ,
the   present   appeal   is   without   substance   and   is   accordingly
dismissed.  No costs.
70. The complaint is restored on the file of the State Commission
and the same be adjudicated on its own merits in accordance with
law and may be decided as expeditiously as possible, but in no case
later than one year.
71. Pending application(s), if any, shall stand disposed of.
CIVIL APPEAL NO(S).         OF 2023
(@   SPECIAL   LEAVE   PETITION   (CIVIL)   NO(S).1039   OF   2020)   –
IFFCO   Tokio   General   Insurance   Company   Limited   v.   M/s   OPG
Energy (P) Ltd.
72. Leave granted. 
73. The   present   appeal   has   been   filed   by   special   leave   to   appeal
against the judgment and order dated 27 th
 September, 2019 passed
by the National Commission.
41

74. We   have  heard   counsel  for   the  parties  and   taking  note   of  the
fact initially an ex­parte order was passed by the Consumer Forum
against  the   appellant   on   12 th
  September,   2014,   pursuant   to   which
the appellant was directed to pay Rs.9,57,903/­ with interest @ 9%
per   annum   from   the   date   of   complaint   i.e.,   8 th
  April,   2011   and
Rs.5,000/­   towards   litigation.     The   appeal/revision   filed   at   the
instance of the appellant before the State Commission and National
Commission, both were dismissed by orders dated 25 th
  June, 2019
and 27 th
 September, 2019 respectively.  
75. After we have heard counsel for the parties, find no reason to
interfere   with   the   impugned   order   and   the   same   is   accordingly
dismissed.  No costs.
76. Pending application(s), if any, shall stand disposed of.
………………………J.
(AJAY RASTOGI)
       ……………………….J.
42

(C.T. RAVIKUMAR)
NEW DELHI;
APRIL 13, 2023.
43