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Consumer complaint not maintainable after settlement: National Consumer Commission

“If the parties have gone into an arbitration and the arbitration award has been passed, the doors of the consumer forum are not open for the same relief”

mumbai Updated: May 23, 2018 00:09 IST
Kanchan Chaudhari
Kanchan Chaudhari
Hindustan Times
Mumbai,Consumer forum
A person cannot pursue two remedies finally one after the other because the first order shall operate as res judicata, the commission said.(HT PHOTO)

A person cannot approach consumer forum, if he has availed the remedy of arbitration with respect to the same relief, the National Consumer Disputes Redressal Commission has held last week.

“If the parties have gone into an arbitration and the arbitration award has been passed, the doors of the consumer forum are not open for the same relief,” said Prem Narain, presiding member of the National Consumer Commissioner while dismissing a complaint filed by Kolhapur resident Kalpana Sanghavi.

Sanghavi had approached a district consumer forum complaining that Dangi Financial and Management Consultants and Bhupali Securities had failed to deliver the shares purchased by her for quite some time and instead they simply refunded the amount that she sought to invest in the shares, without any returns that she would have got had the amount been invested in the shares in time.

Acting on her complaint, in January 2001, the district forum directed the opponents to pay her a sum of ₹45,000 with interest at the rate of 18% per annum and additional amount of ₹6,000 towards compensation and litigation cost. Dangi Financial and Management Consultants approached the National Consumer Commission after its appeal was dismissed by the Maharashtra State Consumer Commission.

Before the National Commissioner, advocate Anand Patwardhan argued on behalf of the investment consultant that, the complainant had availed remedy of arbitration under provisions of the Arbitration and Conciliation Act, 1996, and therefore the complaint was barred by principles of res judicata – which prohibits fresh adjudication of a matter already adjudicated by a competent court.

The National Commission accepted the argument and struck down the district forum’s order. “Clearly in the present case, arbitration order has been passed on 25/04/2000 and the claim of the complainant was rejected on the ground of limitation,” it said, holding the consumer complaint was not maintainable.

“It is true that Section 3 of the Consumer Protection Act, 1986 provides for additional remedy, but a person cannot pursue two remedies finally one after the other because the first order shall operate as res judicata for filing of the second application,” it said.

Section 3 lays down that provisions of the Consumer Protection Act, 1986, shall be in addition to and not in derogation of the provisions of any other law for the time being in force.

Besides, the National Commission also took into consideration that the matter was amicably settled and certain amount had already been paid to the complainant.

First Published: May 23, 2018 00:09 IST