Consumer Law

Consumer Forums are not Courts but are quasi-judicial bodies or authorities or agencies

National Commission is not a Court. (See Laxmi Engineering Works v. P.S.G. Industrial Institute, (1995) 3 SCC 583; Charan Singh v. Healing Touch Hospital, (2000) 7 SCC 668; State of Karnataka v. Vishwabharathi House Building Coop. Society, (2003) 2 SCC 412. This position has been fortified recently by a decision of a Constitution Bench of this Court in the case of Union of India v. R. Gandhi, President, Madras Bar Association (2010) 11 SCC 1, where this Court has observed:

38. The term “courts” refers to places where justice is administered or refers to Judges who exercise judicial functions. Courts are established by the State for administration of justice that is for exercise of the judicial power of the State to maintain and uphold the rights, to punish wrongs and to adjudicate upon disputes. Tribunals on the other hand are special alternative institutional mechanisms, usually brought into existence by or under a statute to decide disputes arising with reference to that particular statute, or to determine controversies arising out of any administrative law. Courts refer to civil courts, criminal courts and the High Courts. Tribunals can be either private tribunals (Arbitral Tribunals), or tribunals constituted under the Constitution (Speaker or the Chairman acting under Para 6(1) of the Tenth Schedule) or tribunals authorised by the Constitution (Administrative Tribunals under Article 323A and tribunals for other matters under Article 323B or statutory tribunals which are created under a statute (Motor Accidents Claims Tribunal, Debt Recovery Tribunals and consumer Fora). Some Tribunals are manned exclusively by Judicial Officers (Rent Tribunals, Motor Accidents Claims Tribunal, Labour Courts and Industrial Tribunals). Other statutory tribunals have judicial and technical members (Administrative Tribunals, TDSAT, Competition Appellate Tribunal, consumer Fora, Cyber Appellate Tribunal, etc.)

45. Though both courts and tribunals exercise judicial power and discharge similar functions, there are certain well-recognised differences between courts and tribunals. They are:

(i) Courts are established by the State and are entrusted with the State’s inherent judicial power for administration of justice in general. Tribunals are established under a statute to adjudicate upon disputes arising under the said statute, or disputes of a specified nature. Therefore, all courts are tribunals. But all tribunals are not courts.

(ii) Courts are exclusively manned by Judges.

Tribunals can have a Judge as the sole member, or can have a combination of a judicial member and a technical member who is an “expert” in the field to which the tribunal relates. Some highly specialised fact-finding tribunals may have only technical members, but they are rare and are exceptions.

(iii) While courts are governed by detailed statutory procedural rules, in particular the Code of Civil Procedure and the Evidence Act, requiring an elaborate procedure in decision making, tribunals generally regulate their own procedure applying the provisions of the Code of Civil Procedure only where it is required, and without being restricted by the strict rules of the Evidence Act.

35. In the case of Bharat Bank Ltd. v. Employees, (1950) SCR 459, this Court took the view that to be a court, the person or persons who constitute it, must be entrusted with judicial functions, that is, of deciding litigated questions according to law. This Court further observed that before a person or persons can be said to constitute a court, it must be held that they derive their powers from the State and are exercising the judicial powers of the State. In State of Bombay v. Narottamdas Jethabhai, (1951) SCR 51, this Court held that the word “Court” denoted a place where justice was judicially administered, having been vested the jurisdiction for this purpose by the State. In the case of Brajnandan Sinha v. Jyoti Narain, (1955) 2 SCR 955, it was held that in order to constitute a “Court” in the strict sense of the term, an essential condition is that the Court should have, apart from having some trappings of a judicial tribunal, power to give decision or a definitive judgment which has finality and authoritativeness which are the essential tests of a judicial pronouncement. This Court, in Ram Narain v. The Simla Banking and Industrial Company Ltd., AIR 1956 SC 614, held that a Tribunal which exercised jurisdiction for 35 executing a decree would be a “court” for the purpose of the Banking Companies Act.

36. While examining the Contempt of Courts Act, 1971, a Constitution Bench of this Court in Baradakanta Mishra v. Registrar of Orissa High Court, (1974) 1 SCC 374, observed:

68. What then is a court? It is

an agency of the sovereign created by it directly or indirectly under its authority, consisting of one or more officers, established and maintained for the purposes of hearing and determining issues of law and fact regarding legal rights and alleged violations thereof, and of applying the sanctions of the law, authorised to exercise its powers in due course of law at times and places previously determined by lawful authority.” Isbill v. Stovall, Rex. Civ. App. 92 SW 2d 1057 1070.

37. In State of Tamil Nadu v. G.N. Venkataswamy, (1994) 5 SCC 314, this Court observed that the primary function of a Court was to adjudicate disputes, while holding that a Collector constitutes a Revenue Court within the meaning of Entry 11-A of the List III of the Seventh Schedule of the Constitution. In Canara Bank v. Nuclear Power Corpn. of India, (1995) 3 Suppl. SCC 81, this Court observed:

26. In our view, the word ‘court’ must be read in the context in which it is used in a statute. It is permissible, given the context, to read it as comprehending the courts of civil judicature and courts or some tribunals exercising curial, or judicial powers…

This Court also quoted, with approval, the Halsbury’s Laws of England and observed thus:

29. In Halsbury’s Laws of England (4th Edn., Vol. 10, paras 701 and 702), this is observed:

701. Meaning of ‘court’. Originally the term ‘court’ meant, among other things, the Sovereign’s palace. It has acquired the meaning of the place where justice is administered and, further, has come to mean the persons who exercise judicial functions under authority derived either directly or indirectly from the Sovereign. All tribunals, however, are not courts, in the sense in which the term is here employed. Courts are tribunals which exercise jurisdiction over persons by reason of the sanction of the law, and not merely by reason of voluntary submission to their jurisdiction.Thus, arbitrators, committees of clubs and the like, although they may be tribunals exercising judicial functions, are not ‘courts’ in this sense of that term. On the other hand, a tribunal may be a court in the strict sense of the term even though the chief part of its duties is not judicial. Parliament is a court. Its duties are mainly deliberative and legislative; the judicial duties are only part of its functions. A coroner’s court is a true court although its essential function is investigation.

702. What is a court in law. The question is whether the tribunal is a court, not whether it is a court of justice, for there are courts which are not courts of justice. In determining whether a tribunal is a judicial body the facts that it has been appointed by a non-judicial authority, that it has No. power to administer an oath, that the chairman has a casting vote, and that third parties have power to intervene are immaterial, especially if the statute setting it up prescribes a penalty for making false statements; elements to be considered are (1) the requirement for a public hearing, subject to a power to exclude the public in a proper case, and (2) a provision that a member of the tribunal shall not take part in any decision in which he is personally interested, or unless he has been present throughout the proceedings.

A tribunal is not necessarily a court in the strict sense of exercising judicial power merely because (1) it gives a final decision; (2) it hears witnesses on oath; (3) two or more contending parties appear before it between whom it has to decide; (4) it gives decisions which affect the rights of subjects; (5) there is an appeal to a court; and (6) it is a body to which a matter is referred by another body.

Many bodies are not courts even though they have to decide questions, and in so doing have to act judicially, in the sense that the proceedings must be conducted with fairness and impartiality. Examples are the benchers of the Inns of Court when considering the conduct of one of their members, the disciplinary committee of the General Medical Council when considering questions affecting the conduct of a medical man, a trade union when exercising disciplinary jurisdiction over its members….”

30. These passages, from the earlier edition of Halsbury, were cited by this Court in Thakur Jugal Kishore Sinha v. Sitamarhi Central Coop. Bank Ltd. The question there was whether the provisions of the Contempt of Courts Act applied to a Registrar exercising powers under Section 48 of the Bihar and Orissa Cooperative Societies Act. It was held that the jurisdiction of the ordinary civil and revenue courts of the land was ousted in the case of disputes that fell under Section 48. A Registrar exercising powers under Section 48, therefore, discharged the duties which would otherwise have fallen on the ordinary civil and revenue courts. He had not merely the trappings of a court but in many respects he was given the same powers as were given to the ordinary civil courts of the land by the Code of Civil Procedure, including the power to summon and examine witnesses on oath, the power to order inspection of documents, to hear the parties after framing issues, to review his own order and to exercise the inherent jurisdiction of courts mentioned in Section 151. In adjudicating a dispute under Section 48 of the Bihar Act, the Registrar was held to be “to all intents and purposes a court discharging the same functions and duties in the same manner as a court of law is expected to do.

38. The aforesaid observation has been strongly relied upon by Shri. Jaideep Gupta in reply to the contention of Shri. Bhagat that the National Commission was not a Court, and therefore, lacked jurisdiction to decide the complaint filed by the opposite party. In P. Sarathy v. State Bank of India, (2000) 5 SCC 355, this Court took the view that the term “Court” in Section 14 of the Limitation Act, 1963, meant any authority or tribunal having the trappings of a court. It may also be relevant to notice that a Constitution Bench of this Court in the case of Kihoto Hollohon v. Zachillhu (1992) 2 Suppl. SCC 651 held that all Tribunals may not be Courts, but all Courts are Tribunals.

39. Now let us look at the definition of the term “Court” as commonly understood. The Oxford Advanced Learner’s Dictionary (8th Edition) defines it as “the place where legal trials take place and where crimes, etc. are judged.” The Oxford Thesaurus of English (3rd Ed) gives the following synonyms: “court of law, law court, bench, bar, court of justice, judicature, tribunal, forum, chancery, assizes, courtroom”. The Chamber’s Dictionary (10th Ed.) has described a court as “a body of person assembled to decide causes”. In Stroud’s Judicial Dictionary (5th Ed), the word “court” has been described as “a place where justice is judicially ministered, and is derived”, and is further observed, “but such a matter involves a judicial act which may be brought up on certiorari”.

40. The above dictionary meaning and decision of this Court in the case of Canara Bank (Supra.) and also the observations of the Constitution Bench decision of this Court in the case of R. Gandhi (Supra.) reveal that word “Court” must be understood in the context of a body that is constituted in order to settle disputes and decide rights and liabilities of the parties before it. “Courts” are those bodies that bring about resolutions to disputes between persons. As already mentioned, this Court has held that the Tribunal and Commissions do not fall under the definition of “Court”. However, in some situations, the word “Court” may be used in a wide, generic sense and not in a narrow and pedantic sense, and must, in those cases, be interpreted thus.

41. In State of Karnataka v. Vishwabharathi House Building Coop. Society, (2003) 2 SCC 412, this Court took the view that there is a legal fiction created in giving tribunals like the consumer Forum the powers of a Court. It was held:

57. A bare perusal of Section 25 of the Act clearly shows that thereby a legal fiction has been created to the effect that an order made by District Forum/State Commission or National Commission will be deemed to be a decree or order made by a civil court in a suit. Legal fiction so created has a specific purpose i.e. for the purpose of execution of the order passed by the Forum or Commission. Only in the event the Forum/State Commission or the National Commission is unable to execute its order, the same may be sent to the civil court for its execution. The High Court, therefore was not correct to hold that in each and every case the order passed by the District Forum/State Commission/National Commission are required to be sent to the civil courts for execution thereof.

58. Furthermore, Section 27 of the Act also confers an additional power upon the Forum and the Commission to execute its order. The said provision is akin to Order 39 Rule 2-A of the Code of Civil Procedure or the provisions of the Contempt of Courts Act or Section 51 read with Order 21 Rule 37 of the Code of Civil Procedure. Section 25 should be read in conjunction with Section 27. A parliamentary statute indisputably can create a tribunal and might say that non-compliance with its order would be punishable by way of imprisonment or fine, which can be in addition to any other mode of recovery.

42. The use of the word “Court” in Rule 29 of the Second Schedule of the CA Act has been borrowed from the Warsaw Convention. We are of the view that the word “Court” has not been used in the strict sense in the Convention as has come to be in our procedural law. The word “Court” has been employed to mean a body that adjudicates a dispute arising under the provisions of the CP Act. The CP Act gives the District Forums, State Forums and National Commission the power to decide disputes of consumers. The jurisdiction, the power and procedure of these Forums are all clearly enumerated by the CP Act. Though, these Forums decide matters after following a summary procedure, their main function is still to decide disputes, which is the main function and purpose of a Court. We are of the view that for the purpose of the CA Act and the Warsaw Convention, the consumer Forums can fall within the meaning of the expression “Court”.

Source:  JT 2011 (10) SC 624 : (2011) 10 SCALE 524

(SUPREME COURT OF INDIA) Trans Mediterranean Airways Versus Universal Exports and Another , Civil Appeal No. 1909 of 2004 : Decided On: 15-09-2011

[ The Honble Apex Court adopted a contradictory view in this article ]


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