Legal Brief: Consumer Commissions has power to act as Judicial Magistrate for trial of offences, which includes power to issue arrest warrants.
Case: Rakesh Khanna v. Naveen Kumar Aggarwal and ors.
Court: Delhi High Court
Date of Judgment: 25.09.2024
By: Adv. Saksham Mathur
Facts
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Naveen Kumar Aggarwal (respondent) filed a complaint against VXL Realtors Pvt. Ltd. under section 17 of the Consumer Protection Act, 1986, alleging deficiency of services and unfair trade practices.
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The State Consumer Disputes Redressal Commission (“SCDRC”) ruled in favour of the respondent and ordered the Company to refund the amount paid, along with interest, compensation, and litigation costs.
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The respondent initiated the execution proceedings to enforce the SCDRC order.
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Rakesh Khanna (“Petitioner”) was appointed as a director of the Company in 2020. arrest warrants were issued against the Petitioner, in his capacity as director, for the Company’s failure to comply with the SCDRC order dated 19.03.2024.
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The Petitioner challenged the arrest warrants before the National Consumer Disputes Redressal Commission (“NCDRC”), but the appeal was dismissed.
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The Petitioner filed a writ petition before the High Court of Delhi seeking to quash the NCDRC order.
Issue
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Whether the issuance of arrest warrants against the Petitioner, who became a director after the alleged acts of deficiency occurred, is lawful and justified under the provisions of the Consumer Protection Act?
Legal Analysis
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Responsibility for Compliance: The Petitioner argued that he shouldn’t be held liable as he wasn’t a director when the alleged deficiencies occurred. However, the Court emphasized that the issue wasn’t about personal liability for past actions, but about ensuring compliance with the SCDRC order.
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Director’s Obligation: As a director at the time of enforcement proceedings, the Petitioner had a legal obligation to ensure the Company complied with the SCDRC’s directives.
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Section 72 of the Consumer Protection Act: The Court relied upon Section 72 of the Consumer Protection Act, which empowers Consumer Commissions to penalize non-compliance with their orders, including issuing arrest warrants.
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Distinction from Negotiable Instruments Act: The Petitioner’s reliance on the Ashoke Mal Bafna V. Upper India Steel Manufacturing and Engineering Company Limited, which dealt with Section 141 of the Negotiable Instruments Act, was deemed misplaced. The Court clarified that the NI Act’s liability provisions, unlike those in the Consumer Protection Act, are tied to the time of the offense.
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Director’s Medical Condition: The Petitioner’s claim that his medical condition prevented him from managing the Company was rejected. The Court by relying upon Rajnish Kumar Rohatgi V. Unitech Limited, emphasized that the offense of non-compliance began when the SCDRC order was issued and continued until compliance was achieved.
•Applicability of the Civil Procedure Code: The Petitioner’s argument that the arrest warrants were issued under incorrect provisions of the CPC was dismissed. The Court held that the SCDRC’s authority stemmed from Sections 71 and 72 of the Consumer Protection Act, which empowers them to enforce orders and penalize non-compliance, including issuing arrest warrants.
Conclusion
The High Court of Delhi dismissed the writ petition, upholding the legality and validity of the arrest warrants. The Court held that the Petitioner, as a director during the enforcement proceedings, was responsible for ensuring the Company’s compliance with the SCDRC order, regardless of when the alleged deficiencies occurred. The Court emphasized the Consumer Commissions’ power under the Consumer Protection Act to enforce orders and penalise non-compliance, including issuing arrest warrants.