NEENA ANEJA & Anr. v. JAI PRAKASH ASSOCIATES LTD

Judgment

96 A B C D E F G H SUPREME COURT REPORTS [2021] 15 S.C.R. 96 [2021] 15 S.C.R. NEENA ANEJA & ANR. v. JAI PRAKASH ASSOCIATES LTD. (Civil Appeal Nos. 3766-3767 of 2020) MARCH 16, 2021 [DR. DHANANJAYA Y CHANDRACHUD AND M. R. SHAH, JJ.] Consumer Protection Act, 2019 – s.107 –Consumer Protection Act, 1986 – Repeal of 1986 Act –Proceedings instituted thereunder, if can be continued under the same forum– Enhancement of pecuniary jurisdiction – Pending proceedings, if to be transferred –Consumer case was instituted by appellants before the NCDRC on 18.06.20 under the provisions of the 1986 Act–2019 Act came into force 20.07.20 – Case dismissed by NCDRC on the ground that after the enforcement of the 2019 Act, its pecuniary jurisdiction has been enhanced from rupees one crore to rupees ten crores and the claim of appellants, of Rs. 2.19 crores is below its enhanced pecuniary jurisdiction–Held: Proceedings instituted before the commencement of the 2019 Act would continue before the fora corresponding to those under the 1986 Act and not be transferred in terms of the pecuniary jurisdiction set for the fora established under the 2019 Act– Something specific in terms of statutory language either express words or words indicative of a necessary intendment would have been required for mandating the transfer of pending cases – Impugned order and the review order set aside – National Commission to continue hearing the case instituted by the appellants – General Clauses Act, 1897 – s.6 – Interpretation of Statutes – Harmonious construction. Consumer Protection Act, 2019 – s.107 –Object and purpose of the 2019 Act – Repeal of the Consumer Protection Act, 1986 – Proceedings pending thereunder, if to be transferred – Intention of legislature – Held: The legislature cannot be attributed to be remiss in not explicitly providing for transfer of pending cases according to the new pecuniary limits set up for the fora established by the new law, were that to be its intention–It would be difficult to attribute to Parliament, whose purpose in enacting the Act of 2019 was to 96 NEENA ANEJA & ANR. v. JAI PRAKASH ASSOCIATES LTD. protect and support consumers with an intent that would lead to financial hardship, uncertainty and expense in the conduct of consumer litigation – General Clauses Act, 1897 – s.6. Interpretation of Statutes – Procedural Law – Change of forum – Operation of, if retrospective – Held: A change in forum lies in the realm of procedure – Amendments on matters of procedure are retrospective, unless a contrary intention emerges from the statute – Repeals or amendments that effect changes in forum would ordinarily affect pending proceedings, unless a contrary intention appears from the repealing or amending statute – Position of law on change of forum, precedents analysed – Position of law clarified. General Clauses Act – s.6 (c), (e) – Consumer Protection Act, 1986 – Held: Plain consequence of clause (c) and clause (e), when read together is two-fold: first, the right which has accrued on the date of the institution of the consumer complaint under the Act of 1986 is preserved; and second, the enforcement of the right through the instrument of a legal proceeding or remedy will not be affected by the repeal. Words & Phrases – “entertain” – Consumer Protection Act, 2019 – Consumer Protection Act, 1986 – Held: Mere use of the word “entertain” in defining jurisdiction is not sufficient to counteract the overwhelming legislative intention to ensure consumer welfare and deliberately not provide for a provision for transfer of pending proceedings in the Act of 2019 or u/s.106 of the Act of 2019 which is a power to remove difficulties for a period of two years after the commencement of the Act of 2019. Allowing the appeals, the Court HELD: 1.1 A change in forum lies in the realm of procedure. Accordingly, in compliance with the tenets of statutory interpretation applicable to procedural law, amendments on matters of procedure are retrospective, unless a contrary intention emerges from the statute. However, there was a deviation by a two judge bench decision of this Court in Dhadi Sahu, which overlooked the decision of a larger three judge bench in New India Assurance and of a co-ordinate two judge bench in Maria Cristina. The decision in Dhadi Sahu propounded a position that “no litigant has any vested right in the matter of procedural 97 A B C D E F G H SUPREME COURT REPORTS [2021] 15 S.C.R. law but where the question is of change of forum it ceases to be a question of procedure only. The forum of appeal or proceedings is a vested right as opposed to pure procedure to be followed before a particular forum. The right becomes vested when the proceedings are initiated in the tribunal.”In taking this view, the two judge bench did not consider binding decisions. Dhadi Sahu failed to consider that the saving of pending proceedings in Mohd. Idris and Manujendra Dutt was a saving of vested rights of the litigants that were being impacted by the repealing acts therein, and not because a right to forum is accrued once proceedings have been initiated. Thereafter, a line of decisions followed Dhadi Sahu, to hold that a litigant has a crystallized right to a forum once proceedings have been initiated. A litigant’s vested right (including the right to an appeal) prior to the amendment or repeal are undoubtedly saved, in addition to substantive rights envisaged under Section 6 of the General Clauses Act. This protection does not extend to pure matters of procedure. Repeals or amendments that effect changes in forum would ordinarily affect pending proceedings, unless a contrary intention appears from the repealing or amending statute. [Para 53][158-H; 159-A-F] Commissioner of Income Tax, Orissa v. Dhadi Sahu 1994 Suppl. (1) SCC 257 : [1992] 3 Suppl. SCR 168– held per incuriam. Mohd. Idris v. Sat Narain AIR 1966 SC 1499 : [1966] SCR 15; Manujendra Dutt v. Purnedu Prosad Roy Chowdhury [1967] 1 SCR 475 – referred to.

1.2 Section 107(1) of the Act of 2019 repeals the Act of 1986. Section 107 (2) has saved “the previous operation” of any repealed enactment or “anything duly done or suffered thereunder to the extent that it is not inconsistent with the provisions of the new legislation”. Finally, Section 107(3) indicates that the mention of particular matters in sub-Section (2) will not prejudice or affect the general application of Section 6 of the General Clauses Act. Section 6 of the General Clauses Act provides governing principles with regard to the impact of the repeal of a central statute or regulation. These governing principles are to apply, “unless a different intention appears”. Clause (c) of Section 6 98 A B C D E F G H NEENA ANEJA & ANR. v. JAI PRAKASH ASSOCIATES LTD. inter alia stipulates that a repeal would not affect “any right, privilege, obligation or liability acquired, accrued or incurred under any enactment so repealed”. The right to pursue a validly instituted consumer complaint under the Act of 1986 is a right which has accrued under the law which was repealed. Clause (e) of Section 6 stipulates that the repeal will not affect, inter alia, any “legal proceeding or remedy” in respect of any such right…as aforesaid”. Any such legal proceedings may be continued as if the repealing legislation had not been passed. Clause (c) of Section 6 has the effect of preserving the right which has accrued. Clause (e) ensures that a legal proceeding which has been initiated to protect or enforce “such right” will not be affected and that it can be continued as if the repealing legislation has not been enacted. The expression such a right in clause (e) evidently means the right which has been adverted to in clause (c). The plain consequence of clause (c) and clause (e), when read together is two-fold: first, the right which has accrued on the date of the institution of the consumer complaint under the Act of 1986 (the repealing law) is preserved; and second, the enforcement of the right through the instrument of a legal proceeding or remedy will not be affected by the repeal. This position needs to be harmonized with the principle that the right to a forum is not an accrued right. While Section 6(e) of the General Clauses Act protects the pending legal proceedings for the enforcement of an accrued right from the effect of a repeal, this does not mean that the legal proceedings at a particular forum are saved from the effects from the repeal. The question whether the pending legal proceedings are required to be transferred to the newly created forum by virtue of the repeal would still persist. This Court in New India Assurance and Maria Christina has held that forum is a matter pertaining to procedural law and therefore the litigant has to pursue the legal proceedings at the forum created by the repealing act, unless a contrary intention appears. This principle would also apply to pending proceedings, asobserved in Ramesh Kumar Soni, Hitendra Kumar Thakur and Sudhir G Angur. In this backdrop, what is relevant to ascertain is whether a contrary intent to the general rule of retrospectivity has been expressed under the Act of 2019 to continue the proceedings at the older forum. [Paras 62-64][161-F, G-H; 162-A-H, 163-A-B] 99 A B C D E F G H 100 SUPREME COURT REPORTS [2021] 15 S.C.R. Hitendra Vishnu Thakur v. State of Maharashtra (1994) 4 SCC 602 : [1994] 1 Suppl. SCR 360; Sudhir G Angur v. M Sanjeev (2006) 1 SCC 141 : [2005] 4 Suppl. SCR 851; Ramesh Kumar Soni v. State of Maharashtra (2013) 14 SCC 696 : [2013] 1 SCR 1129 – relied on.

1.3 In considering the expression of intent in the repealing enactment in the present case, it is apparent that there is no express language indicating that all pending cases would stand transferred to the fora created by the Act of 2019 by applying its newly prescribed pecuniary limits. In deducing whether there is a contrary intent, the legislative scheme and procedural history may provide a relevant insight into the intention of the legislature. The Act of 2019, as indicated by its long title, is enacted to provide “for protection of the interests of consumers”. The Statement of Objects and Reasons took note of the tardy disposal of cases under the erstwhile legislation. Thus, the necessity of inducing speed in disposal was to protect the rights and interests of consumers. The Act of 2019 has taken note of the evolution of consumer markets by the proliferation of products and services in light of global supply chains, e-commerce and international trade. New markets have provided a wider range of access to consumers. But at the same time, consumers are vulnerable to exploitation through unfair and unethical business practices. The Act has sought to address “the myriad and constantly emerging vulnerabilities of the consumers”. The recurring theme in the new legislation is the protection of consumers which is sought to be strengthened by procedural interventions such as strengthening class actions and introducing mediation as an alternate forum of dispute resolution. [Paras 65, 66][163-B-F]

1.4 Something specific in terms of statutory language - either express words or words indicative of a necessary intendment would have been required for mandating the transfer of pending cases. One can imagine the serious hardship that would be caused to the consumers, if cases which have been already instituted before the NCDRC were required to be transferred to the SCDRCs as a result of the alteration of pecuniary limits by the Act of 2019. A consumer who has engaged legal counsel at the A B C D E F G H NEENA ANEJA & ANR. v. JAI PRAKASH ASSOCIATES LTD. 101 headquarters of the NCDRC would have to undertake a fresh round of legal representation before the SCDRC incurring expense and engendering uncertainty in obtaining access to justice. Likewise, where complaints have been instituted before the SCDRC, a transfer of proceedings would require consumers to obtain legal representation before the District Commission if cases were to be transferred. Such a course of action would have a detrimental impact on the rights of consumers. Many consumers may not have the wherewithal or the resources to undertake a fresh burden of finding legal counsel to represent them in the new forum to which their cases would stand transferred. 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. Ironically, the objection which has been raised in the present case to the continued exercise of jurisdiction by the NCDRC in regard to the consumer complaint filed by the appellant is by the developer who is the respondent herein. It is a developer who opposed the continuation of the proceedings before the NCDRC on the ground that under the new consumer legislation the pecuniary limits of the jurisdiction exercisable by the NCDRC have been enhanced and the complaint filed by the appellant which was validly instituted under the erstwhile law should be transferred to the SCDRC. Such a course of action will result in thousands of cases being transferred across the country, from the NCDRC to the SCDRCs and from the SCDRCs to the District Commission. [Paras 67, 68][163-G-H; 164-A-E]

1.5 The data indicates that as on 31 October 2019, 21,216 cases were pending before the NCDRC and 1,25,156 cases were pending before the SCDRC. Many of these cases would have to be transferred if the view which the developer propounds is upheld. This will seriously dislocate the interests of consumers in a manner which defeats the object of the legislation, which is to protect and promote their welfare. Clear words indicative of either an express intent or an intent by necessary implication would be necessary to achieve this result. The Act of 2019 contains no such indication. The transitional provisions contained in Sections 31, 45 and 56 expressly indicate that the adjudicatory A B C D E F G H 102 SUPREME COURT REPORTS [2021] 15 S.C.R. personnel who were functioning as Members of the District Commission, SCDRC and NCDRC under the erstwhile legislation shall continue to hold office under the new legislation. Such provisions are necessary because persons appointed to the consumer fora under the Act of 1986 would have otherwise demitted office on the repeal of the legislation. The legislature cannot be attributed to be remiss in not explicitly providing for transfer of pending cases according to the new pecuniary limits set up for the fora established by the new law, were that to be its intention. The omission, when contextualized against the statutory scheme, portends a contrary intention to protect pending proceedings through Section 107(2) of the Act of 2019. This intention appears likely, particularly in light of previous decisions of the NCDRC which had interpreted amendments that enhanced pecuniary jurisdiction, with prospective effect. [Para 69][166-C- G] Southfield Paints and Chemicals Pvt. Ltd. v. New India Assurance Co. Ltd. Consumer Case No.286 of 2000 (NCDRC); Premier Automobiles Ltd. v. Dr. Manoj Ram achandran, Revision Petitions Nos. 400 to 402 of 1993 (NCDRC) – approved.

1.6 It is accepted, that in defining the jurisdiction of the District Commission, Section 34 of the Act of 2019 entrusts the jurisdiction to “entertain” complaints. A similar provision is contained in Section 47 and Section 58 in regard to the SCDRC and NCDRC. Sections 34, 47 and 58 similarly indicate that the respective consumer fora can entertain complaints within the pecuniary limits of their jurisdiction. These provisions will undoubtedly apply to complaints which were instituted after the Act of 2019 came into force. However, the mere use of the word “entertain” in defining jurisdiction is not sufficient to counteract the overwhelming legislative intention to ensure consumer welfare and deliberately not provide for a provision for transfer of pending proceedings in the Act of 2019 or under Section 106 of the Act of 2019 which is a power to remove difficulties for a period of two years after the commencement of the Act of 2019. [Para 70][167- C, F-G] A B C D E F G H NEENA ANEJA & ANR. v. JAI PRAKASH ASSOCIATES LTD. 103

1.7 Proceedings instituted before the commencement of the Act of 2019 on 20 July 2020 would continue before the fora corresponding to those under the Act of 1986 (the National Commission, State Commissions and District Commissions) and not be transferred in terms of the pecuniary jurisdiction set for the fora established under the Act of 2019. Directions- (i) The impugned judgment and order of the NCDRC dated 30 July 2020 and the review order dated 5 October 2020, directing a previously instituted consumer case under the Act of 1986 to be filed before the appropriate forum in terms of the pecuniary limits set under the Act of 2019, shall stand set aside; (ii) The National Commission shall continue hearing the consumer case instituted by the appellants; (iii) All proceedings instituted before 20 July 2020 under the Act of 1986 shall continue to be heard by the fora corresponding to those designated under the Act of 1986 as explained above and not be transferred in terms of the new pecuniary limits established under the Act of 2019. [Para 71][168- A-E]