Consumer Issues
Consumer forum penalises wedding hall owner in Vashi

Besides the refund of Rs50,000, the consumer forum also directed the owner of Imperial Banquet Hall in Vashi to pay a fine of Rs10,000 to the complainant and also legal expenses of Rs2,000

Thane: Thane District Consumer Disputes Redressal Forum has directed owner of a wedding hall in Vashi in Navi Mumbai to refund Rs50,000 to a man, who had to cancel the venue, which he had booked for his daughter's marriage reception ceremony in 2009, reports PTI.


Besides the refund, the forum also directed the owner of the hall to pay a fine of Rs10,000 to the complainant and also legal expenses of Rs2,000. All the payment has to be done within 45 days, it said.


The complainants, Narendra Kalra and his daughter Harsha Kalra, in their complaint stated that they had made an advance payment of Rs50,000 on 22 April 2009 to Kambala Hospitality Pvt Ltd that runs Imperial Banquet Hall in Vashi.


However, the complainant, who is a tax consultant, told the court that the marriage could not materialise due to some reasons and the reception function had to be cancelled, about which he had informed to the hall owners "well in advance".


Kalra alleged that despite his repeated calls, the hall owner did not respond and when finally he did, the latter told the Kalras that the amount would be adjusted against the booking made by any of the complainant's acquaintances in future.


In 2010, when one of Kalra's friends booked the hall, the owner initially agreed to adjust the amount. However, just a day before the ceremony, he backed off and demanded money saying their advance would not be adjusted. Following this, Kalra approached the forum.


In its order, the forum observed that the owner of the hall should have cooperated and refunded the money to the complainants. The forum expressed a view that he should have explained the conditions and also got them printed in the form of a booklet.


"By confiscating the advance amount and misleading the consumer, the respondent has violated section 2(1)(4) of Consumer Protection Act 1986," the forum said.


HC refuses to quash allotment of a plot in Nashik to Mahindra & Mahindra

The order is considered significant against the backdrop of a MoU signed by Maharashtra government and Mahindra & Mahindra for commissioning of Rs700 crore project at Nashik for manufacture of 'Logan' car

Mumbai: The Bombay High Court has dismissed a petition filed by a company Zenith Metaplast Pvt Ltd praying for allotment of a three acre plot in Nashik to itself and cancellation of adjacent plots allotted to Mahindra & Mahindra Ltd and an industrialist, reports PTI.


The court observed that the Maharashtra government and the Maharashtra Industrial Development Corporation (MIDC) had acted in the interests of the state while allotting the adjacent plots admeasuring 17 acres and six acres to Mahindra & Mahindra and Nashik-based industrialist Abhay Kulkarni, respectively.


Zenith Metaplast also sought a writ of certiorari to quash the communications dated 16th December 2005 and 22nd June 2006, rejecting its application for the allotment of a plot admeasuring about 3 acres in the same MIDC area.


The order is considered significant against the backdrop of a MoU signed by Maharashtra government and Mahindra & Mahindra on 15 June 2005, in respect of commissioning of Rs700 crore project at Nashik for manufacture of "Logan" car.


"Having been through the records, we are satisfied that there is no arbitrariness in the decision. The decision to allot the said plots to Mahindra & Mahindra and Abhay Kulkarni was taken after due consideration of all the facts and circumstances of the case," observed Justices RY Ganoo and SJ Vajifdar in their recent order.


"MIDC and the state of Maharashtra considered the application of Mahindra & Mahindra and Abhay Kulkarni to be, inter-alia, in public interest for the benefit of the state. We find no reason to condemn this decision as arbitrary for any reason whatsoever," the judges observed.


The MIDC contended that the petitioner, over the years, had been allotted eight plots of land in the said area, but the full potential of even these plots was not exploited by the petitioner and therefore it has no case.


"The details of these eight plots and the extent to which they have been exploited have been furnished. The petitioner has not denied these statements or offered any cogent explanation for accumulating plots and not using them," the bench noted.


The judges noted that the petitioner was aware of the allotment in favour of Mahindra & Mahindra prior to 15 March 2006, as is evident from the letter dated 15 March 2006, addressed by it to MIDC. "The petitioner never objected to the allotment of the plot by MIDC in favour of Mahindra & Mahindra. This is evident from the correspondence addressed by the petitioner which we have already referred to."


By the letter dated 15 March 2006, the petitioner said that it could be allotted a plot "without disturbing the requirement of Mahindra & Mahindra". By the letter dated 3 April 2006, addressed to the MIDC's chairman, the petitioner requested MIDC to issue "the balance list of open space No.8 of 24,000 square meters left after allotment to Mahindra and Mahindra".


The petitioner, therefore, did not seek to disturb the allotment in favour of Mahindra & Mahindra, the judges further noted.


It was only by the letters dated 3 October 2006, and 10 October 2006, that the petitioner challenged the allotment in favour of Mahindra & Mahindra. This challenge was also essentially only on the basis of MIDC's circular dated 25 January 1994 and not on the basis that the allotment was not in accordance with the procedure or unfair, the bench observed.


As the result, therefore, Mahindra & Mahindra commenced the process as far back as 23 November 2005. There were detailed negotiations between Government of Maharashtra, MIDC and Mahindra & Mahindra with regards to the allotment for the mega project, the court noted.


Crores of rupees have been spent by this company in respect thereof, including the payment of premium of about Rs7.51 crore. The company also had the option to set up the mega project in two other states viz. Andhra Pradesh and Uttarakhand, the judges observed.


"The petitioner took no steps to challenge the allotment, although it knew about the same prior to 15 March 2006. We are not inclined to exercise our jurisdiction under Article 226 to annul the allotment in such circumstances," the judges noted.


Appellate Tribunal dismisses Tata Power's plea over cross subsidy surcharge

The Tribunal dismissed Tata Power's petition challenging MERC's order to impose cross subsidy surcharge from high billing consumers, who have migrated from Reliance Infra to TPC

Mumbai: The Appellate Tribunal for Electricity (ATE) has dismissed the petition of Tata Power Company (TPC) challenging the Maharashtra electricity regulator's order on imposing cross subsidy surcharge from high billing consumers, who have migrated from Reliance Infra to TPC, reports PTI.


Tata Power had challenged the Maharashtra Electricity Regulator Commission's (MERC) order, which allowed Anil Ambani-led RInfra to collect cross-subsidy surcharge from its high-billing customers, who have migrated to rival Tata Power in the interest of the consumers as well as the licensees.


In a September last year, the MERC had said that if high-end consumers of a supplier move to another one under open access system, they will have to continue to cross subsidise the lower-end consumers of their previous supplier.


The ATE, in its order dated 21st December said: "Without reasonable subsidy, there is a possibility that all the consumers in RInfra may move to TPC and in that event, the monopoly of the TPC would be created.


"This action of imposing cross subsidy surcharge is to preserve the competition in order to promote the industry and simultaneously to protect the interest of the consumers".


Under the cross-subsidisation regime, consumers with higher power usage compensate for lower costs per unit charged from those consuming less than 300 units a month.


After the consumers were given the choice to switch power discoms, some high-end customers shifted to Tata Power, which had lower rates as a result of no obligations to serve low-end consumers at cheaper rate, the spokesperson said.


Upholding the decision of the state Commission, the ATE said: "MERC is required to look after not only the interest of the consumers but also the interest of licensees.


"Therefore, the Commission, while deciding that the change over consumers are liable to pay cross subsidy surcharge to RInfra for using their network has in fact taken into consideration the interest of the consumers as well as the interest of the licensees. Therefore, findings and directions given (by MERC), which would promote healthy competition are perfectly justified".


RInfra is at present serving around 28 lakh consumers in its distribution areas in suburbs, out of which, almost 23 lakh consumers are low-end ones, including 12 lakh coming from the unstructured developments in the suburbs, who are cross subsidised.


On the contrary, nearly 90% (bulk) of Tata Power customers include railways, refineries, large housing and commercial complexes and multiplexes.


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