MANUFACTURER CANNOT BE HELD AT FAULT FOR SALE OF DEFECTIVE PRODUCT UNLESS HIS/HER KNOWLEDGE CAN BE PROVED- SC

26the Feb 2021

The Supreme Court held that deficiency in a product due to dealers' fault will not make the manufacturer at fault unless he/she knew of the deficiency.

Antonio Paulo Vaz filed a complaint in the Goa District Redressal forum about selling a 2009 model car in place of a new car. Vaz requested a refund of the payment paid or replacement of the car, but neither was done. The District forum held deficiency on the part of manufacturer and dealer. The same was upheld by the State Commission and National Consumer Disputes Redressal Commission.

The Appellant (Tata Motors Limited) filed an appeal in the Supreme Court against the decision of NCDRC. The Supreme Court set aside the findings of the lower forums. Stating that findings against the manufacturer were not justified, “ Unless the manufacturer’s knowledge is proved, a decision fastening liability upon the manufacturer would be untenable, given that its relationship with the dealer, in the facts of this case, was on the principal-to-principal basis”. And the complainant can execute an alternative relief through the district forum.

Author: Papiha Ghoshal