M/S SHREENATH CORP. & ORS.versusCONSUMER EDUCATION & RESEARCH SOCIETY & ORS.

                         [2014] 9 S.C.R. 356


A                MIS SHREENATH CORP. & ORS.
                                   v.
      CONSUMER EDUCATION & RESEARCH SOCIETY &
                           ORS.
              (Civil Appeal No.9052 of 2013)
B
                            JULY 7, 2014
           [SUDHANSU JYOTI MUKHOPADHAYA AND
                  V. GOPALA GOWDA, JJ.]

c        Consumer Protection Act, 1986 - ss. 17 and 19 -
   Complaints filed against the appellants uls.17(1) - State
   Commission directed appellants to pay certain amount with
   interest in favour of the complainants - Appeal against order
   made by the State Commission - Conditional interim order
D of stay passed by National Commission challenged as being
   contrary to the provisions of s. 19 - Held: The second proviso
   to s. 19 mandates pre-deposit for. consideration of an appeal
 . before the National Commission - Such a pre-deposit
   cor'fition has no nexus with the order of stay - If the National
E Commission after hearing the appeal of the parties in its
   discretion wanted to stay the amount awarded, it was open to
   the National Commission to pass an appropriate interim order
   including conditional order of stay - Entertainment of an
   appeal and stay of proceeding putsuant to order impugned
F in the appeal stands at different footings; at two different stages
   -One (pre-deposit) has no nexus with merit of the appeal and
   the other (grant of stay) depends on prima facie case; balance
   of convenience and irreparable loss of, ~arty seei<ing such
   stay - Interference with the impugned order passed by the
G National Commission therefore not called for.

        A number of complaints u/s 17(1) of the Consumer
    Protection Act, 1986 were filed by different persons
    against the appellants. The State Commission directed

H                                 356
  SHREENATH CORP. v. CON. EDU. & RESEARCH· 357
                        soc.
the appellants-opposite parties to pay certain amount with    A
interest in favour of the complainants. Against the
aforesaid orders, the appellants preferred separate
appeals u/s 19 of the Act before the National
Commission. In all these appeals, separate interlocutory
applications for stay were filed by the appellants. The       B
National Commission passed conditional interim order
dated 15th May, 2012, staying the operation of the order
passed by the State Commission till the next <tate subject
to the appellants depositing 50% of the amount awarded
by the State Commission.                                      c
     The interim order dated 15th May, 2012 passed by the
National Commission was challenged before this Court
for being contrary to the provisions of Section 19 of the
Act.
                                                              D
     Dismissing the appeals, the Court
      HELD:1.1. Section 19 of the Consumer Protection
 Act, 1986 deals with appeals againstthe order made by
 the State Commission in exercise of its power conferred      E
 by sub-clause (i) of clause (a) of Section 17. The second
 proviso to Section 19 of the Act relates to "pre- deposit"
 required for an appeal to be entertained by the National
 Commission. The second proviso to Section 19 of the Act
 mandates pre-deposit for consideration of an appeal
                                                              F
 before the National Commission. It requires 50% of the
 amount in terms of an order of the State Commission or
 35,000/- whichever is less for entertainment.of an appeal
 by the National Commission. Unless the ap-pellant has
 deposited the pre-deposit amount, the appeal cannot be
 entertained by the National Commission. A pre-deposit        G
 condition to deposit 50% of the amount in terms of the
 order of the State Commission or Rs.35,000/- being
·condition precedent for entertaining appeal, it has no
 nexus with the order of· stay, as such an order may or
 may not be passed by the National Commission.                H
    358       SUPREME COURT REPORTS [2014] 9 S.C.R.

A Condition of pre-deposit is there to avoid frivolous
  appeals. [Paras 9, 11] [361-C-G; 362-G-H; 363-A]     ·

       1.2. If the National Commissi~n after hearing the
  appeal of the parties in its discretion wants to stay the
8 amount awarded,
                     it is open to the National Commission
  to pass an appropriate interim order including
  conditional order of stay. Entertainment of an appeal and
  stay of proceeding pursuant to order irilpµgned in the
  appeal stands at different footings, at two dt~rent stages.
  One (pre-deposit) has no nexus with merit of the appeal
C and the other (grant of stay) depends on prima facie case;
  balance of convenience and irreparable loss of party
  seeking such stay. In view of the finding recorded above,
  the interference with the impugned order dated 15th May,
  2012 passed by the National Commission is not called
D for. [Paras 12, 13] [363-B-D, E]

        Dr. (Mrs.) K. Kathuria v. National Consumer Disputes
    Redressal Forum, AIR 2007 Delhi 135 and State of Haryana
    v. Maruti Udyog Ltd. and others, (2000) 7 SCC 348 - referred
E   to.                                                 .

                        Case Law Reference:
       AIR 2007 Delhi 135-       referred to        Para 6
       (2000) 1 sec 348          referred to        Para 10
F
        CIVIL APPELLATE JURISDICTION : Civil Appeal No.
    9052 of 2013.

      From the Judgment and Order dated 15.05,2012 in F.A
G No. 95/2012, of the National Consumers Disputes Redressal
  Comimission, New Delhi.

                                 WITH

      C.A. No. 9053, 9054, 9055, 9056, 9057, 9058, 9059,
H 9060, 9061, 9062, 9064, 9065, 9066 of 2013.
 SHREENATH CORP. v. CON. EDU. & RESEARCH·                    359
                           soc.
    H. Ahmadi,Pradhuman Gohil, J.S. Jadeja, Taruna Singh,            A
Vikas Singh for the Appellants.

      Hemantika Wahi, Preetesh Kapur, S. Despande,
Shashank Kunwar, S. Walia, (Parekh & Co.), Abhijeet Sinha
for the Respondents.
                                                                     B
    The Judgment of the Court was delivered by

    SUDHANSU JYOTI MUKHOPADHAYA, J. 1. Leave
granted.

     2. These appeals are directed against common interim
                                                                     c
order dated· 1sth May, 2012 passed by the National Consumer
Disputes Redressal Commission, New Delhi (hereinafter
referred to as the, 'National Commission') in interlocutory
applications for stay in First Appeals preferred by the              D
appellants.

    3. The factual matrix of the case is as follows:-

     A number of complaints u/s 17(1) of the Consumer
Protection Act, 1986 (hereinafte;r referred to as the, 'Act') were   E
filed by different persons before the Consumer Disputes
Redressal Commission, Gujarat State, Ahmedabad
(hereinafter referred to as the, 'State Commission') against the
appellants - opposite parties.

     4. The State Commission by order dated 30th January,            F
2012 allowed the applications in part and directed the
appellants-opposite parties to pay certain amount with interest
in favour of the complainants.

      5. Against the aforesaid orders, t.he appellants preferred     G
separate appeals u/s 19 of the Act before· the National
Commission being First Appeal Nos.91-104 of 2012. In all
these appeals separate interlocutory applications for stay were
filed by the appellants. The National Commission by impugned
common order dated 15th May, 2012 passed conditional                 H
    360         SUPREME COURT REPORTS [2014] 9 S.C.R.


A   interim order which reads as under:

          "Heard.

          Issue notice on main appeal as _well as on stay
          applications to the respondents, returnable on
B         22.11.2012.

          In the meanwhile, operation of the impugned order shall
          remain stayed, till next date, subject to appellants
          depositing 50% of the awarded amount (principal
c         amount), within three months from today, with the State
          Commission.

          On deposit of the amount, State Commission shall put
          the same in fixed deposit in a Nationalized Bank, initially
          for one year.
D
          Dasti."

       6. Learned counsel for the appellant contended that the
  impugned interim order dated 15th May, 2012 passed by the
E National Commission is contrary to the provisions of Section
  19 of the Act. It was further contended that deposit of specific
  amount has been prescribed under the second proviso to
  Section 19 of the Act, and, therefore, the National Commission
  cannot pass an order asking the appellant before it to deposit
F an amount more than 50% of the amount awarded by the State
  Commission or Rs.35,000/- whichever is less. In support of such
  contention learned counsel for the appellant relied upon
  judgment of Delhi High Court in Dr. (Mrs.) K. Kathuria v.
  National Consumer Disputes Redressal Forum, AIR 2007
G Delhi 135.

         7. On the other hand, according to counsel for the.
    respondents, the impugned order is a conditional order of stay
    and is not passed under second proviso to Section 19 of the
    Act.
H
  SHREENATH CORP. v. CON. EDU. & RESEARCH                     361
   SOC. [SUDHANSU JYOTI MUKHOPADHAYA, J.]
     8. After giving our careful.consideration to the facts and       A
circumstances of the case and submissions made by learned
counsel for the parties, we find ourselves entirely in agreement
with the submission made on behalf of the respondents.

     9. Section 19 of the Consumer Protection Act, 1986 deals         B
with appeals against the order made by the State Commission
in exercise of its power conferred by sub-clause (i) of clause
(a) of Section 17 and the said section reads as follows:-

     "19.Appeals.-Any person aggrieved by an order made by
     the State Commission in exercise of its powers·conferred         C
     by sub-clause (i) of clause (a) of Section 17 may prefer
     an appeal against such order to the National
     Commission within a period of thirty days from the date
     of the order in such form and manner as may be
     prescribed:                                                      D

     Provided that the National Commission may entertain an
     appeal after the expiry of the said period of thirty days if
     it is satisfied that there was sufficient cause for not filing
     it within that period:                                           E
     Provided further that no appeal by a person, who is
     required to pay any amount in terms of an order of the
     State Commission, shall be entertained ·by the National
     Commission unless the appellant has deposited in the
     prescribed manner fifty per cent of the amount or rupees         F
     thirty-five thousand, whichever is less."

    On plain reading of aforesaid Section 19, we find that the
second proviso to Section 19 of the Act relates to "pre-
deposit" required for an appeal to be entertained by the              G
National Commission.

       10. This Court in State of Haryana v. Maruti Udyog Ltd. and
. others, (2000) 7sec     348, while dealing with case of waiver
  of "pre-deposit" in an appeal under first proviso to Se_ction
                                                                      H
    362         SUPREME COURT REPORTS [2014] 9 S.C.R.


A   39(5) of the Haryana General Sales Tax Act held:

          "7 ....... ......... There cannot be any dispute that right of
          appeal is the creature of the statute and has to be
          exercised within the limits and according to the procedure
          provided by)aw. It is filed for invoking the powers of a
B
          superior court to redress the error of the court below, if
          any. No right of appeal can be conferred except by
          express words. An appeal, for its maintainability, must
          have a clear authority of law. Sub:section (5) of Section
          39 of the Act vests a discretion in the appellate authority
c         to entertain the appeal if it is filed within sixty days and
          the amount of tax assessed along with penalty and
          interest, if any, recoverable from the persons has been
          paid. The aforesaid restriction is subject to the proviso
          conferring discretion upon the appellate authority to
D         dispense with the deposit of the amount only on proof of ·
          the fact that the appellant was unable to pay the amount.
          Before deciding the appeal, the appellate authority
          affords an opportunity to the party concerned to either pay
          the amount or make out a case for the stay in terms of
E         proviso to sub-section (5) of Section 39 of the Act. Once
          the conditions specified under sub-section (5) of Section
          39 are complied with, the· appeal is born for being
          disposed of on merits after hearing both the sides."

F      11. The second proviso to Section 19 of the Act mandates
  pre-deposit for consideration of an appeal before the National
  Commission. It requires 50% of the amount in terms of an order
  of the State Commission or 35,000/- whichever· is less for
  entertainment of an appeal by the National Commission. Unless
G the appellant has deposited the pre-deposit amount, the appeal
  cannot be entertained by the National Commission. A pre-
  deposit condition to deposit 50% of the amount in terms of the -
  order of the State Commission or Rs.35,000/- being condition
  precedent for entertaining appeal, it has no nexus with the order.
  of stay, as such an order may or .may not be passed by the
H
 SHREENATH CORP. v. CON. EDU. & RESEARCH                    363
  SOC. [SUDHANSU JYOTI MUKHOPADHAYA, J.]
National Commission. Condition of pre-deposit is there to avoid     A
frivolous appeals.

     12. It is not the case of any of-the appellants that the
Consumer Forum including State and National Commissions
has no power to pass interim order of stay. If the National
                                                                    8
Commission after hearing the appeal of the parties in its
discretion wants to stay the amount awarded, it is open to the
National Commission to pass an appropriate interim order
including conditional order of stay. Entertainment of an appeal
and stay of proceeding pursuant to order impugned in the
appeal stands at different footings, at two different stages. One   C
(pre-deposit) has no nexus with merit of the appeal and the
other (grant of stay) depends on prima facie case; balance of
convenience and irreparable loss of party seeking such stay.

     13. In view of the finding recorded above, the interference    D
with the impugned order dated 15th May, 2012 passed by the
National Commission is not called for. In absence of any merit,
the appeals are accordingly dismissed. No costs.
Bibhuti Bhushan Bose                           Appeals dismissed.
                                                                    E




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