Holding

Jurisdiction under Section 17(2) of the Consumer Protection Act lies with the State Consumer Redressal Commission where the cause of action arose, and the amendment concerning branch offices does not apply to pre‑amendment complaints, rendering the Chandigarh commission without jurisdiction.

Summary

A fire broke out in the appellant's godown at Ambala in February 1999, and the appellant filed a claim petition before the Consumer Commission of Chandigarh in 2000, which was allowed. The National Consumer Disputes Redressal Commission set aside that order, holding that the Chandigarh commission lacked jurisdiction. The appellant argued that the insurance company had a branch in Chandigarh and, under the amended Section 17(2) of the Consumer Protection Act, 1986, the complaint could be filed there. The Supreme Court held that the cause of action arose in Ambala, not Chandigarh, and that the amendment (effective March 2003) could not apply to a complaint filed in 2000. Even if applicable, "branch office" must be interpreted to mean the branch where the cause of action arose, to avoid absurdity and bench‑hunting. Consequently, only the Haryana State Consumer Redressal Commission had jurisdiction, and the appeal was dismissed, upholding the NCDRC order.

Issues considered

The appropriate forum for a consumer complaint under Section 17(2) of the Consumer Protection Act, 1986, when the cause of action arose in a different location.
Whether the amendment to Section 17(2) (effective 15‑03‑2003) applies to a complaint filed in 2000 and a cause of action arising in 1999.
The proper interpretation of the term "branch office" in Section 17(2)(b) – whether any branch of the opposite party suffices or only the branch where the cause of action arose.
Whether allowing filing in any state where the opposite party has a branch would lead to absurd consequences and bench hunting.

Legislation cited

Consumer Protection Act, 1986s. 17(2)

Subjects

Consumer Protection Actjurisdictioncause of actionSection 17(2)branch officebench huntinginsurance claimConsumer Redressal Commission

Judgment

[2009] 15 (ADDL.) S.C.R. 265

SONIC SURGICAL A
v.
NATIONAL INSURANCE COMPANY LTD.
(Civil Appeal No. 1560 of 2004)

OCTOBER 20, 2009
B
[MARKANDEY KATJU AND ASOK KUMAR
GANGULY, JJ.)

Consumer Protection Act, 1986: s.17(2) - Jurisdiction -
Cause of action - Fire broke in godown of appellant at Ambala C
- Complaint filed before Consumer Commission at
Chandigarh - Maintainability of - Held: Not maintainable -
Consumer Commission, Haryana alone has jurisdiction to

- entertain the complaint - Plea of appellant was that insurance
company has branch office at Chandigarh and under the D
amended s.17(2) the complaint could be filed at Chandigarh
- Such interpretation of amended s. 17(2) would lead to
absurd consequences and lead to bench hunting -
Expression 'branch office' in the amended s.17(2) would mean
the branch office where the cause of action arose,_ Cause of E
action.

Fire broke out in the godown of appellant at Ambala.
Appellant filed claim petition before Consumer
Commission, Chandigarh which was allowed. National
... Commission set aside the order holding that Consumer
Commh. ·ior at Chandigarh had no jurisdiction to
F

entertain tne complaint.

In appeal to this Court, appellant contended that the
respondent-insurance company had a branch office at G
Chandigarh and hence under the amended Section 17(2)
of the Consumer Protection Act, 1986, the complaint
could be filed in Chandigarh.

265 H

-
/
266 SUPREME COURT REPORTS [2009] 15 (ADDL.) S.C.R.

A Dismissing the appeal, the Court

HELD: 1. It is well settled that the expression 'cause
of ~ction' means that bundle of facts which gives rise to
a right or liability. In the present case admittedly fire broke ~

out in the godown of the appellant at Ambala. The
B
insurance policy was also taken at Ambala and the claim
for compensation was also made at Ambala. Thus, no
part of the cause of action arose at Chandigarh. [Para 4]
(268-C] ._ ' ,

c IFB Automotive Seating and System Ltd. and Others v.
Union of India AIR 2003 Calcutta 80, approved.

Union of India v. Adani Exports Ltd. AIR 2002 SC 126,
referred to.
"'.
D 2. The amendment in Section 17(2) of the Consumer -f
Protection Act came into force w.e.f. 15.3.2003 whereas
the complaint io th~ present case was filed in the year
2000 and the cause of action arose in 1999. Hence, the
amended section would not have application to the case
E at hand. If the contention of the appellant is accepted, it
would mean that even if a cause of action has arisen in
Ambala, then too the complainant can file a claim petition
even in Tamil Nadu or Gauhati or anywhere in India where
Id
a branch office of the insurance company is situated. It
F would lead to absurd consequem~es and lead to bench
hunting. ·The expression 'branch office' in the amended
Section 17(2) would mean the branch office where the
cause of action has arisen. No. doubt this would be
departing from the plain and literal words of Section
G 17(2)(b) of the Act but such departure is sometimes
necessary (as it is in this case) to avoid absurdity. [Paras
8 and 9] (270-F-H; 271-A-C]

G.P. Singh's Principles of Statutory Interpretation, Ninth
Edition, 2004, referred to.
H

-
SONIC SURGICAL v. NATIONAL INSURANCE 267
COMPANY LTD.
3. Since the cause of action arose at Ambala, the A
State Consumer Redressal Commission, Haryana alone
will have jurisdiction to entertain the complaint. [Para 10)
[271-D-E]
Case Law Reference:
B
AIR 2003 Calcutta 80 approved Para 5
AIR 2002 SC 126 referred to Para 5
CIVIL APPELLATE JURISDICTION : Civil Appeal No.
1560 of 2004. C

From the Judgment & Order dated 10. 7.2003 of the
National Consumer Disputes Redressal Commission, New
Delhi in First Appeal No. 124 of 2002.

Anil Nag for the Appellant. D

Tanmapa Mehta (for P.N. Puri) for the Respondent.

The following Order of the Court was delivered

ORDER E
1. Heard learned counsel for the parties.

2. This appeal by special leave has been filed against the
order dated 10th July, 2003 of the National Consumer Disputes
Redressal Commission, New Delhi (for short 'NCDRC') F
whereby the appeal filed by the respondent herein has been
allowed and the order of the Consumer Disputes Redressal
Commission Union Territory, Chandigarh has been set aside.

3. It appears that there was a fire on 13-14th February,
1999 at 10.00 p.m. in the godown of the appellant at Ambala. G
For claiming compensation, the appellant filed a claim petition
before the Consumer Commission of the Union Territory,
Chandigarh constituted under Section 17 of the Consumer
Protection Act, 1986 (hereinafter for short 'the Act'). The said
H
268 SUPREME COURT REPORTS [2009] 15 (ADDL.) S.C.R.

A claim petition filed by the appellant herein was allowed by the
Consumer Commission of the Union Territory, Chandigarh. On
appeal, the NCDRC allowed the appeal of the respondent
herein on the ground that the Consumer Commission at
Chandigarh had no jurisdiction to entertain and adjudicate the
B complaint. We are in agreement with the view taken by the
NCDRC.

4. In our opinion, no part of the cause of action arose at
Chandigarh. It is well settled that the expression 'cause of

c
action' means that bunqle of facts which gives rise to a right or
liability. In the present cas-e admittedly the fire broke out in the
"
godown of the appellant at Amba.@. The insurance policy was
also taken at Ambala and the claim for compensation was also
made at Ambala. Thus no part of the cause of action arose in
Chandigarh.
D 'f
5. One of us (Hon'ble Mr. Justice Asok Kumar Ganguly)
while a Judge of the Calcutta High Court in the case of IFB
Automotive Seating and System Ltd. and Others Vs. Union
of India AIR 2003 Calcutta, 80 has dealt with the question as
to the meaning of the expression 'cause of action'. Placing
E
reliance on a decision of this Court in the case of Union of India
Vs. Adani Exports Ltd. AIR 2002 SC 126, in para 40 of the
said judgment it has been observed as under:-
,;-
"In Adani Exports (AIR 2002 SC 126) (supra) the learned
F Judges in para 13 set out the facts pleaded by the - ~

'
petitioner to give rise to cause of action conferring territorial
jurisdiction on the Court at Ahmedabad. One of the facts
pleaded is that non-granting and denial utilization of the
credit in the pass book will affect the business of the
G respondents at Ahmedabad. This fact is not pleaded in the
case in hand.

Even then the learned Judges held that those facts
are not sufficient to furnish a cause of action as they are
not connected with the relief sought for by the respondents.
H
- SONIC SURGICAL v. NATIONAL INSURANCE 269
COMPANY LTD.

Here also the relief is against the orders of approval A
and this High Court has no territorial jurisdiction to grant
that relief. Therefore, the communication to the effect that
the petitioners' representation against orders of approval
is rejected is of no consequence.
B
The Supreme Court, further dealing the concept of
Article 226(2) and relying on the decision of ONGC (1994
AIR SCW 3287), explained the concept of cause of action
·'
4 in para 17 at page 130 of the report and the relevant
extracts wherefrom are excerpted below :
c
"It is clear from the above judgment that each and every
fact pleaded by the respondents in their application does
not ipso facto lead to the conclusion that those facts give
rise to a cause of action within the Court's territorial
jurisdiction unless those facts pleaded are such which have D
a nexus or relevance with the lis that is involved in the case.
Facts which have no bearing with the lis or the dispute
involved in the case, do not give rise to a cause of action
so as to confer territorial jurisdiction on the Court
'
~ concerned. E

The learned Judges also held in para 18 as follows :

"The non-granting and denial of credit in the
passbook having an ultimate effect, if any, on the business
of the respondents at Ahmedabad would not also, in our F
opinion, give rise to any such cause of action to a Court
at Ahmedabad to adjudicate on the actions complained
against the appellants."

6. We respectfully agree with the view taken by the Calcutta G
High Court in the aforesaid decision of /FB Automotive Seating
t- (supra). Hence, in our opinion, no part of the cause of action in
the present case arose at Chandigarh.

7. Learned counsel for the appellant then invited our
H
._/

~

270 SUPREME COURT REPORTS [2009] 15 (ADDL.) S.C.R.

A attention to the amendment brought about in Section 17(2) of
the Act in the year 2003. The Amended Section 17(2) of the
Act reads as under:-

"(2) A complaint shall be instituted in a State Commission
within the limits of whose jurisdiction,-
B
(a) the opposite party or each of the opposite parties,
where there are more than one, at the time of the
institution of the complaint, actually and voluntarily "f '",
resides or carries on business or has a branch
c office or personally works for gain; or

(b) any of the opposite parties, where there are more
than one, at the time of the institution of the
complaint, actually and voluntarily resides, or carries
D on business or has a branch office or personally
....
works for gain, provided that in such case either the
permission of the State Commission is given or the
opposite parties who do not reside or carry on
business or have a branch office or personally
'
works for gain, as the case may be, acquiesce in ~
E
such institution;

(c) the cause of action, wholly or in part, arises."
v .
8. The aforesaid amendment came into force w.e.f.
15.3.2003 whereas the complaint in the present case has been
... ~~

F \-
filed iri the year 2000 and the cause of action arose in 1999.
Hence, in our opinion, the amended section will have no ..··!-
application to the case at hand. .J

9. Morea' er, even if it had application, in our opinion, that
G will not help the case of the appellant. Learned counsel for the
. \
j

appellant submitted that the respondent-insurance company --1
has a branch office at Chandigarh and hence under the
amended Section 17(2) the complaint could have been filed in
Chandigarh. We regret, we cannot agree with the learned '
•
H
SONIC SURGICAL v. NATIONAL INSURANCE 271
COMPANY LTD.
counsel for the appellant. In our opinion, an interpretation has A
i
to be.. given to the amended Section 17(2) (b) of the Act, which
does not lead to an absurd consequence. If the contention of
the learned counsel for the appellant is· accepted, it will mean
that even if a cause of action has arisen in Ambala, then too
the complainant can file a claim petition even in Tamil Nadu or B
Gauhati or anywhere in India where a branch office of the
insurance company is situated. We cannot agree with this
contention. It will lead to absurd consequences and lead to
bench hunting. In our opinion, the expression 'branch office' in
the amended Section 17(2) would mean the branch office c
where the cause of action has arisen. No doubt this would be
departing from the plain and literal words of Section 17(2)(b)
of the Act but such departure is sometimes necessary (as it is
in this case) to avoid absurdity. [vide G.P. Singh's Principles

.. of Statutory Interpretation, Ninth Edition, 2004 P. 79]
D
10. In the present case, since the cause of action arose
at Ambala, the State Consumer Redressal Commission,
Haryana alone will have jurisdiction to entertain the complaint.

11. For the reasons stated hereinabove, we do not see E
any reason to interfere with the impugned order of the NCDRC.
Accordingly, this appeal is dismissed. No order as to the costs.

"'"'D.G. Appeal dismissed.