Friday, April 6, 2018
An article titled "Director General of Civil Aviation (DGCA) need to intervene and frame out policy on cancellation fee chargeable by the Airlines and to withdraw the practice of charging for preferential seat allocation" was published in this blog on 13/03/2018. The link to the article is
Subsequent to the article, the same was posted to DGCA. A petition has also been created titled "Airlines must charge only 20 pct of ticket value as cancellation charges ". It is felt that we jointly have to raise our voice so that Govt. of India is compelled to intervene and frame a policy to restrict the cancellation fee not more than 20% of the air fare. The link to the petition is:
The citizens may like to contribute to the social justice as the issue is of public interest. The link can also be shared on various public domain like facebook, twitter so that the petition is signed by as many people as possible. The more the signatures, the more it will compel Govt. of India for fair business.
Monday, March 19, 2018
Alleged unfair business practices of Retailers like Home Saaz, Lefestyle, Shoppers Stop, Pantaloons and others charging taxes on discounted sale price
Several posts have been written on this blog from 2014 onwards about unfair business practices of the retailers like Home Saaz, Lifestyle, Pantaloons, Shoppers Stop and others on charging of taxes on discounted sales prices. Some of the retailers have even been prosecuted but despite prosecution continue to carry out unfair business. Recently on a complaint against Home Saaz about adoption of the similar practices, the Home Saaz was challaned for the same.
In a recent judgment on 06/02/2018, The Hon'able District Consumer Forum, Ludhiana in a complaint number No. 741 of 11.10.2017 of Mr. Brij Mohan, Chandigarh vs. The Mandhana Retail Ventures Limited, Being Human-Silver Arc. Gr.Floor, Store No.10, Gurdev Nagar, Near Arti Chowk, Firoz Road, Ludhiana-141001 has termed such practices as unfair trade practices and have imposed a cost of Rs. 4,000/- to be paid by the company to the consumer. A full judgement of the same is quoted below which can be used by the consumers who are being charged of such taxes on discounted sales:
"1. Complainant purchased one product bearing MRP of Rs.1779/- from Op because of given offer of 30% discount. After that discount, the price came to Rs.1259.30P, but by charging VAT @6.05% of amount of Rs.76.19P, amount of Rs.1335/- charged from the complainant. Charging of VAT on discounted price alleged to be an unfair trade practice and that is why, this complaint for seeking refund of excess charged VAT amount of Rs.76.19P along with compensation on account of mental and physical harassment of Rs.25,000/- and litigation expenses of Rs.15,000/-.
2. OP is ex-parte in this case.
3. Counsel for complainant in ex-parte evidence tendered affidavit Ex.CA of complainant along with documents Ex. C1 and Ex.C2 and thereafter, closed the evidence.
4. Written arguments not submitted, but oral arguments of counsel for complainant heard. Records gone through carefully.
5. Perusal of affidavit Ex.CA of complainant along with retail invoice Ex.C1 and tag on the product Ex.C2 shows as if the product purchased by the complainant was bearing MRP of Rs.1799/-(inclusive of all taxes). In retail invoice Ex.C1, it is mentioned as if the discount of Rs.549.70P given and VAT of amount of Rs.76.19P charged. As the VAT has been charged on discounted price, despite the fact that MRP was inclusive of all taxes and as such, OP adopted unfair trade practice, due to which, complainant suffered mental tension, agony and harassment, resulting in institution of this complaint by him.
6. As per law laid down in cases titled as M/s. Aero Club (Woodland) through its Manager vs. Rakesh Sharma, bearing Revision No.3477 of 2016 decided on 4.1.2017 by the Hon'ble National Consumer Disputes Redressal Commission, New Delhi and Ethnicity vs Heena Aggarwal-2017(1)CLT-621(Chandigarh State Consumer Disputes Redressal
Commission ), in case, discount on MRP is given under circumstance that MRP is inclusive of all taxes, then act of deliberately charging VAT and other taxes on price after discount is an unfair trade practice.
7. In view of adoption of unfair trade practice, complaint deserves to be allowed with direction to OP to refund the excess charged amount of Rs.76.19P with interest @6% per annum w.e.f. the date of purchase namely 29.6.2017 till payment.
8. Therefore, as a sequel to the above discussion, complaint allowed ex-parte in terms that OP will refund excess charged amount of Rs.76.19P(Rs.Seventy six & ps.nineteen only) with interest @6% per annum w.e.f. 29.06.2017 till payment. Compensation for mental harassment of
Rs.2,000/- (Rupees Two Thousand only) and litigation expenses of Rs.2,000/- (Rupees Two Thousand only) more allowed in favour of complainant and against OP. Payment of this amount of compensation and litigation expenses be made within 30 days from the date of receipt of copy of
order. Copies of order be supplied to parties free of costs as per rules."
I am attaching a snap of the property at Sector 37 Faridabad, the wall of which has been defaced by Aam Aadmi Party on 18th March 2018 for an election rally in Hisar scheduled 25th March 2018. As can be seen that even the house number got hidden due to defacing the wall.
The message was posted on facebook and twitter duly tagging the Chief Minister Delhi, Shri Arvind Kejriwal and Shri Sanjay Singh, MP. The same was also posted tagging Chief Minister Haryana. However, it is surprising that the politicians preferred to maintain silence. Is it the way that Aam Aadmi Party (AAP) want to clean the system by defacing walls of the personal properties. Time to revisit the objectives. Hope Municipal Corporation of Faridabad would look into the issue.
Tuesday, March 13, 2018
Director General of Civil Aviation (DGCA) must regulate cancellation fee/ rescheduling fee,preferential seat allocation fee being charged by Airlines
Director General of Civil Aviation (DGCA) need to intervene and frame out policy on cancellation fee chargeable by the Airlines and to withdraw the practice of charging for preferential seat allocation
Recently a ticket booked for Delhi- Ahmedabad-Delhi on 2nd February 2018 for scheduled Departure on 25th February 2018 and scheduled return journey on 28th February 2018 was required to be cancelled on 22nd February 2018. Surprisingly, the amount of refund by the intended passenger as received was merely Rs. 493/- out of the paid amount of Rs. 6,243/- deducting an amount of Rs. 5,750/- supposedly to be the cancellation fee.
Amount deducted: Rs. 5,750
Amount refunded: Rs. 493
With such a high amount being deducted towards cancellation fee, there is a need for intervention of DGCA appropriately to regulate the cancellation fee being deducted by the Airlines and the agents.
The Airlines are in the transport business of carrying the passengers and thus logically the charges or the fare need to be charged only when the passenger is availing the transport services. Transport services are the main area of the Airlines business and hence the income needs to be only out of transport services. In the instant case the passenger has paid an amount of Rs. 5,750/- without even availing the transport services of the Airlines thus violating the Consumer Protection Act, 1986. As per basic principles of Consumerism, the consumer is required to pay the charges for availing the services. In the present case, the passenger would have paid an amount of Rs. 6,243/- for travelling to Delhi- Ahmedabad- Delhi but has paid an amount of Rs. 5,750/- without even travelling or using any other services of the Airlines, Airport etc. The break up of the ticket fare as shown in the ticket was
Basic fare : Rs. 5,287
Taxes and other charges : Rs. 956
While the basic fare was Rs. 5,287/-, the cancellation fee paid by the passenger who has not neither travelled nor utilised any iota of services is Rs. 5,750/-. Had he travelled and utilised the services of Airlines and Airport, he would have paid Rs. 5,287/- but by not travelling, he has paid Rs. 5,750/- . The cancellation fee in the present case comes to 109% of the airline fare and 92% of the total ticket cost. It seems to be highly illogical and could be even termed as unprofessional/ unfair business practices. There is an urgent need for its rationalisation.
As per CAR SECTION 3 – AIR TRANSPORT SERIES ‘M’, PART II ISSUE I, DATED 22 May, 2008 ,
“ (d) Airlines shall necessarily return the PSF collected by them from the passengers on non-utilization/ cancellation of tickets.
(e) Airlines shall refund any charges such as congestion charge, fuel surcharge etc., along with the refund of the ticket, unless these are clubbed with basic fares.”
Same CAR effective 1st August 2016 also states:
“The airlines shall refund all statutory taxes and User Development Fee (UDF)/Airport Development Fee (ADF)/Passenger Service Fee (PSF) to the passengers in case of cancellation/non-utilisation of tickets/no show. This provision shall also be applicable for all types of fares offered including promos/special fares and where the basic fare is non-refundable.”
It further states that “Under no circumstances, the airline shall levy cancellation charge more than the basic fare plus fuel surcharge. i) The airlines shall not levy any additional charge to process the refund.”
Even for the time being keeping aside the ethics of professional business practices, in the instant case, the Airline should have refunded at least an amount of Rs. 956/- instead of Rs. 493/-.
The intended passenger had also petitioned the issue on a Local Circle Community to seek the public reaction and looking at the comments of the public being the perspective consumers of Airlines, the situation seems to be indicative of unprofessionalism prevailing in the Airlines sector. The Airlines have now even started charging an additional amount as preferential seat allocation fee. The preferential seat allocation charges being charged by the Airlines put inconvenience to two or more passengers travelling together or may be wife and husband or the senior citizens travelling with their younger ones as when checked in without paying any preferential seat allocation fee shall be are seated in the different middle rows of the seats thus making them feel uncomfortable throughout the entire journey specially when the ladies are carrying their minor children with them. Having fare been charged from the passengers, the charging of fee for preferential seat become of unethical business practices. Further it has also been reported by one of the person that the fare between Delhi- Chandigarh by Jet Airways was less than the cancellation fee. The ticket cost has been indicated as Rs. 2,403/- and the cancellation fee as Rs. 3,900/-. Most of the comments from the intellectual members on the Local Circle Community have opined for immediate intervention of DGCA, the Regulatory Authority for Airlines Sector to rationalise the amount of fee towards cancellation/ rescheduling fee and removal of preferential seat allocation fee. However, there is also a need to simplify the nomenclature being used by Airlines in charging the fee under different heads as different airlines are using different nomenclature.
In view of the above, there is a necessity for intervention of DGCA appropriately in rationalising the
- Cancellation fee/ ticket rescheduling charges. The cancellation fee or rescheduling charges need to be charged either as %age of the ticket basic fare or a nominal fixed amount not more than the basic fare. In our considered opinion, the same could be restricted to 10% of the basic fare if it is cancelled / rescheduled more than 48 hrs before the scheduled departure and not to exceed 50% if cancelled within 48 hrs to 8 hrs before the scheduled departure. In case the passenger cancels the ticket less than 8 hrs prior to the scheduled departure, the cancellation fee may not exceed the basic fare with refund of all other charges other than basic fare. Similarly in our considered opinion, the rescheduling charges may be capped at Rs. 500/- per ticket.
2. Removal of preferential seat allocation fee.
Friday, February 9, 2018
Pettition to Department of Consumer Affairs for intervening in stopping unfair business by major retailers like Lifestyle, Shoppers Stop, Myntra, Jabong, Pantaloons, Home Saaz etc.
Petition to Department of Consumer Affairs for intervening in stopping unfair business by major retailers like Lifestyle, Shoppers Stop, Myntra, Jabong, Pantaloons, Home Saaz etc.
I have been bringing to the notice of Govt. of India about the unfair business being carried out by major retailers like Lifestyle, Shoppers Stop, Myntra, Jabong, Pantaloons, Home Saaz etc. Several articles have been written on this blog since 2014, The copy of the Posts were being mailed to the respective retailers.However, the practice still continues as on date. The unfair business practices of these retailers are being derived out of charging taxes on the discounted sale price. The discounted sale price after factoring with the discount rate become revised MRP and hence charging of any tax on the MRP is unfair trade practices. Hon'able State Commission and Hon'able National Commission have already termed charging of tax on such discounted prices as unfair business practices and imposed penalties onto them for such unfair business. To a great dismay, these retailers are flouting the rules and continue with their such unfair trade practices (UTP). The attention of Department of Consumer Affairs (DCA) have been drawn to consider issue of necessary notification so as to curb the unfair business of the retailers. The content of my petition raised through a Local Circle Community is reproduced below:
"It has been noticed that the major retailers like Home Saaz, Myntra, Jabong, Pantaloons, Shoppers Stop, Lifestyle are adapting to unfair business practices by charging taxes on the discounted prices so arrived after earmarking for the offered discounts. Since the MRP is alwayz inclusive of taxes as per MRP rules for the packaged commodities, the discounted prices also become inclusive of Taxes in that proportion. The charging of taxes on such discounted prices is not only amounting to violation of MRP rules but also mislead the consumers as the product does not get purchase at the net discounted prices. Honable State Commissions and Honable National Commission have already adjudicated the matter and termed charging of taxes on discounted prices as unfair business practices. The petitioner on various occasions have got refund of the excess amount as and when the issue taken up but the practices still continues affecting almost all consumers who either or not aware or unable to raise the voice against such deceptive practices. I appeal to all the members to kindly sign the petition with their comments so that we are able to stop such deceptive trade practices. The Controller of Legal Metrology and Director, Legal Metrology are appealed to issue necessary notification for the benefit of the consumers across the country. Meanwhile I have already reported matter against Home Saaz Faridabad to Controller Legal Metrology, Haryana for taking penal action."
The readers and visitors of this blog are appealed to kindly visit the following link and sign the petition so that we together can make a change in the deceptive trade practices prevailing in the system
Please share the article as much as possible on face book, twitter, email etc. so as to gain the momentum of our contribution to the society by being vigilant to the unfair businesses.