Nov 17, 2023

Court Speak: Understanding the Jargon

Recently, the Supreme Court in the case, M/S. Rajasthan Art Emporium v. Kuwait Airways and Anr observed that a party is not entitled to seek relief that the complainant does not specifically pray for. This is a law that the Supreme Court reiterated as seen in the case of Bharat Amratlal Kothari vs. Dosukhan Samadkhan Sindhi and Ors, stating that there is no provision or inherent power that authorises courts to grant relief that the petitioner has not explicitly requested for

In this Weekly, let’s simplify what some of these terms commonly used in courts, for matters where people approach the court for compensation or other forms of relief in consumer courts, mean. 

Who is a complainant?

 A complainant is the person who files the case and initiates a legal proceeding. According to section 2(5) of the Consumer Protection Act, 2019, a “complainant” will include:

  • Any consumer
  • Any registered association of consumers
  • The Central or the State Government 
  • Any Central Authority
  • One or more consumers having the same grievance
  • The legal heirs of the consumer in case of their death
  • The parents or guardians of the consumer in case they are minor

Who is a respondent?

A respondent is that person or persons against whom the case has been filed. A complainant and respondent are together referred to as the parties to the case.

What is compensation?

Anything of value, usually money, that a person gives to another for the damage the person giving the compensation caused to the other person.

What is monetary relief?

A party that has been wronged or aggrieved can claim monetary damages against the other person who wronged them. This can be for a breach of contract or for any loss that the aggrieved person suffered because of the other person. Compensatory damages refer to the money that the court awards to the complainant to compensate for the damage, injury, or other loss they have suffered as a result of another party’s negligence or unlawful conduct.  

You may also sometimes hear the term ‘nominal damages’. This refers to a small sum of money that the court awards as damages to someone who has suffered a legal wrong but no actual financial loss.

Sometimes, parties can agree upfront in a contract between themselves what the damages in case of a breach of contract should be. These pre-decided damages are referred to as liquidated damages. These are a form of compensatory damages and are often also called “reasonable compensation”. Disputes over the liquidated damages arise if the violating party refuses to pay the liquidated damage or if the exact loss is in excess or less than the amount specified under liquidated damages. Courts decide the merits of such claims based on the facts of the matter. 

In certain cases, a contract may also fix a sum as compensation which may be in excess of the likely loss. This is then called “penalty”. A penalty differs from liquidated damages since the latter refers to the exact amount or a reasonable estimate of the likely loss. A penalty is often included in a contract to dissuade the parties from any potential breach. However, such clauses can only be enforced if the court considers it to be reasonable compensation.

What happened in this case? 

An exporter of handicrafts goods (complainant) filed a complaint against Kuwait Airways (respondent 1) and Dagga Air Agents (respondent 2). Kuwait Airways agreed to ship the goods within 7 days, but they did not reach the destination as per the delivery schedule. Aggrieved of this, the complainant had asked for a refund of Rs. 24,48,345/ as fair charges for the consignments along with a sum of Rs. 20 lakhs as compensation for loss of business and reputation and the value of goods which were not delivered on time estimated at $ 7042.00 with an interest @ 18%, as well as cost of litigation. The National Consumer Disputes Redressal Commission, NCDRC held that the complainant was entitled to compensation of Rs 20 lakh along with interest @ 9% till its realisation, litigation charges and a compensation for Rs. 5 lakhs for harassment and mental agony. Now, the NCDRC arrived at this judgement after noting that although the actual loss incurred exceeded Rs 20 lakhs, since the complainant had claimed only Rs 20 lakhs, they would not be entitled any amount exceeding that. 

The complainant filed an appeal in the Supreme Court claiming that they should be paid the entire amount of the loss.The Supreme Court upheld the order of NDRC and observed  that the complainant cannot be granted more relief than what is sought. The Court upheld the decision of the NCDRC, citing Section 21(a)(i) of the Consumer Protection Act, 1986, that since the complainant sought damages for Rs 20 Lakh only as compensation for loss of business and reputation, they will be granted only that as compensation. 

What is the National Consumer Disputes Redressal Commission (NCDRC)?

The National Commission is the upper-most authority for consumer complaints redressals. It is located in New Delhi. Complaints about goods or services whose value is above Rupees 10 crores, and appeals against the orders of the State Commission or the Central Consumer Protection Authority, can be filed with the NCDRC. An appeal against the decision of the National Commission can be filed with the Supreme Court within a period of 30 days from the date of the order passed. The orders of the Commission are published on its website. The National Commission portal also provides video instructions pertaining to registration and filing of an electronic complaint through its forum.

To learn more about filing a consumer complaint, click here.