# MIS SHREENATH CORP. & ORS v. CONSUMER EDUCATION & RESEARCH SOCIETY & ORS

- **Citation:** [2014] 9 S.C.R. 356
- **Court:** Supreme Court of India
- **Decided:** 2014-07-07
- **Case number:** Civil Appeal No.9052 of 2013
- **Bench:** Sudhansu Jyoti Mukhopadhaya, V. Gopala Gowda
- **Source:** https://unisonlegal.in/judgment/supreme-court-of-india/mis-shreenath-corp-ors-v-consumer-education-research-society-ors-30204
- **Pages:** 8

## Headnote

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.
H
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
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.
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
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
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
D
E
F
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

## Text

A
B
c
[2014] 9 S.C.R. 356
MIS SHREENATH CORP. & ORS.
v.
CONSUMER EDUCATION & RESEARCH SOCIETY &
ORS.
(Civil Appeal No.9052 of 2013)
JULY 7, 2014
[SUDHANSU JYOTI MUKHOPADHAYA AND
V. GOPALA GOWDA, JJ.]
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.
H
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
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.
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
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
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
D
E
F
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.
.
F
Case Law Reference:
AIR 2007 Delhi 135-
(2000) 1 sec 348
referred to
referred to
Para 6
Para 10
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.
The Judgment of the Court was delivered by
SUDHANSU JYOTI MUKHOPADHAYA, J. 1. Leave
granted.
2. These appeals are directed against common interim
B
c
order dated· 1 sth 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,
2012 allowed the applications in part and directed the
appellants-opposite parties to pay certain amount with interest
in favour of the complainants.
F
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:
B
c
D
"Heard.
Issue notice on main appeal as _well as on stay
applications to the respondents, returnable on
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
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.
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.
H
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.
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
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
B
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:
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
thirty-five thousand, whichever is less."
E
F
On plain reading of aforesaid Section 19, we find that the
second proviso to Section 19 of the Act relates to "predeposit" 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) 7 sec 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:
B
c
D
E
"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
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
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
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
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 predeposit 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
i