2022 (3) TMI 310 - SC - Indian Laws

Section 7B Telegraph Act arbitration clause doesn't exclude consumer forum jurisdiction for telecom disputes

Vodafone Idea Cellular Ltd. Versus Ajay Kumar Agarwal

The SC held that Section 7B of the Indian Telegraph Act 1885, which provides for statutory arbitration for disputes between telegraph authorities and ... Interpretation of statute - jurisdiction of consumer forum - whether Section 7B of the Indian Telegraph Act 1885 ousts the jurisdiction of the consumer forum in deciding a dispute between a telecom company and a consumer? - HELD THAT:- Under Section 7B, any dispute concerning a telegraph line, appliance or apparatus, between the telegraph authority and the person for whose benefit the line, appliance or apparatus is or has been provided has to be determined by arbitration. Such a dispute has to be referred to an arbitrator appointed by the Central Government either especially for the determination of that dispute or generally for the determination of the disputes under the Section - The only distinction in the present case is that where Section 7B of the Act of 1885 applies, a statutory remedy of arbitration is provided. The fact that the remedy of an arbitration under the Act 1885 is of a statutory nature, would not oust the jurisdiction of the consumer forum. The Act of 1986 and its successor, the Act of 2019 are subsequent enactments which have been enacted by Parliament to protect the interest of consumers. Hence, an ouster of jurisdiction cannot be lightly assumed unless express words are used or such a consequence follows by necessary implication. In Emaar MGF Land Ltd. [2018 (12) TMI 1940 - SUPREME COURT], this Court held that the complaint under the Act of 1986 is a special remedy provided to Imperia Structuresa consumer in addition to the remedies that can be availed of by them, including arbitration. In Imperia Structures Ltd. v Anil Patni [2020 (11) TMI 189 - SUPREME COURT], this Court held that the remedies available under the Act of 1986 are in addition to the remedies available under other statutes, including special statutes like the Real Estate (Regulation and Development) Act 2016 “RERA”. In the present case, the existence of an arbitral remedy will not, therefore, oust the jurisdiction of the consumer forum. It would be open to a consumer to opt for the remedy of arbitration, but there is no compulsion in law to do so and it would be open to a consumer to seek recourse to the remedies which are provided under the Act of 1986, now replaced by the Act of 2019. The insertion of the expression ‘telecom services’ in the definition which is contained in Section 2(42) of the Act of 2019 cannot, for the reasons which we have indicated be construed to mean that telecom services were excluded from the jurisdiction of the consumer forum under the Act of 1986. On the contrary, the definition of the expression ‘service’ in Section 2(o) of the Act of 1986 was wide enough to comprehend services of every description including telecom services. Appeal dismissed. Issues Involved:1. Whether Section 7B of the Indian Telegraph Act 1885 ousts the jurisdiction of the consumer forum in disputes between a telecom company and a consumer.Detailed Analysis:Jurisdiction of Consumer Forum vs. Arbitration under Section 7B1. Background of the Case:- The civil appeal arises from a judgment by the National Consumer Disputes Redressal Commission (NCDRC) regarding the jurisdiction of consumer forums in disputes involving telecom companies.- The respondent filed a consumer complaint alleging a deficiency of service by the appellant, a telecom service provider, after receiving an excessively high bill.2. Appellant's Argument:- The appellant argued that Section 7B of the Indian Telegraph Act 1885 provides a statutory remedy of arbitration, which ousts the jurisdiction of the consumer forum.- The appellant relied on the definitions of 'telecom officer' and 'telegraph authority' in the Act.3. Consumer Forum's Jurisdiction:- Section 11 of the Consumer Protection Act 1986 specifies the jurisdiction of the District Forum to entertain complaints where the value of goods or services and compensation claimed does not exceed Rs. 20 lakhs.- The definition of 'service' under Section 2(o) of the Act is broad and includes services of any description made available to potential users, excluding services rendered free of charge or under a contract of personal service.4. Legislative Intent:- The Consumer Protection Act 1986 was enacted to protect consumers' interests, providing a broad definition of 'service' to include various services, including telecom services.- Section 7B of the Telegraph Act provides for arbitration in disputes concerning telegraph lines, appliances, or apparatus between the telegraph authority and the beneficiary.5. Conflict of Laws:- The Consumer Protection Act 1986 is a special law enacted to protect consumers, whereas the Telegraph Act 1885 regulates telegraphs.- The Consumer Protection Act 2019 explicitly includes telecom services in its definition of 'service,' reinforcing the consumer forum's jurisdiction over such disputes.6. Judicial Precedents:- The Supreme Court in Emaar MGF Land Ltd. v. Aftab Singh held that an arbitration agreement does not oust the jurisdiction of the consumer forum.- The principle that the provisions of the Consumer Protection Act are in addition to other laws was reiterated, emphasizing that the availability of arbitration does not bar consumer complaints.7. Decision in M Krishnan Case:- The Supreme Court in M Krishnan v. General Manager, Telecom held that the special remedy under Section 7B of the Telegraph Act barred the remedy under the Consumer Protection Act.- This decision was found to be incorrect as it failed to recognize the Consumer Protection Act as a special law and did not consider Section 3, which states that remedies under the Act are in addition to other laws.8. Current Judgment:- The Supreme Court held that the existence of an arbitration remedy under Section 7B of the Telegraph Act does not oust the jurisdiction of the consumer forum.- The Consumer Protection Act 1986 and its successor, the Consumer Protection Act 2019, are subsequent enactments intended to protect consumers' interests.- The broad definition of 'service' under the Consumer Protection Act includes telecom services, and consumers can choose between arbitration and consumer forum remedies.9. Conclusion:- The Supreme Court affirmed the NCDRC's judgment, concluding that the District Forum has jurisdiction to entertain and try the complaint.- The appeal was dismissed, and pending applications were disposed of.Separate Judgments:- In Civil Appeal No 1389 of 2022 and Civil Appeal No 4274 of 2016, the Supreme Court set aside the NCDRC's judgments and restored the consumer complaints to the respective Consumer Disputes Redressal Forums.Summary:The Supreme Court held that Section 7B of the Indian Telegraph Act 1885 does not oust the jurisdiction of the consumer forum in disputes between telecom companies and consumers. The Consumer Protection Act 1986, which provides broad protection to consumers, includes telecom services within its ambit. The court emphasized that consumers have the option to choose between arbitration and the remedies provided under the Consumer Protection Act. The appeal was dismissed, affirming the NCDRC's decision that the consumer forum has jurisdiction over such disputes.