Manufacturing defect in car from day one entitles customer to a replacement or refund, not just repair: Jammu & Kashmir High Court

The Jammu and Kashmir and Ladakh High Court has ruled that a customer is entitled to replacement of vehicle or a full refund if the car suffers from a manufacturing defect from the very beginning.

Highlighting the distinction between repair for wear-and-tear issues and replacements for inherent manufacturing flaws Justices Sanjeev Kumar and Puneet Gupta observed,

“Repairs may be called for if the vehicles purchased during the course of its use suffers from a technical defect and not where the vehicle has manufacturing defect”.

Ramesh Chander Sharma, a resident of Jammu, purchased a Maruti 800 car from Pathankot Vehicleades Pvt. Ltd. Soon after the purchase, Sharma complained of technical problems in the vehicle. Despite repeated attempts to get the issue resolved, the dealership allegedly delayed a proper resolution. It was eventually determined that the car had a manufacturing defect in the engine.

Proceedings in the Consumer Forum

Sharma filed a consumer complaint before the Divisional Consumer Forum in Jammu, seeking replacement of the defective vehicle with a new one. The dealership and Maruti Udyog Limited contested the claim, arguing that the defect was minor and could be rectified through repairs.

The Forum, however, after examining the evidence, held that the car suffered from a manufacturing defect from the outset and therefore directed the dealership to either replace the vehicle or refund the purchase amount of Rs. 1,94,195.60 with interest at 9% per annum.

Maruti Suzuki assailed this order before the State Consumer Commission, which eventually dismissed the appeal for two reasons: it was filed beyond the limitation period, and it was not accompanied by the mandatory pre-deposit of 1/4th of the awarded amount.

High Court Judgement

Upholding the State Commission’s decision, the Court emphasised that the pre-deposit requirement is essential for filing an appeal and observed, “The pre-deposit within stipulated period along with appeal is sine qua non for entertaining an appeal by the Commissioner”.

Furthermore, the Court carefully examined the order passed by the Divisional Forum and found it legally sound. The Court distinguished between technical defects arising from wear and tear during use, which may require repairs, and manufacturing defects present from the very beginning.

The Court emphasized that a manufacturing defect renders the vehicle unfit for its intended purpose and necessitates replacement, not repairs. It thus dismissed Maruti Suzuki’s appeal stating that there were no legal grounds for interference.

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