Not to deposit 50% amount for filing appeal under consumer law if disputes arose before 2019: SC

The Supreme Court Tuesday came to the rescue of those litigants, suffering award of compensation under the consumer law, saying they are not required to pay 50 per cent of the decretal amount for filing an appeal in appellate courts if the dispute arose before the 2019 Act came into being.

Under a provision of the Consumer Protection Act of 1986, if a litigant, against whom a money decree for compensation has been passed by a consumer forum, files an appeal then he will have to deposit either 50 per cent of the amount or Rs 50,000 which is less.

However, under the 2019 law on consumer protection, a litigant is required to deposit 50 per cent of the compensation amount as a prerequisite for filing an appeal in superior fora or the apex court.

A bench of justices Hemant Gupta and V Ramasubramanian was faced with a legal question whether an insurance company, which was asked by the National Consumer Disputes Redressal Commission (NCDRC) to pay Rs 265.01 crores compensation along with interest at the rate of 10 per cent in 2016, would be required to pay 50 per cent of the total decretal money under the 2019 law or will have to deposit of Rs 50,000 as mandated under the 1986 statute for filing the appeal in the top court.

The bench analysed the legal provisions of the 1986 and the 2019 consumer law and took note of judgements and the submissions of Attorney General K K Venugopal on the issue.

"In view of the binding precedents of the Constitution Bench judgements referred to above, we hold that the onerous condition of payment of 50 per cent of the amount awarded will not be applicable to the complaints filed prior to the commencement of the 2019 Act," the judgement said.

Writing the judgement, Justice Gupta took note of the submissions of the Attorney General that the appeal of ECGC Ltd (Export Credit Guarantee Corporation of India Ltd.) has been preferred under Section 23 of the 1986 Act and not under the 2019 Act which came into force from July 20, 2020.

"It was stated that the condition of deposit of 50 per cent of the amount is more onerous than what was provided under the 1986 Act. Therefore, keeping in view the principle that the law which is applicable at the time of initiation of the lis would be applicable, the provisions of the 1986 Act would govern the present appeal and not the provisions of the 2019 Act...Hence, the present appeal be heard on merits," the bench said referring to the submissions of the law officer.

ECGC Ltd was directed by the National Consumer Dispute Redressal Commission to pay a sum of Rs 265.01 Crores along with interest at the rate of 10 per cent from September 19, 2016, within three months to a firm.

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