The Supreme Court, recently, has held that Farmer Entering Into Buyback Agreement With Seed Company Is A ‘Consumer’. The fact that there was a buyback agreement for the musli crop would not bring the Respondent outside the purview of the definition of “consumer” by rendering the buyback arrangement a resale transaction or being for a commercial purpose.
The judgement came out in a case titled as M/S NANDAN BIOMATRIX LTD. vs. S. AMBIKA DEVI & ORS.
CASE BACKGROUND
In the Present case, Respondent entered into a tripartite agreement with the Appellant. As per the agreement, the Respondent purchased 750 kgs of wet musli for sowing from the Appellant, at the rate of L 400/- per kg, and cultivated the same in her land. The Appellant was to buy back the produce at a minimum price of L 1,000/- per kg from the Respondent. The Respondent lodged a consumer complaint alleging negligence and breach of contract on the part of the Appellant on the ground that the Appellant failed to buy back her produce, leading to the destruction of the greater part of the crop.
The District Forum dismissed the complaint, and held that the same was not maintainable since the Respondent was not a “consumer” within the meaning of the Consumer Protection Act, 1986 (“the 1986 Act”). On appeal, the State Commission set aside the order passed by the District Forum, holding that the Respondent was a “consumer” under the 1986 Act, and remanded the matter to the District Forum for disposal on merits. It is this order which was impugned before the National Commission by way of a revision petition filed by the Appellant.The National Commission upheld the finding of the State Commission, and dismissed the Revision Petition with a cost of L 2,500/- imposed on the Appellant, payable to the Respondent.
It was argued by the Appellant that the tripartite agreement envisaged buyback of musli by the Respondent from the Appellant, which amounted to resale, which is excluded from the purview of Section 2(d). Secondly, it was argued that the cultivation and sale of musli by the Respondent was for a commercial purpose and not for the purpose of earning livelihood, and hence excluded from the purview of Section 2(d).
The Apex court while rejecting the contentions of the Appellant has held:
In matters such as the one on hand, the agriculturist buys the foundation seeds from the seed company, or the company itself reaches out and requests the farmers to generate the seeds so that it may market the same. By accepting such an offer, and after purchasing the foundation seeds from the seed company, the agriculturist, with hard labour and sweat, produces seeds to be marketed by the seed company. Thus, the agriculturist is not reselling any product, but grows his own product by utilizing the foundation seeds. There cannot be any dispute that the agriculturist has to sell his product in the open market or to the seed company, as the case may be, in order to eke out his livelihood. In other words, the agriculturist sustains himself by selling his product. This cannot be termed as resale or activity in furtherance of a “commercial purpose” bringing him out of the purview of the definition of “consumer” under Section 2(d). Rather, it is purely for the purpose of earning his livelihood by means of self-employment.
The fact that there was a buyback agreement for the musli crop would not bring the Respondent outside the purview of the definition of “consumer” by rendering the buyback arrangement a resale transaction or being for a commercial purpose.
Thus, the Apex Court dismissed the instant Appeal and directed the concerned District Forum to hear and decide the complaints within a period of three months from the date of receipt of this judgment.it Further imposed a costs on the Appellant to the tune of L 25,000/- payable to the Respondent.
Read Judgement Here:
