Page 257 - DMGT306_MERCANTILE_LAWS_II

Mercantile Laws – II

Notes
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Caselet The Indian Merchants Association’s Case

he Supreme Court in the case of Indian Merchants Association v. V P Santha, (CA
No. 688 of 1993 decided on 13th November 1995) observed that a contract for
Tservice implies a contract whereby one party undertakes to render services e.g.
professional or technical services to or for another in the performance of which he is not
subject to detailed direction and control but exercises professional or technical skill and
uses his own knowledge and discretion. A contract of service on the other hand implies
relationship of master and servant and involves an obligation to obey orders in the work
to be performed and as to its mode and manner of performance. The Parliamentary
draftsman was well aware of this well-accepted distinction between ‘contract of service’
and ‘contract for services’ and had deliberately chosen the expression ‘contract of service’
instead of the expression ‘contract for service’ in the exclusionary part of the definition of
‘service’, this being the reason being that an employer could not be regarded as a consumer
in respect of the services rendered by his employee in pursuance of contract of employment.
By affixing the adjective ‘personal’ to the word ‘service’ the nature of the contracts which
were excluded were not altered. The adjective only emphasized that what was sought to
be excluded was personal service only. The expression contract of personal service in the
exclusionary part of Section 2(1)(o) must, therefore, be construed as excluding the services
rendered by an employee to his employer under the contract of personal service free from
the ambit of the expression service.
Source: http://www.labourguide.co. /consumer-protection-act/

Service Rendered under Medicare Insurance Scheme

Service rendered by a medical practitioner or hospital/nursing home cannot be regarded as
service rendered free of charge, if the person availing the service has taken an insurance policy
for medical care where under the charges for consultation, diagnosis and medical treatment are
borne by the insurance company and such service would fall within the ambit of service as
defined in Section 2(1)(o). Similarly, where as a part of the conditions of service, the employer
bears the expenses of medical treatment of an employee and his family members dependent on
him, service rendered to such an employee and his family members would not be free of charge
and would constitute service under Section 2(1)(o) of the Act.

In State of Haryana v. Santra [2000(3) SCALE 417], the Supreme Court held that in a country where
the population has been increasing rapidly and the Government has taken up the family planning
as an important programme, the medical officer as also the State Government must be held
responsible in damages if the family planning operation is a failure on account of the medical
officers negligence because this has created additional burden on the parents of the child.
In the case of Alex J. Rebello v. Vice Chancellor, Bangalore University and others, 2003 CTJ 575 (CP)
(NCDRC) the National Commission has held that the University in conducting examination,
evaluating answer sheets and publishing the result was not performing any service for
consideration and a candidate who appeared for the examination cannot be regarded as a
consumer.
Consumer Dispute means a dispute where the person against whom a complaint has been made,
denies or disputes the allegation contained in the complaint [Section 2(1)(e)].

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