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SC Dismisses Pali Medicure Plea, Says Software Bought for Business Not a Consumer Deal
The Supreme Court held that the Consumer Protection Act does not apply to purchases made for profit. A bench of Justices J.B. Pardiwala and Manoj Mishra delivered this ruling on an appeal by M/s. Pali Medicure Limited. The Court held that a company purchasing software for commercial purposes cannot be considered a consumer. The Court upheld the findings of the State and National Consumer Disputes Redressal Commissions.
In a significant ruling, the Supreme Court said on Thursday that if a product or service is purchased for profit, the buyer cannot be considered a consumer. Hence, the buyer cannot pursue a case under the Consumer Protection Act.
While pronouncing the order on an appeal filed by M/s. Pali Medicure Limited, the bench comprising Justices J.B. Pardiwala and Manoj Mishra upheld the order passed by the State and National Consumer Disputes Redressal Commissions and said the complaint filed by the company was not maintainable under the Act.
It was held that a company purchasing software to conduct its business cannot be a consumer under the Consumer Protection Act, 1986, because it is a commercial transaction. Justice Mishra, while delivering the judgment, cited various judgments and stated that the purchase of goods/services (i.e., software) was related to profit-generating activities.
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Therefore, the petitioner cannot be considered a consumer as defined in the Consumer Protection Act based on that transaction. Dismissing the company's appeal, the court stated that if the transaction is related to profit, it would be considered a transaction for a commercial purpose.
The appeal was related to a complaint filed in 2019 by Pali Medicure Limited, a manufacturer and exporter of medical devices, before the Delhi State Consumer Disputes Redressal Commission. The company had alleged a deficiency in service against M/s Brillio Technologies Private Limited.
The company had purchased a software product license from M/s Brillio Technologies Private Limited to manage its export-import documentation system. Pali Medicure claimed that the software was not working properly despite full payment and demanded a refund of the license and costs, along with 18 percent interest.
However, the State Consumer Disputes Redressal Commission, in its order dated August 19, 2019, dismissed the complaint on the grounds that the company was not considered a consumer under the Consumer Protection Act, as the purchase was made for a commercial purpose. The National Consumer Disputes Redressal Commission upheld this decision in June 2020, following which the petitioner approached the Supreme Court.
