The Supreme Court on Tuesday held that the National Consumer Disputes Redressal Commission (NCDRC) can direct the deposit of the entire amount or more than 50 percent determined by the state commission for conditional stay.
A bench of Justices M.R. Shah and B.V. Nagarathna said: "Pre-deposit of 50 per cent of amount as ordered by the state commission under second proviso to Section 51 of the Consumer Protection Act, 2019 is mandatory for entertainment of an appeal by the national commission."
It pointed out that the object of the pre-deposit condition is to avoid frivolous appeals.
"The said pre-deposit condition has no nexus with the grant of stay by the national commission. while considering the stay application in staying the order passed by the state commission, the national commission can grant a conditional stay directing the appellant(s) to deposit the entire amount and/or any amount higher than 50 per cent of the amount in terms of the order of the state commission," the bench said.
The top court's ruling came in a case involving the interpretation of Section 51 of the Consumer Protection Act 2019, which prescribes pre-deposit for filing appeal before the NCDRC.
The top court framed a question to examine: "Whether the national commission can pass an order to deposit the entire amount and/or any amount higher than the 50 per cent of the amount in terms of the order of the state commission while entertaining the appeal in view of Section 51 of the Consumer Protection Act, 2019."
It concluded: "The national commission has to assign some cogent reasons and/or pass a speaking order when the conditional stay of the order passed by the state commission is passed subject to deposit of the entire amount and/or any amount higher than 50 per cent of the amount either as an ex parte order or after hearing both sides and considering the facts and circumstances of the case."
Section 51 of the Consumer Protection Act, 2019 provides that no appeal by a person, who is required to pay any amount in terms of order of the state commission shall be entertained by the national commission unless the appellant has deposited 50 percent of that amount in the manner as may be prescribed.
The top court judgment came on the appeals filed by a group of builders aggrieved by the direction of the NCDRC to deposit the entire decretal amount determined by the state commission for conditional stay. The bench said: "The national commission can grant a conditional stay of the order passed by the state commission on deposit of the entire amount and/or any amount higher than 50 per cent of the amount as ordered by the state commission in the aforesaid manner."
One of the petitioner's counsel argued Section 51 imposed a statutory limit that the pre-deposit amount cannot be higher than 50 percent of the decretal amount.
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