STATE OF ORISSA versus DIVISIONAL MANAGER, LIC AND ANR.

Citation: [1996] 3 S.C.R. 527 · Decided: 18-03-1996 · Supreme Court of India · Bench: K. RAMASWAMY, G.B. PATTANAIK · Disposal: Appeal(s) allowed

Judgment (excerpt)

t 
I 
STATE OF ORISSA 
A 
v. 
DIVISIONAL MANAGER, UC AND ANR. 
MARCH 18, 1996 
[K RAMASWAMY AND G.B. PATTANAIK, JJ.] 
B 
Consumer Protection Act, 1986 : Section 2( 1 )( o ). 
Consumer Protection-Se1vices excluded from the provisions of the 
Act-Se1vices free of charge or under a contract of peiwnal se1vice-Contract C 
of personal se1vice-Legal connotation of 
· 
Claim for compensation against State-Maintainability of-Respondent 
a Govemment servant filed a claim before State Commission-Damages 
awarded against L.l.C.-On appeal National Commission awarded damages 
against State-Appeal preferred by State-Held respondent being a Govem-
ment servant was bound by se1vice conditions and the State was rendering D 
se1vice free of charge to the contesting respondent-In the circunistances 
Govemmel!f servant has been excluded from the purview of the Act to claim 
damages against the State. 
Indian Medical Association v. V.P. Shantha & Ors., [1995] 6 SCC 651, 
referred to. 
CIVIL APPELLATE JURISDICTION : Civil Appeal No. 7092 of 
1996. 
E 
From the Judgment and Order dated 17.1.95 of the National Con-
sumer Disputes and Redressal Commission at Orissa in F.A. No. 510 of. F 
1992. 
V.A. Mohanty and C.S.S. Rao for the Appellants. 
P.P. Rao, S. Rajappa and KK Sharma for the Respondent. 
G 
Mrs. Sharda Devi for the Respondent No. 2. 
The following Order of the Court was delivered : 
This appeal is treated as special leave petitioner under Article 136 
of the Constitution. 
H 
527 
528 
SUPREME COURT REPORTS 
[1996] 3 S.C.R. 
A 
Leave granted. 
We have heard learned counsel on both sides. 
This appeal arises from the order dated February 17, 1995 in FA No. 
510 of 1992 of the National Consumer and Redressal Commission, New 
B 
Delhi. The respondent-Haribandhu Setha filed a claim before the State 
Commission, Orissa under the Consumer Protection Act, 1986 (for short, 
the 'Act') for damages. The State Commission awarded damages against 
the first respondent-UC. In appeal, the appellant was impleaded as party-
respondent and the National Forum awarded damages against the State in 
C a sum of Rs. 1,00,000 (Rupees one lakh only) and directed to pay compen-
sation within a period of three months. Thus, this appeal by special leave. 
D 
E 
The only question is : whether the appellant is liable to pay compen~ 
sation to Haribandhu Setha under the Act and whether the claim 1s 
maintainable. Section 2(l)(o) of the Act defines 'services' as under : 
"'services' means service of any description which is made available 
to potential users and includes the provision of facilities in con-
nection with banking, financing, insurance, transport, processing, 
supply of electrical or other energy, board of lading or both 
housing construction entertainment, amusement or the purveying 
of news or other informations; but does not include the rendering 
of any service free of charge or under a contract of personal service." 
(emphasis supplied) 
F 
A reading of the definition would indicate that the services con-
templated thereunder alone are the services within the meaning of the Act 
except excluded services mentioned thereunder. The excluded services are 
nservice free of charge or under a contract of personal service". The 
concept of contract of personal service was considered in a recent judg-
ment of this Court in Indian Medical Association v. V.P. Shantha & Ors., 
G 
(1995] 6 SCC 651. This Court had held therein that the expression "personal 
service" has a well known legal connotation and has been construed in the 
context of the right to seek enforcement of such a contract under the 
Specific Relief Act. For that purpose, a contract of personal service has 
been held to ccver a civil servant, the managing agents of a company and 
H a professor in the University. There can be a contract of personal service 
~ 
I 
; 
STATEv. DIVISIONAL MANAGER 
529 
if there is relationship of master and servant between a doctor and the A 
availing of his services and in that event the services rendered by the doctor 
to his employer would be excluded from the purview of the expression 
under Section 2(1)(o) of the Act by virtue of the exclusionary clause in the 
said definition. The other excluded service is service rendered free of 
charge. 
It is not in dispute that the respondent was a Government servant 
and, therefore, he is bound by the service conditions and the State was 
rendering services free of charge to the contesting respondent. Under those 
B 
. 

Excerpt shown. Read the full judgment & AI analysis in Lexace.