Defect in new car? Seek total refund

Pushpa Girimaji

Q: I bought an expensive new car in October this year. Four days later, while we had just started off on a vacation, the car suddenly stopped and indicated that the engine was heating up dangerously. We had to cancel our trip and take the car to the workshop where I was told that due to the breakdown of some part, the supply of water and coolant had stopped. Meanwhile, there are some other problems too and require change of parts. The company is promising to do it, but I now want a refund. What do I do?

I can well understand your sentiments. When one buys a new car, one expects it to be in perfect condition. However, to ensure this, the manufacturer has to check the vehicle thoroughly before it leaves the manufacturing unit. Obviously, this has not been done. I would consider this as a major deficiency on the part of the manufacturer and he must be held accountable for this as much as for the defects in the vehicle. So, write a letter to the manufacturer and the dealer and tell them that you have lost faith in the model that you purchased because of the defects that you encountered from the very beginning and, therefore, you want them to refund the cost of the vehicle.

Manufacturers in India are most reluctant to refund the cost because of weak laws in this regard, but you must fight it out. Write to the department of transport, government of India as well as the union ministry of consumer affairs and ask them to take it up with the manufacturer. If the manufacturer does not respond positively, you will have to go to the consumer court. So keep a record of the problems you have encountered and the repair work done on the car. If possible, try and get the opinion of an automobile expert too. That would strengthen your case.

I would also urge you to check if any other consumers who bought this model have had similar problems. You can do so by checking on the consumer complaint websites. You can also send out a request to all those who have had similar problems with the vehicle, to join you in your fight for refund. Use the social media for this. This will strengthen the case for a refund to all the consumers and may even lead to a recall, if there are more consumers.

I must also tell you that the amendment to the Motor Vehicles Act , which is before the Parliament now, provides for recall of vehicles found to be defective. Depending on the seriousness of the defect, the manufacturer will be asked to replace the parts or replace the entire vehicle or refund the cost of the vehicle and also pay a fine. We did not have a law for such recall of defective vehicles and this is a very welcome step.

Have there been some good case laws vis-à-vis the consumer courts on this issue? Can you quote them?

There are a number of orders of the apex consumer court, but for want of space, I will quote just three here:

In Scooters India Limited Vs Madhabananda Mohanty (RP no 240 of 2002, order dated February 7, 2003), the National Consumer Disputes Redressal Commission made the following points: (a) If a vehicle is defective, a consumer has the right to seek its replacement or refund of the price. However, it must be shown that the use of the vehicle has been substantially impaired on account of the defects. On the other hand, if the defects are insignificant, it could not be a case for replacement or refund.

In Vinoo Bhagat Vs General Motors (FA No 150 of 1998, order dated Jan 30, 2003), the apex consumer court put two conditions for ordering refund or replacement: (a) the car is defective and its use is substantially impaired and (b) the manufacturer/dealer fails to rectify the defect despite reasonable opportunity given for it.

In M/S Hyundai Motors India Vs M/S Affiliated East West Press (Revision petition no 958 of 2007, decided on November 29, 2007), the Commission held that where a consumer experiences problems with a vehicle just a couple of months from the date of purchase, and the manufacturer is unable to rectify them, even if those problems are not major, the manufacturer has to give a replacement or a refund.