NEW DELHI:
Supreme Court
on Wednesday used its Constitution-conferred omnibus powers under Article 142 to settle an unusual
15-year-old dispute
over a
BMW
7-Series car that was found to be defective after delivery and led to the buyer filing
cheating charges
against BMW India and its directors.
The car was purchased by a firm from a dealer in Hyderabad on Sept 25, 2009, but a serious defect was noticed while driving out the vehicle from the showroom to the owner's premises.
Though the car was repaired, the problem recurred three months later.
The frustrated buyer lodged a police complaint against BMW India, its managing director and other directors accusing them of cheating him with a
defective car
. BMW moved Telangana high court for quashing of the cheating FIR.
On Mar 23, 2012, HC quashed the prosecution against BMW and suo motu ordered the carmaker to replace the defective car with a new one. The Andhra Pradesh govt and the buyer moved the Supreme Court challenging the high court order. BMW accepted the high court judgment and agreed to replace the defective car with a new one. The buyer, however, did not accept the offer.
A bench of Chief Justice D Y Chandrachud and Justices J B Pardiwala expressed surprise at the HC judgment asking BMW to replace the defective car with a new one when the carmaker had only petitioned for quashing of the cheating case lodged against it by the buyer.
BMW India's counsel has offered to pay around Rs 30 lakh as compensation to the buyer now, saying a brand new 7-Series car costs more than Rs 1 crore at present and that the value of the used defective car would be around Rs 45 lakh. The car was purchased in 2009 for Rs 85 lakh.
SC noted that BMW had accepted the HC judgment and not moved SC challenging the HC order. The bench said while the HC order quashing the cheating case against BMW was legitimate, it resorted to its Article 142 powers to settle the old dispute and asked the carmaker to pay Rs 50 lakh as compensation to the buyer.
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