1. The State Commission, Delhi, by its order dated 10-3-2006 in Appeal No. 1815 of 2000 held that the services rendered by the Lawyer would not come within the ambit of Section 2(1)(o) of the Consumer Protection Act, 1986, as the client executes the power of attorney authorizing the Counsel to do certain acts on his behalf and there is no term of contract as to the liability of the lawyer in case he fails to do any such act. The State Commission further observed that it is a unilateral contract executed by the client giving authority to the lawyer to appear and represent the matter on his behalf without any specific assurance or undertaking.
2. Against the aforesaid order the Complainant had preferred the Revision Petition before the National Consumer Disputes Redressal Commission, New Delhi. The National Consumer Disputes Redressal Commission, New Delhi vide their Revision Petition No. 1392 of 2006 dated 6th August, 2007 has held that “In our view, the reasoning given by the State Commission is totally erroneous. The ambit and scope of Section 2(1)(o) of the Consumer Protection Act which defines ‘service’ is very wide and by this time well established, it covers all services except rendering of services free of charge or a contract of personal service. Undisputedly, lawyers are rendering service. They are charging fees. It is not a contract of personal service. Therefore, there is no reason to hold that they are not covered by the provisions of the Consumer Protection Act, 1986.”
3. The Commission has also observed that the importance of the Act lies in promoting welfare of the society inasmuch as it attempts to remove the helplessness of a consumer as he faces against powerful business; “producers have secured power” to “rob the rest”. The might of public bodies which are degenerating into storehouses of inaction where papers do not move from one desk to another as a matter of duty and responsibility but for extraneous consideration leaving the common man helpless and shocked.
4. Now it is beyond reasonable doubt that, if there is deficiency in service rendered by the Lawyers or Chartered Accountants, complaint under the Consumer Protection Act, 1986 may be maintainable.
5. As the law is settled, the professionals must be extra cautious while giving opinion, advising, signing audit report etc. In spite of taking all the precautions, it may be still possible that some of the assessees may take an action due to some vested interest. We are of the opinion that to meet such an eventuality it may be desirable to take an appropriate professional indemnity insurance, so that the monetary claim and cost of litigation can be taken care. It may be possible that, if 100 professionals join together and negotiate with insurance company the insurance premium for professional indemnity may be very low.
A thought for debate and consideration in the interest of the members of the Federation. Members may e-mail their thoughts to the office of the Federation for an appropriate decision.
Dr. K. SHIVARAM