THE LAW SAYS SO – CA SEP 14
- Posted by CERC India
- Posted in Uncategorized
Can an appellate authority grant conditional stay?
The Consumer Protection Act requires a party challenging an order in appeal to deposit a prescribed amount at the time of lodging the appeal. In the case of appeals to the National Commission, this amount is 50% of the amount awarded or Rs. 35,000, whichever is lower. Can the appellate authority direct the appellant to deposit further money to grant conditional stay? Yes, ruled the Supreme Court recently in a case involving Shreenath Corporation and CERS.
A building constructed by the corporation collapsed due to poor quality of construction causing deaths and injuries. CERS filed a complaint on behalf of the victims following which the Gujarat State Commission directed the builder to pay compensation ranging from Rs. 1.5 lakh to Rs. 18.6 lakh. The builder appealed to the National Commission and deposited Rs. 35,000 per appeal. He also applied for an interim stay on the enforcement of the State Commission’s order pending the appeal. The National Commission granted conditional stay subject to the builder depositing 50% of the principal amount awarded.
The builder challenged this ruling before the Supreme Court which upheld the National Commission’s order. It observed that the deposit of Rs. 35,000 is a ‘pre-deposit’, the objective of which is to avoid frivolous appeals. The Commission had the power to pass interim orders, exercising its discretion depending on the merits of the appeal.
