New Delhi, February 11 The Supreme Court has reduced the compensation awarded to a woman from Rs 2 crore to Rs 25 lakh, for a "poor haircut" at a luxury hotel salon.
In a judgment delivered on February 6, a bench comprising Justices Rajesh Bindal and Manmohan held that while "deficiency in service" was established, compensation in consumer disputes must be based on "material evidence" and not merely the "claims" or "preferences" of the complainant.
"Damages cannot be awarded solely on the assumptions or preferences of the complainant. To establish a case for awarding damages, especially when the claim is in the crores, some reliable and credible evidence must be presented," Justice Bindal, who authored the 34-page judgment, said.
The verdict stated that this was not a case where the National Consumer Disputes Redressal Commission was considering a minor issue where compensation could be awarded based on a simple rule.
"The claim for compensation was for crores of rupees, and some loss suffered by the respondent due to the deficiency in service had to be established. This could not be proven simply by presenting photocopies of documents. Even the discrepancies in the photocopies produced by the respondent, as pointed out by the appellant, have been noticed. Thus, even after being sent back for further investigation, the respondent has not been able to prove the case for such a large compensation," it said.
The court held that while examining the photocopies of the documents, the apex consumer panel made an error in awarding a compensation of Rs 2 crore.
"The observation made by the Commission that, because the respondent suffered trauma, she may not have kept the original documents, hence reliance could be placed on photocopies, cannot be justified for awarding such a large compensation," the judgment read.
Even if the photocopies were presented, there are other ways to justify the claim based on them, it said.
"Even if the Code of Civil Procedure is not strictly applicable, the Commission has not assessed how the respondent suffered a loss of Rs 2,00,00,000/-. The general discussion in the impugned judgment may not justify this," it said.
In April 2018, Aashna Roy, a management professional, visited a salon at the ITC Maurya Hotel in Delhi.
Roy alleged that the stylist cut her hair much shorter than requested, causing her significant mental distress and the loss of lucrative modelling assignments and career opportunities.
The NCDRC initially awarded her Rs 2 crore in compensation.
After a previous round of litigation where the top court asked for a reassessment of the amount, the commission reiterated the Rs 2 crore award in April 2023.
ITC Limited challenged this second award before the apex court.