Kochi: The Kerala High Court has absolved actor Mohanlal of liability in a consumer dispute alleging unfair trade practice by Manappuram Finance for charging interest higher than what was advertised.

Justice Ziyad Rahman A A held that liability could not be fastened on the actor as he was only the brand ambassador of the company and had not directly persuaded consumers to avail its services.

Mohanlal had approached the High Court challenging orders of the District and State Consumer Dispute Redressal Commissions, which had rejected his plea questioning the maintainability of a consumer complaint filed against him.

The complaint was filed by borrowers who said they had initially pledged gold ornaments with Catholic Syrian Bank at an interest rate of 15 per cent per annum. They later shifted the loan to Manappuram Finance after being promised a lower rate. The complainants claimed they were influenced by advertisements featuring Mohanlal.

However, when they sought to close the loan and retrieve the gold, Manappuram allegedly demanded a higher interest rate than what was advertised. Alleging deficiency in service and unfair trade practice, the complainants sought a refund of the excess interest collected and compensation of ₹25 lakh.

Before the district commission, Mohanlal contended that he had no direct role in the transaction and could not be held responsible for any alleged deficiency of service or unfair trade practice. He also challenged the maintainability of the complaint against him.

The district commission, relying on the definition of ‘endorsement’ under Section 2(18) of the Consumer Protection Act, 2019, held the complaint to be maintainable. The State Commission, in revision, declined to give a specific finding on maintainability, prompting the actor to approach the High Court.

Examining the provisions of the Act, the High Court noted that the term ‘endorser’ finds specific mention only under Section 21, which empowers the Central Authority to impose penalties in cases of false or misleading advertisements. The court pointed out that even under this provision, an endorser is exempt from penalty if due diligence has been exercised to verify the claims made in the advertisement.

The court observed that liability for deficiency of service or unfair trade practice could be imposed on an endorser only if a direct link was established between the endorser and the consumer availing the service.

On examining the complaint, the court found that Mohanlal was referred to only as the brand ambassador and that the assurance regarding interest rates was allegedly given by Manappuram’s manager by citing the advertisements. This, the court said, did not establish any direct link between the complainants and the actor.

Accordingly, the High Court quashed the orders of the consumer commissions and held that the complaint was not maintainable against Mohanlal. It, however, clarified that the complainants were free to pursue remedies available under Section 21 of the Consumer Protection Act.
(With LiveLaw inputs.)