Mercedes-Benz Ordered to Refund ₹1.78 Crore for Defective Car: A Landmark in Consumer Justice

The Delhi State Consumer Disputes Redressal Commission (SCDRC) has delivered a landmark ruling, directing Mercedes-Benz India to refund over ₹1.78 crore to a buyer after repeated manufacturing defects were found in its premium EQS580 electric car. This case not only highlights accountability in the luxury automobile sector but also demonstrates the strength of the Consumer Protection Act, 2019 in safeguarding consumer rights in India.

The Case: When Luxury Turns into Liability

In November 2022, Gurvinder Khurana, director of Samran Media Consultants Pvt Ltd, purchased a Mercedes-Benz EQS580 for approximately ₹1.55 crore. Within just six months and 9,000 km of use, the car began showing serious issues:

• Tyre bulging

• Sudden stoppage while driving

• Radar sensor failure

• Malfunctioning vehicle sensors

• Humming noise from AC blower

Despite multiple service visits, the problems persisted. Adding to the consumer’s woes, Mercedes-Benz withdrew the EQS580 model from the Indian market, leaving no scope for replacement.

(Source: The Indian Express, Sept 19, 2025)

Mercedes-Benz’s Defence — and the Commission’s Findings

Mercedes-Benz attempted to defend itself on three grounds:

1. Not a “consumer”: The company claimed the vehicle was purchased for commercial use.

2. No expert evidence: They argued that the complainant had not provided technical reports proving a defect.

3. Jurisdiction challenge: They claimed Delhi SCDRC lacked territorial jurisdiction.

The Commission dismissed all these objections, holding that:

• The complainant qualified as a consumer under Section 2(7) of the Consumer Protection Act, 2019, since the car was bought for personal use.

• Persistent defects soon after purchase indicated an inherent manufacturing defect.

• Jurisdiction was valid because the car was purchased and registered in Delhi.

The Order: Full Refund + Compensation

The SCDRC declared the EQS580 “defective since inception” and ordered Mercedes-Benz to:

• Refund the entire purchase price of ₹1.55 crore

• Reimburse insurance and road tax (~₹3.1 lakh)

• Repay Tax Collected at Source (~₹1.55 lakh)

• Compensate for loan interest (~₹16 lakh)

• Pay ₹5 lakh for mental agony

• Cover ₹50,000 as litigation costs

Total relief: approximately ₹1.78 crore.

(Source: The Indian Express)

Why This Case Matters

This ruling sends a clear message: no manufacturer, regardless of brand value, is above consumer law.

• Broader scope of protection: Even luxury goods and high-value purchases fall within consumer rights.

• Stronger remedies: Courts are empowered to order refunds (not just repairs) when defects persist.

• EV reliability under scrutiny: With the growing EV market, manufacturers must ensure sensor reliability, software stability, and robust after-sales service.

How Consumers Can Take Action

If you buy a defective product — whether a car, appliance, or financial service — here’s how you can fight back:

1. Preserve documentation – Keep receipts, warranty cards, emails, and service records.

2. First contact the company – Give them a fair chance to repair or replace.

3. Issue a legal notice – If unresolved, a formal advocate’s notice builds pressure.

4. Approach Consumer Commissions under the Consumer Protection Act, 2019:

   • District Commission – for claims up to ₹50 lakh

   • State Commission – for claims between ₹50 lakh and ₹2 crore

   • National Commission – for claims above ₹2 crore

5. Seek remedies such as refund, replacement, repair, compensation for mental agony, and litigation costs.

Why Legal Guidance is Critical

Big corporations often contest consumer claims with procedural defences — just as Mercedes-Benz did. Having an experienced legal advisor ensures:

• Proper drafting of notices and complaints

• Strong documentary and legal evidence

• Representation before consumer forums and appellate bodies

• Maximization of compensation and relief

As an advocate specializing in consumer rights and public health law, I assist clients in pursuing such claims effectively and strategically.

Final Thoughts

The Mercedes-Benz case demonstrates the power of consumer law in India. If a ₹1.55 crore luxury car can be refunded for persistent defects, then every consumer — regardless of the product’s value — has the right to demand accountability.

Justice is not reserved for the wealthy; it is a right for every consumer.

📌 Disclaimer: This blog post is for informational purposes only and does not constitute legal advice. For specific guidance, please consult a qualified legal professional.

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👉 If you or someone you know is facing issues with defective products, unfair trade practices, or denial of consumer rights, feel free to reach out for legal consultation. Justice is not just for the big cases — it’s for every consumer.

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