3 weeks ago
Commission orders pizza franchisor to refund Rs 3 lakh
A man named Sudhir wanted to open his own pizza shop.
He gave a pizza company a lot of money to start a franchise.
But soon after, the government said it needed the shop's space to build a wider highway.
Because of that, his pizza shop could not open.
The man asked the company many times to give his money back.
The company refused.
So the man went to a special court that helps people who pay for things.
The court said the company was not being fair and must return all the money.
It also told the company to pay extra money for the trouble it caused.
This teaches us that companies cannot keep your money if they cannot do what they promised.
The Kangra District Consumer Disputes Redressal Commission ordered two pizza franchisor companies to refund Rs 3 lakh booking money to franchisee Sudhir Kumar.
The proposed outlet at Shop Number 17, New Kartar Market in Shahpur, Kangra, became impossible to start after NHAI acquired the premises in October 2024 for the four-laning of National Highway 154.
Kumar paid the booking amount in three instalments after receiving a Letter of Intent on September 11, 2024, and was later asked to pay Rs 15,82,635 in commercial setup charges.
The commission ruled that refusing the refund was deficiency in service and an unfair trade practice, and that retaining the money amounted to unjust enrichment.
The companies, which did not appear despite notice, must pay 9 per cent annual interest on the refund, Rs 30,000 compensation and Rs 7,500 litigation costs.
- Who
- Sudhir Kumar, a Kangra resident, who filed a consumer complaint against two pizza franchisor companies including Neo Palates Private Limited; the order was passed by the Kangra District Consumer Disputes Redressal Commission.
- What
- The commission ordered the pizza franchisor companies to refund Rs 3 lakh booking money with interest, plus compensation and litigation costs, after NHAI acquired the proposed franchise site.
- Where
- Kangra district, Himachal Pradesh, India — the proposed outlet was at Shop Number 17, New Kartar Market, Shahpur, and the site was acquired for the National Highway 154 expansion.
- When
- The complaint was filed on May 27, 2025, heard on July 6, 2026, and decided on July 20, 2026.
- Why
- The franchise agreement became impossible to perform after NHAI acquired the premises for highway expansion; the commission held that retaining the booking amount amounted to unjust enrichment, deficiency in service and unfair trade practice.
Key facts
- Complainant
- Sudhir Kumar, an unemployed Kangra resident
- Respondents
- Neo Palates Private Limited and another pizza franchise company
- Booking amount
- Rs 3 lakh, paid in three instalments after a Letter of Intent dated September 11, 2024
- Reason for dispute
- NHAI acquired the proposed premises in October 2024 for four-laning of National Highway 154
- Order
- Refund of Rs 3 lakh with 9% annual interest from date of complaint filing, Rs 30,000 compensation and Rs 7,500 litigation costs
- Order date
- July 20, 2026
- Legal basis
- Sections 56 and 65 of the Indian Contract Act, 1872 — contract void due to impossibility of performance
- Commission
- Kangra District Consumer Disputes Redressal Commission, Himachal Pradesh
Quotes
Himachal Pradesh Consumer Disputes Redressal Commission
Commission body presiding over the case
“The retention of the Complainant’s hard-earned money under these circumstances amounts to unjust enrichment”
indianexpress.com
Sources
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