Deficiency of Service : With reference to Contract of and Contract for Service

Deficiency of Service

Deficiency of Service is one of the biggest hindrances to consumers that the Consumer Protection Act intends to overcome. For this purpose, the Consumer Protection Act, 1986 defines the words “service” and “deficiency”. Hence, we must first understand the meaning and concept of service and deficiency.

What is a Service?

A service refers to an intangible benefit received by the consumer from the service provider for a considerable amount. Intangible is something that cannot be touched or seen but can be felt.


A pays B Rs. 500 for providing him career counselling.

Here, A is the consumer,

B is the service provider

Career counselling is the service and

Rs 500 is the consideration amount.

Section 2(1)(o) of the Consumer Protection Act, 1986 defines service and gives the ambit of service. Service, according to this definition, includes banking, financing, insurance, transport, processing and so on.

However, service excludes services rendered free of charge or under a contract of personal service. The concept of Contract of Service and Contract for Service will be discussed further in the article.

What is a Deficiency?

Section 2(1)(g) of the Consumer Protection Act, 1986 defines deficiency. According to this definition, any fault, shortcomings, inadequacy, and imperfection in the quality, nature or manner of performance of the service is a deficiency. This standard has to be maintained by or under any law for the time being in force.

Hence, if any service is not up to the mark or is flawed, that is, does not meet the mark of the laws applicable in the particular period, it is deficient.


If a hospital refuses to provide or suspends medical services to an injured person at his deathbed, the hospital’s services will be deficient according to the aforementioned section.

This illustration has been seen in Pravat Kumar Mukherjee v. Ruby General Hospital &Ors[1].

Deficiency of Service:

Deficiency of Service sprawls across various fields like medicine, construction, transport and so on. Deficiency in service often causes inconvenience, injury and in aggravated cases, death. Services are to be provided by immensely equipped individuals with utmost proficiency. If services are not provided with care, severe damage can be caused to the receiver. This damage includes physical, mental and economic loss.

Cases of deficiency of service are rampant in India due to inefficiency and negligence. The Consumer Protection Act is a way to penalise curb this lax behaviour and curb negligent activities in future. It is the much-required means of providing justice to those consumers who have been at a loss or inconvenience.

The field of medicine has seen the most complaints, ranging from Ayesha Begum v. All India Institute of Medical Sciences[2] to the famous Indian Medical Association v. V.P. Shantha[3]. The former dealt with a wrong diagnosis leading to economic loss and physical weakness, while the latter argued upon the distinction of the contract of service and contract for service. Other cases in this field include Gulam Abdul Hussain vKatta Pullaiah Choudhary[4] and Consumer Unity and Trust Society Vs. State of Rajasthan[5].

The field of construction to has seen cases of deficiency of service, as noted in the case, Lucknow Development Authority v. M.K. Gupta[6]. The field of tailoring involves A.C. Monday v. Cross Well Tailor And Anr.[7]

These cases are the various instances where the Indian law rightly intervened and redressed the consumers. It poses as a strong deterrent to all those service providers who indulge in fraudulent or negligent means of operation.

Contract of Service of Contract for Service:

As clearly mentioned in the definition of service, a contract of service is excluded from service. But what does this term actually mean? The concepts are as follows:

A Contract of Service involves an employer and an employee, similar to a master-servant relationship. All the actions of the employee are monitored, controlled and regulated by the employer. The employee acts on the directions of the employer, hence he is told what task to do and precisely how to do it.Hence, the employee is not personally liable for the acts done by him. The employee can be hired and fired at any time, on the discretion of the employer. The acts of an employee arising out of a contract of service is not a service and hence cannot be deficient.


A master cannot claim compensation from his butler as the employment contract is that of service.

A Contract for Service, on the other hand, is more of a contractor and client relationship. Contractor acts on the basis of his own skill and expertise and is independent. He is not bound to the client as to how to perform a particular task that the agent wants to be done.His services can be deficient and he can be held responsible for it. He is hence the renderer of services, liable for providing compensation to the disadvantaged.


A tailor will be liable to compensate a customer if his stitching is imperfect as the contract entered into is that for service.

This illustration is derived from the aforesaid case A.C. Monday v. Cross Well Tailor And Anr.[7] where the major contention from side respondent was ruled out. His argument of his tailoring service being a contract of service was held invalid, thus distinguishing the two terms.

These are the concepts Contract of Service and Contract for Service.

The consumers of the country today are in dire need of protection from services that are not up to the mark. The Consumer Protection Act, 1986, effectively tries to safeguard the interests of the consumers.

 Edited by – Sakshi Agarwal

Quality Check – Ankita Jha

Approved & Published by –  Sakshi Raje


[1] AIR 2007 Cal 77

 [2] ILR 2003 KAR 4255

[3] 1996 AIR 550

[4] 1991 (1) CPR 499

[5] 1991 (1) CPR 241 (NC)

[6] 1994 AIR 787

[7] (199l)2 C.P.J. 586(N.C.)

Sonika Sekhar
I am Sonika Sekhar from National Law University and Judicial Academy, Assam. I have a keen interest in reading and writing, which stems from my fascination for the English language. Having done debates and moots in the past, articulation is of great importance to me. I have studied Civil Law and Consumer Protection Law in detail, along with some aspects of Criminal Law.