Company purchasing goods to automate business with a nexus to profit generation is not a "consumer"

Supreme Court Upholds Exclusion of Corporations from Consumer Definition in Software Purchase Case. M/s Poly Medicure Ltd. Disqualified as Consumer under Consumer Protection Act, 1986 for Software Purchase Aimed at Profit Maximization

In a significant ruling, the Supreme Court of India has held that M/s Poly Medicure Ltd., a corporation engaged in the import and export of medical devices, does not qualify as a "consumer" under the Consumer Protection Act, 1986, due to the commercial nature of its software purchase transaction. The judgment was delivered by Justices J.B. Pardiwala and Manoj Misra on November 13, 2025, in the appeal filed by M/s Poly Medicure Ltd. challenging the dismissal of its consumer complaint by both the State Consumer Disputes Redressal Commission, Delhi, and the National Consumer Disputes Redressal Commission, New Delhi.

The case revolved around the purchase of a software license for "Brillio Opti Suite" by M/s Poly Medicure Ltd., intended to automate its export/import documentation processes. The company claimed the software was defective and sought a refund for the license and additional development costs, along with interest. However, both lower forums dismissed the complaint, stating that the purchase was for a commercial purpose, thus disqualifying the company as a consumer under Section 2(1)(d) of the Consumer Protection Act, 1986.

In its judgment, the Supreme Court emphasized that the definition of "consumer" excludes transactions made for commercial purposes. It reiterated that the dominant intention behind a transaction is crucial in determining its commercial nature. The Court found that the purchase of the software had a direct nexus to profit generation, as it was intended to automate business processes and maximize efficiency and profits.

The judgment delved into the distinction between self-employed individuals, who may qualify as consumers if goods or services are purchased for livelihood purposes, and corporations, which typically aim to maximize profits. The Court further clarified that the transaction in question was not intended for self-employment but rather to enhance business operations for profit maximization, thereby falling within the commercial purpose exclusion.

This ruling reaffirms the understanding that business-to-business transactions, particularly those aimed at optimizing or expanding commercial activities, do not qualify under the consumer protection framework. The decision is expected to have wide implications for corporate entities seeking redress under consumer protection laws, reinforcing the importance of the dominant purpose behind transactions in determining consumer status.

Bottom Line:

Consumer Protection Act, 1986 - Incorporated company purchasing goods/services to automate business processes with a nexus to profit generation would not qualify as a "consumer" under Section 2(1)(d) of the Act, as the transaction is for a commercial purpose.

Statutory provision(s): Consumer Protection Act, 1986 Section 2(1)(d)

M/s Poly Medicure Ltd. v. M/s Brillio Technologies Pvt. Ltd., (SC) : Law Finder Doc Id # 2807662