Actor Mohanlal not liable for endorsing advertisement of finance firm

The Kerala High Court has held that actor Mohanlal cannot be held liable in a consumer case in which a private finance company allegedly demanded higher interest rate than what it had advertised.

The court ruled that the actor cannot be held liable for consumer complaints against Manappuram Finance simply for endorsing it, despite allegations of the firm charging higher interest rates for gold loans than advertised.

The actor had approached the High Court, challenging the orders passed by the Thiruvananthapuram district and the State-level consumer disputes redressal commissions that had rejected his pleas on the maintainability of the complaints. The complainants claimed they were drawn to the interest rate offer after seeing the advertisement featuring Mr. Mohanlal as the brand ambassador.

The manager of the lending firm reportedly asked for an increased interest rate when the complainants sought to close their loan account and retrieve the gold. They then approached the consumer dispute commissions, alleging deficiency in service and unfair trade practise, seeking a refund of the excess interest collected and ₹25 lakh compensation for mental agony.

Both the district and the State consumer commissions held that the complaint was maintainable, and relied on the definition of ‘endorsement’ in the Consumer Protection Act, 2019.

While considering the actor’s plea, the court observed that liability can be imposed on an endorser only if a direct link was established between the person who is availing a service, and those who are impleaded as opposite parties in the complaint as service providers or suppliers of equipment. It went on to quash the orders passed by the consumer bodies against the actor, and added that the alleged failure to honour the promised interest rate could only be attributed to the service provider. The court made it clear that the complainants are free to invoke remedy before the competent authority under Section 21 of the Act.