PRESIDENT, DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, SAMBALPUR
Consumer Complaint No.-102/2023
Present-Dr. Ramakanta Satapathy, President,
Sri. SadanandaTripathy, Member,
Sonu Agrawal, Aged about 40 years,
S/O-Late Sawarmal Agrawal,
R/O- Near DivyaJyotiAashram, Durga Mangalam, Po/Ps-Khetrajpur,
Dist-Sambalpur-768003, Odisha .……….......Complainant.
Vrs.
- The Branch Manager, State Bank of India,
Sambalpur Bazar Branch, Sambalpur-768001.
- ShyamCharanBhoi,
S/O-DileswarBhoi, At-Kainsir Road, PO/Ps-Ainthapali,
Counsels:-
- For the Complainant :- Sri. Sureswar Mishra & Associates
- For the O.P.No.1 :- Sri. B.Meher & Associates
- For the O.P.No.2 :- Ex-parte
Date of Filing:19.06.2023, Date of Hearing :23.07.2024, Date of Judgement :17.09.2024
Presented by Dr. Ramakanta Satapathy, PRESIDENT
- The case of the Complainant is that the O.P.No.1 was appointed as transport contractor by the Indian Oil Corp. Ltd (IOCL) and the Complainant has oil tankers obtained on loan basis for self employment. The Complainant engaged the oil tanker as working partner and agreement was made accordingly.
Complainant was having a term Deposit of Rs. 1,80,000/- on 10.09.2015 for a period of 6 years and maturity date was 10.09.2021 having maturity value of Rs. 2,77,012/-.
Amongst four working partners against Bank Guarantee of Rs. 7,20,000/- obtained by O.P.No.2, from O.P.No.1 Rs. 1,80,000 taken as security in favour of IOCL. The Bank guarantee was valid till 30.03.2021.
In 2017 the Complainant withdrew all his tank trucks from partnership. The O.P.No.1 was intimated. As against Bank Guarantee the O.P.No.2 had obtained Demand Promisory Note of Rs. 1,80,000/- from the Complainant and had furnished it before the O.P.No.1 Bank.
After withdrawal from partnership the O.P.No.2 was requested to return the D.P.Note but the O.P.No.2 requested to bear with him to receive the maturity value. On good faith the O.P.No.2 was not insisted for return.
On 29.12.2022 the Complainant got SMS message from O.P.No.1 that the entire amount of Rs. 1,80,000/- was deducted for Bank guarantee and balance amount was credited in the S.B. Account. The Complainant raised a protest before O.P.No.1 that after renewed. The deduction of Rs. 1,80,000/- is unauthorised and without the consent of Complainant after expiry of Bank Guarantee. The O.P.No.1 remained silent. Written protest was given to O.P.No.2 but it was returned unserved. Again through mail it was delivered on 31.12.2022. An advocate notice was also given to O.Ps through Sri. A. Meher but it was invain.
A new Bank Guarantee No. 0730721BG0000008 was allowed by O.P.No.1 without taking signature of the Complainant and B.G. No. 3/2015 was renewed for a period for 6 month and after expiry of 6 months renewed the Bank Guarantee without knowledge and consent of the Complainant. Before adjustment also no any notice has been served.
The acts of the O.Ps are unfair trade practice and deceptive practice, and deficiency in service.
Being aggrieved this complaint is filed.
- The O.P.No.1 Bank submitted that the Complainant admitted that he has purchased several transport vehicles from different finance companies in 2015. The O.P.No.2 was engaged by IOCL as a transport contractor and complainant engaged the tanks/trucks under O.P.No.2 as working partner and for O.P.No.2 to-wards Bank Guarantee shown the fixed Deposit of Rs. 1,80,000/-. The transactions are for commercial purpose. The Complainant is not a consumer of the O.Ps.
The Bank Guarantee was valid for March 31, 2021. The Complainant withdrew his partnership in 2017 from O.P.No.2. Even after withdrawal from partnership liability of guarantee not ends. On 29.12.2022 the Bank unilaterally deducted the entire amount of the fixed deposit. The Complainant is eligible to take action against O.P.No.2. The Bank gave notice through SMS to the Complainant about the deduction from his deposit account. There is no any deficiency in service on the part of answering O.P. along with unfair trade practice.
Bank’s action were appropriate just and lawful. The Complaint is liable to be dismissed.
- The O.P.No.2 has been set ex-parte.
- The Complainant filed following documents:
- Copy of F.D. dated 10.09.2015 for Rs. 1,80,000/- in A/C No. 35217375523.
- Promissory note dated 10.09.2015 and D.P. note delivery letter dated 10.09.2015.
- Copy of Bank Guarantee No. 03/2015 covering period 10.09.2015 to 31.03.2021.
- Copy of Bank Guarantee from M/S Shyam Charan Bhoi dated 10.09.2015.
- Copy of affidavit regarding the withdrawal from transport tender by Complainant.
- SMS regarding hold for Rs. 1,80,000/- on 29.12.2022.
- Application for renewal of FD No. 03/2015 by Shyam Charan Bhoi to O.P.No.1.
- Letter dated 29.12.2022 of the O.P.No.1 to Shyam Charan Bhoi.
- Letter dated 15.02.2022 of the SBI to IOCL regarding extension of Bank guarantee.
- Complaint dated 31.12.2022 of the Complainant to S.B.I.
- Pleader notice dated 23.02.2023 of Sri. A. Meher on behalf of complainant.
- Copy of Agreement executed by borrower Shyam Charan Bhoi.
The O.P.No.1 although relied upon following documents but not filed the same.
- Bank Guarantee agreement.
- Notice of deduction.
- From the pleadings of the parties and after going through the documents following issues are framed:
-
- Whether the Complainant is not a Consumer of the O.Ps?
- Whether extension of Bank Guarantee without the consent and knowledge of Complainant amounts to deficiency in service and unfair trade practice?
- What relief the Complaint is entitled for.
Issue No.1:- Whether the Complainant is not a Consumer of the O.Ps?
The Complainant is a customer of the O.P.No.1 and running a S.B. Account. For O.P.No.2, the Complainant stood as a guarantor and to-wards Bank Guarantee has undertaken guarantee of Rs. 1,80,000/-. As a customer of the O.P. Bank the Complainant is a consumer.
The Complainant is having a number of tank trucks bearing No. OR 02 AH 3907, OR-09P-5401, OR 05 AP 3902, OR 05 AP 9945 and Or 04L 0337. The vehicles are used for commercial purpose certainly but it does not affect the status of the Complainant with O.P.no.1 as guarantor, depositor. The O.P.No.1 is taking the benefits and deposits of Complainant.
Regarding relationship with O.P.No.2 transport contractor the Complainant is a partner with the O.P.No.2. Vehicles of the Complainant are engaged in IOCL through the contractor. The O.P.No.2 is the hirer of service of Complainant and in business term principal-principal relationship exists. Accordingly, the Complainant is not a consumer of the O.P.No.2.
The case in hand is in different footing. The Complainant stood guarantor to the Bank. Guarantee of Shyam Charan Bhoi on 10.09.2015 for an amount of Rs. 1,80,000/-. The guarantee covered from 10.09.2015 to 31.03.2021 for Rs. 7,20,000/- and out of the amount Rs. 1,80,000/- amount of the Complainant covers in Bank guarantee.
The issue is answered accordingly.
Issue No.2 Whether extension of Bank Guarantee without the consent and knowledge of Complainant amounts to deficiency in service and unfair trade practice?
On 10.09.2015 Bank Guarantee of Rs. 720,000/- was issued by O.P.No.1 in favour of Shyam Charan Bhoi and the four partners namely Complainant, O.P.No.2 and other two stood guarantors. The vehicles of the Complainant were attached with M/S Shyam Charan Bhoi and work order No. OSO/OPS/POL/PT-03/2015/20/t/66/87 of the IOCL and Complainant submitted affidavit declaration to that effect.
The Bank Guarantee was valid till 31.03.2021. The D.P. note was executed infavour of O.P.No.1 on 10.09.2015. From the request letter it reveals that Shyam Charan Bhoi requested the O.P.No.1 for extension of Bank Guarantee No. 03/2015 up to 30.06.2022 and last claim upto 31.12.2022. Basing on the request letter of Shyam Charan Bhoi the O.P.No.1 extended the Bank Guarantee from 27.10.2021 to 28.02.2022 without the consent of the Complainant and further up to 31.12.2022.
No doubt the O.P.No.1 Bank has authority to recover the loan with interest amount from the guarantors in addition to principal borrower but suo-motu has no authority to extend the BG unilaterally without the consent of guarantors. The O.P.No.1 Bank has not issued any letter to the Complainant regarding extension of guarantee. When the borrower Shyam Charan Bhoi failed to pay the amount to the Bank, the O.P.No.1 deducted to-wards bank guarantee out of the maturity value of the F.D. amount.
F.D. No. 35217375523 matured on 10.09.2021. The amount of Rs. 1,80,000/- was adjusted on 29.12.2022. No doubt no any written objection has been given by Complainant before the O.P.No.1 during this period but on 31.12.2022 objection was made and by the time it had already been adjusted in loan account of Shyam Charan Bhoi and rest maturity value in the account of the Complainant.
The O.P.No.1 has no authority to extend guarantee without the consent of the guarantors in favour of borrower. Right to recovery started on 31.03.2021 against the Complainant but the O.P.No.1 not issued any letter against Complainant for recovery and extended the guarantee it is against the Barking norms and amounts to deficiency in service and unfair trade practice on the part of O.P.No.1
O.P.No.2 is a business partner of Complainant and has no any consumer liability.
The issue is answered accordingly.
Issue No. 3: What relief the Complaint is entitled for.
From the Supra discussion it is clear that the Complainant is entitle for the relief. The O.P.No.1 has authority to recover the guarantee amount from Complainant but immediately after 31.03.2021. After the lapse guarantee further extension amounts to unfair trade practice and deficiency in service.
Taking into consideration the circumstances of the case following order is passed:
ORDER
The Complaint is allowed on contest against the O.P.No.1 and dismissed ex-parte against O.P.No.2 for unfair trade practice and deficiency in service the O.P.No.1 is directed to pay a compensation of Rs. 2.00 lakhs and litigation expenses of Rs, 30,000/- within one month of this order. In-case of non-payment the whole amount will carry 12% interest P.A. from date of order till realisation.
Order pronounced in the open court on 17th Sept. 2024.
Supply free copies to the parties.
