Punjab

Amritsar

CC/15/429

Kavita Katyal - Complainant(s)

Versus

Bank of Maharastra - Opp.Party(s)

07 Oct 2016

ORDER

 

Order dictated by:

Sh.S.S.Panesar,President.

1. Ms.Kavita Katyal complainant has filed the present complaint under section 11,12,13 & 14 of the Consumer Protection Act on the allegations that husband of the complainant namely Satish Katyal was customer of opposite parties No.1 & 2 and opposite parties NO.1 & 2 issued OD limit  to the husband of the complainant  in the account bearing No. 60073488574 product : CC-IND-AGST-NSC/KVP/ETC-BASE having drawing limit of Rs. 15,00,000/-  after pledging the following LIC policies

Policy No.	Sum Assured
473315625	Rs.1.25 Lacs
473300637	Rs.1.00 lac
473300636	Rs.1.00 lac
473301674	Rs.1.00 lac
473301677	Rs.1.00 lac
473301675	Rs.1.00 lac
473299069	Rs.1.10 lac
473299959	Rs.3.00 lac
473315627	Rs.1.25 lac
472900259	Rs.3.00 lac
473315624	Rs.1.25 lac

2.       As such LIC policies having sum assured more than Rs. 15 lacs were pledged with the opposite parties No.1 & 2. Opposite parties No.1 & 2 facilitated the husband of the complainant to issue CC current account of firm United Iron and Steel Enterprises situated at 160-A, East Mohan Nagar, Amritsar  in account bearing No. 20034500368 product-CUR-GEN-PUB-CORP-NONRURAL having drawing limit of Rs. 15 lacs. Moreover, husband of the complainant was having no any other account to operate the abovesaid OD limit. All the transactions were operated by the husband of the complainant through said current account. Unfortunately, on 9.11.2014 husband of the complainant expired. Immediately on 10.11.2014 complainant moved an application to opposite parties No.1 & 2 for stop payment of all the cheques issued by the firm United Iron and Steel Enterprises signed by the husband of the complainant and opposite parties No.1 & 2 also issued endorsement on the same . On the basis of said request, on 11.11.2014 opposite parties NO.1 & 2 dishonoured two cheques issued by the husband of the complainant. It is worthwhile to  mention here that as per the procedure of the law, when any person dies, the post dated cheques are having no relevance for encashment. Husband of the complainant was having business dealing with a number of firms including opposite party No.3 and it might be possible that one cheque was misused by said opposite party No.3 duly issued as security in the business dealing. But the said opposite party No.3 has presented cheque bearing No. 23937 by filling an amount of Rs. 5,43,427/-  and it might also be possible that said cheque was dishonoured by opposite parties No.1 & 2 due to application moved regarding death of husband of the complainant.  The abovesaid OD limit amount was used by the husband of the complainant at the time of his death. In order to complete the OD limit amount, the amount of the policies was transferred  into the said OD account  and the credit balance was also stand. Again on 2.6.2015, the cheque bearing No. 23937 having amount of Rs. 5,43,427/-  was presented by opposite party No.3 and opposite parties No.1 & 2 had wrongly on 2.6.2015 issued Rs. 2,00,974/- on 4.6.2015 issued Rs. 3,31,122/- from the said OD account through CC limited and on 2.6.2015 issued Rs. 11,331/- from the saving account bearing No. 20034511225 totalling Rs. 5,43,427/- in favour of opposite party No.3 despite having intimation regarding the demise of said Sh.Satish Katyal. The complainant visited opposite party No.1 number of times and informed them about this illegal act, but opposite parties No.1 & 2 did not pay any heed. Due  to the illegal act of the opposite parties No.1 & 2 , complainant had suffered a lot of mental and financial pain and agony at the hands of the opposite parties No.1 & 2. The complainant has sought for following reliefs vide instant complaint:-

1. Opposite parties No.1 & 2 may be directed to make the payment of cheque of Rs. 5,43,427/- illegally cleared in favour of    opposite party No.3 alongwith interest.
2. Compensation to the tune of Rs. 5,00,000/- may also be awarded to the complainant alongwith litigation expenses to the tune of Rs. 20000/- be also awarded to the complainant.

Hence, this complaint.

3.       Initially opposite parties No.1 & 2 did not opt to put in appearance and as such they were ordered to be proceeded against ex-parte. But later on  opposite parties No.1 & 2 put appearance through Counsel Sh.Sahil Sharma and they were allowed to join the proceedings at that stage.

4.       Opposite party No.3 appeared and contested the complaint by filing written version taking certain preliminary objections therein inter alia that the present complaint is not legally maintainable  and the same is an abuse of process of law ; that the present complaint is bad for mis-joinder and non-joinder of necessary parties . No allegation of any kind whatsoever has been leveled against the replying opposite party and moreover no relief has been claimed against opposite party No.3. But even inspite of that the complainant has intentionally and willfully impleaded opposite party N.3 as party to the present complaint ; that the present complaint is nothing but just a counterblast to the civil suit for recovery already filed by the replying opposite party against the complainant and her children titled as “Suresh Gupta Versus Kavita Katyal & Others” which is pending in the court of law at Ludhiana and opposite party No.3 has been falsely impleded in the present complaint just to put pressure on him to withdraw the said civil suit for recovery ; that no cause of action arose to the complainant for filing the present complaint against the replying opposite party, as such the complaint is liable to be dismissed; that  the complainant has not come to this Forum with clean hands and has suppressed the true and material facts from the knowledge of this  Forum. The real facts of the present case are that Sh.Satish Katyal, husband of the complainant was doing business under the name and style of M/s. United Iron and Steel Industries and he had been purchasing M.S. Sire Rod and WR Coil from the replying opposite party. Total amount of Rs. 12,97,432/- was due against Sh. Satish Katyal. Out of the total outstanding amount the husband of the complainant namely Sh.Satish Katyal has made payment of Rs. 10,93,427/- to opposite party No.3 vide three different cheqeus  which were duly encashed by opposite party No.3. But thereafter he has failed to pay the remaining amount to opposite party N.3. In the meantime unfortunately  Sh.Satish Katyal, husband of the complainant expired  and after his death opposite party No.3 raised demand of remaining amount from the complainant, who assured that  they will make the payment of balance amount very soon. But as they have failed to pay the balance amount, as such suit for recovery has been filed against the complainant and her children which is pending in the competent court of law at Ludhiana. All these material facts have been intentionally and willfully concealed by the complainant from this Forum , as such the complaint is liable to be dismissed on this score also. On merits, facts narrated in the complaint have been specifically denied and a prayer for dismissal of complaint was made.

5.       In her bid to prove the case complainant tendered into evidence her duly sworn affidavit Ex.CW1/A alongwith documents Ex.C-1 to  Ex.C-20 and also  tendered documents in rebuttal evidence  copy of account  statement Ex.C-21, form No. 3CB Ex.C-22, copy of  Form No.3 CD Ex.C-23, copies of Annexure 1 to 4 Ex.C-23A to Ex.C-26, copy of computation of income Ex.C-27 and closed the rebuttal evidence on behalf of the complainant.

6.       To rebut the aforesaid evidence Sh.Munish Kohli,Adv.counsel for opposite party No.3 tendered into evidence affidavit of Sh.Suresh Kumar, Prop.Ex.OP3/1 alongwith documents Ex.OP3/2 to E x.OP3/15 and closed the evidence on behalf of opposite party No.3.  

7.       On the basis of the evidence on record, ld.counsel for the complainant has vehemently contended that husband of the complainant was running a firm known as United Iron and Steel Enterprises & held a  current account with opposite parties No.1 & 2. The husband of the complainant had obtained a limit to the tune of Rs.15 lacs from opposite parties No.1 & 2 by pledging LIC policies detailed in para No.1 of the order. On 9.11.2014 husband of the complainant died.  Opposite parties No.1 & 2 were intimated regarding the death of Satish Katyal on the very next day i.e. 10.11.2014, vide letter Ex.C-5. It was also intimated that no transaction should be done in the current account No.20034500368 standing in the name of the firm of Sh. Satish Katyal. But, however, opposite parties No.1 & 2 ignored the guidelines issued by RBI regarding the conduct of account on the death of an account holder and hatched a conspiracy in connivance  with opposite party No.3 by giving it undue advantage and cleared /passed chque bearing No.23937 on 2.6.2015 for Rs.  5,43,427/- despite receipt of letter, copy whereof is Ex.C-5 on record. The account statement of current account , over draft account and saving account are Ex.C-19 and Ex.C-20. The entry regarding  clearance of the cheque was not mentioned by opposite parties No.1 & 2 deliberately. Moreover, the complainant also tendered documents regarding statement of current account  which were signed by the bank officials Ex.C-21. The said entry regarding clearance of cheque amounting to Rs. 5,43,427/- had not been shown in the statement of account. Moreover, as per statement Ex.C-19 and C-21 regarding current account statement , on 11.11.2014 two cheques were dishonoured and balance of Rs. 27,266/- was left in the current account. How  was it possible that cheque amounting to Rs. 5,43,427/- was cleared while the remaining cheques for small amounts were dishonoured. Moreover, as per guidelines of RBI, operation of account was to be immediately stopped and no cheque was to be cleared thereafter  even though the same be issued prior to the death of account holder. When  legal notice dated 15.6.2015  was issued to opposite parties No.1 & 2,  in reply dated 13.7.2015 Ex.C-2 , opposite parties  admitted that application dated 10.11.2014 Ex.C-5  was received  but since details of the cheques were not mentioned to  stop the payment besides that  amount(s) of the cheques were also not mentioned, which was required for  making the stop payment. Reply submitted by opposite parties No.1 & 2 was ridiculous  and it was against the guidelines of  RBI. In the written arguments opposite parties No.1 & 2 i.e. bank has made the allegation that since the  transaction was commercial, therefore, the Forum is not empowered to entertain the present complaint. But, however, the law is otherwise because the complainant vide instant complaint has complained regarding the deficient banking services, which are covered u/s 2(1)(o) of the  Consumer Protection Act. For  challenging the deficiency in service of the bank, the District Consumer  Forum is the proper authority . Reliance in this connection has been placed on Standard Chartered Bank Ltd. Vs. Dr.B.N.Raman 2006(3) RCR (Civil) 625, wherein it has been laid down that the  Consumer Protection Act, 1986 provides for formation of National Commission, State Commission and District Forum.  These are remedial agencies.  Their functions are quasi judicial. The purpose of  these agencies is to decide consumer disputes. Activities  relating to non-sovereign powers of statutory bodies are within the purview of the Act. The functions of such statutory bodies come under the term ‘service’ under section 2(1)(O) of the Act. Banking is a commercial function. ‘Banking’ means acceptance, for the purposes of lending or investment of deposit of money from the public, repayable on demand or otherwise  (See Section 5(b) of Banking Regulation Act, 1949). The intention of the 1986 Act is to protect consumers of such services rendered by the banks. Banks provide or render service/facility to its customers or even non-customers. They render facilities/services such as remittances, accepting deposits, providing for lockers, facility  for discounting of cheques, collection of cheques, issue of bank drafts etc. In Vimal Chandra Grover Vs. Bank of India (AIR 2000 SC 2181) this court has held that banking is business transaction  between bank and customers. Such customers are consumers within the meaning of Section 2(1)(d)(ii) of the Act. In case titled as Vimal Chandra Grover Vs. Bank of India 2000(3) AIR SCR 587, it has been held that  “we reject the argument that the appellant is not a consumer or that the bank is not providing any service to the appellant. The only question that requires consideration if there was any deficiency in service in the present case. Since opposite parties No.1 & 2 were deficient in providing banking service to the complainant and have also flouted  the guidelines of RBI regarding the customers, who had died after issue of the impugned cheques , instead of stopping the payment, opposite parties No.1 & 2 wrongfully operated the account and also cleared the cheque amounting to Rs. 5,43,427/- issued by dead customer i.e. husband of the complainant, in contravention of RBI guidelines contained in Annexure-A, therefore, opposite parties No.1 & 2 are deficient in service and instant complaint is liable to be allowed and the same may be allowed in view of the prayer made by the complainant.

8.       But, however, from the appreciation of the facts and circumstances of the case, it becomes evident that the complainant has miserably failed to prove that she is a consumer as provided u/s 2(1)(d) of the Consumer Protection Act. It is nowhere alleged in the complaint that complainant was holder of the account in dispute or that she was running the business of the enterprise of her husband for earning her livelihood . There is absolutely no averment in the complaint even stating that the complainant  happen to be the consumer under opposite parties No.1 & 2. In the present case , husband of the complainant was running the business concern i.e. United Iron and Steel Enterprises, Amritsar for the purpose of earning profit. It is well settled law that husband of the complainant purchased JP Rok Machine for his commercial enterprise  and he was running a company which was incorporated under the provisions of the Companies Act, 1956 . Satish Katyal was carrying on business of manufacturing sponge iron, billets, power, ferro alloys, ferro manganese, metal ferro manganese, silicon manganese, metal silicon manganese etc  and for that purpose  his company purchased JP Rok machine. It is apparent that the said machine was purchased by the husband of the complainant for expanding his business. Therefore, dispute between the parties does not fall within the ambit of  Consumer dispute and this forum has no jurisdiction to entertain the instant complaint and the complaint is liable to be dismissed. Reliance in this connection can be had on Sathya Sai Agencies-Petitioner  Vs. Punjab National Bank & Ors-Respondents 2016(1) CLT 308(NC) wherein it has been laid down that in the instant case, admittedly the petitioner/partnership firm had opened its business account with the respondent bank. The subject cheque admittedly was issued in favour of respondent No.3 in respect of a business transaction and it was drawn on the said current account. Therefore, it is clear that the services of the bank were availed by the complainant for commercial purpose and the subject cheque was issued in favour of opposite party No.3 in relation to a commercial transaction. Therefore, in view of the exception carved out in the definition of consumer, the petitioner is not a consumer as envisaged under section 2(1)(d) of the Consumer Protection Act, 1986. The petitioner partnership firm being an unnatural person by no stretch of imagination can avail of the benefit of the explanation.

9.       Further reliance can be had on The Branch Manager, Punjab National Bank Versis Bhaskar Textiles 2015(1) CLT 89 (NC) wherein it has been laid down that admittedly  both the respondents firms are in the business of textile product and they sent the goods sold by them through petitioner bank who was also required to collect the payment before releasing bilties  to M/s.Shanker Traders. From this it is evident that the services of the petitioner was availed by both the respondents complainants in relation to commercial purpose i.e. their business transaction. Therefore in our considered view the respondents are not covered with the definition of consumer. As such they could not have maintained the consumer complaint.

10.     Further more it was a cash credit facility which was obtained by deceased husband of the complainant namely Satish Katyal . Nowhere it has been mentioned in the complaint that her husband was carrying on the business by means of self employment  for earning his livelihood. Since cash credit facility falls within the purview of commercial transaction, therefore, complainant cannot be said to be falling within the ambit of consumer. Reliance in this connection can be had on Oriental Bank of  Commerce-Appellant Vs. Sushil Gulati-Respondent 2015(2) CLT 25 (NC) wherein it has been laid down that appellant specifically pleaded in the written  statement that transaction was for commercial purpose. Admittedly cash credit facility was obtained by the complainant for running his business. Complainant nowhere in the complaint has mentioned that he was carrying on business by means of self employment for earning his livelihood. In such circumstances, aforesaid facility falls within purview of commercial transaction and complainant does not fall within purview of consumer   This commission in 1(1991) CPJ 330 M/s. Oswal Fine Arts Vs. M/s. HMT, Madras while dismissing complaint observed as under:-

          :2 (i)xxxxxx

          (ii)     Another formidable objection to the maintainability of this claim is that the matter is sub judice before the Madras High Court on its original side where the complainant has instituted a suit for damages against the respondent based on the identical cause of action. There is also a cross suit filed by the respondent company in the city Civil Court at Bangalore claiming certain reliefs against the complainant in respect of the same transaction. When the matter is, thus, sub judice before the ordinary Civil Courts of the land, this Commission cannot and will not entertain any claim for compensation in respect of the identical subject matter.

(iii)    There is yet another insuperable obstacle  disentitling the complainant to approach this National Commission with a claim for compensation, namely, that he is not a “consumer” as defined in section 2(1)(d)(i) of the Consumer Protection Act, 1986. Admittedly, the machinery in question was purchased by the complainant for the purpose of its use in his Oswal Fine Arts Printing press which is a commercial establishment. A person who obtains goods for a commercial purpose is specifically excluded from the scope of the expression “consumer”  by the definition contained in section 2(1)(d)(i).”

In the light of the aforesaid judgment, it becomes clear that the complaint was not  maintainable as cash credit facility was taken for commercial purpose and Civil suit was also pending between the parties . Learned State  Commission committed error in allowing compensation of Rs. 50000/- without any evidence and basis and in such circumstances, impugned order is liable to be set-aside.

11.     The contention of the counsel for the complainant that impugned cheque to the tune of Rs. 5,43,427/- has been cleared while some other cheques were dishonoured and the further fact that certain other cheques were also cleared despite the fact that the account holder was already intimated to have died and in that situation the complainant fell within the purview of consumer dispute, is not at all acceptable. Since the account in dispute was cash credit facility and it was held in the name of a company which was registered under the Companies Act the transaction in dispute fell within the purview of commercial transaction and this forum has no jurisdiction because the dispute inter-se parties was not a consumer dispute. The remedy lay in filing proceedings before the  Civil Court which according to the parties is already seized of the matter.

12.     Consequently, instant complaint fails and the same is ordered to be dismissed accordingly. Case could not be disposed of within the stipulated period due to heavy pendency of the cases in this Forum. Copies of the order be furnished to the parties free of costs. File is ordered to be consigned to the record room.

Announced in Open Forum