Delhi

North East

CC/115/2016

Dr. Jai Chand Sharma & Anr. - Complainant(s)

Versus

Canara Bank - Opp.Party(s)

04 Mar 2020

ORDER

 DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: NORTH-EAST

GOVT. OF NCT OF DELHI

D.C. OFFICE COMPLEX, BUNKAR VIHAR, NAND NAGRI, DELHI-93

 

Complaint Case No. 115/16

 

In the matter of:

 

	1.     2.	Dr. Jai Chand Sharma S/o Late Sh. Har Lal Sharma   Smt. Asha Rani Sharma W/o Dr. Jai Chand Sharma Both R/o M-46, Uldhanpur Naveen Shahdara, Delhi-110032.		Complainants
		Versus
	1.       2.	Canara Bank Through its Branch Manager Rohtash Nagar, Delhi-110032.   M/s ICICI Bank Ltd Through its Principal Officer Videocon Tower, Loan Branch Jhandewalan, New Delhi.		Opposite Parties
			DATE OF INSTITUTION:         JUDGMENT RESERVED ON:               DATE OF DECISION      :		27.04.2016 04.03.2020 04.03.2020

 

N.K. Sharma, President

Ms. Sonica Mehrotra, Member

 

Order passed by Ms. Sonica Mehrotra, Member

ORDER

1. In the present complaint the complainant had urged that he had availed of a Housing Loan bearing Loan Account No. LBNOD00000989720 vide Home Loan Agreement dated 31.01.2005 from OP2 to the tune of Rs. 35,00,000/- and as per the repayment schedule agreed between the parties according to the Schedule B of the said Loan Agreement, the EMI of Rs. 45,290/- was to be paid in 120 equal instalments w.e.f. 01.04.2005 till 01.04.2015. However, the complainant has paid 132 EMIs till April 2016 before filing of the present complaint though he was supposed to pay Rs. 54,34,800/- to OP2 in ten years by way of 120   EMIs but has paid Rs. 57,00,650/- i.e. an excess amount of Rs. 2,65,850/- and therefore prayed for refund of the said excess amount and restraint order against OP2 not to charge any further EMI from his account maintained with OP1 since complainant had issued Auto Debit Instructions to OP2 in this regard through ECS Debit Clearing Mandate Form. Complainant has further submitted that OP instead of and despite having fixed the Floating Reference Rate (FRR) of interest @ 8.25, started charging interest as per Benchmark Prime Lending Rate (BPLR) at a much higher rate of interest. Complainant also prayed for compensation of Rs. 5,00,000/- for mental harassment and agony vide the present complaint.

Complainant has attached Home Loan Agreement related documents and correspondence between parties.

Complainant had also filed application for stay and contempt against OP2 which were already decided/dismissed vide order dated 30.04.2019.

2. In hearing held on 20.11.2019, complainant submitted that he has no grievance against his account holding bank i.e. OP1 which shall be a performa party as no relief sought against it.
3. We have carefully considered the arguments advanced by both sides and have keenly perused the documentary evidence placed on record.

As per the settled law of the Hon'ble Supreme Court in Hewlett Packard India Ltd. Vs Shri Ramachander Gehlot in CA No. 7107/2003 decided on 16.02.2004 vide which the Hon'ble Supreme Court held that issue of maintainability has to be decided before admitting or hearing the matter on merit and in judgment of Hon’ble NCDRC in Koshy Varghese Vs HDFC Bank Ltd III (2017) CPJ 52 (NC) wherein Hon’ble National Commission held that question in which law point is involved can be decided at any stage of the proceedings. Therefore, without going into the merits of the case, we shall adjudicate the admissibility / non-admissibility of the present complaint.

4. The key issue for consideration before us is whether the complainant is a consumer within the meaning of Section 2 (1) (d) (ii) of Consumer Protection Act, 1986.

The word ‘consumer’ is the fulcrum of the Consumer Protection Act (the Act) and is defined in Section 2 (1)(d) of the Act meaning any person who

1. buys and goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other that the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
2. hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purpose.

 

Explanation:- for the purposes of this clause, “Commercial Purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purpose of earning his livelihood by means of self employment.

 

The term ‘consumer’ has, thus, been defined to mean, a person who  is-

1. a buyer, or
2. with the approval of the buyer, the user of the goods in question, or    
3. a hirer or person otherwise availing, or
4. with the approval of such aforesaid persons, the beneficiary, of the service(s) in question

 

with the condition super added that such buying of the goods or hiring or availing of any such service, is for a consideration, -

1. paid, or
2. promised, or
3. partly paid or promised, or
4. covered by any system of deferred payment

 

5. On bare reading of the above, it is clear that consumer is a person who buys goods or hires/avails of services for consideration but excludes a person who does the same for commercial purpose.

In the instant case, on the basis of documentary evidence placed on record by the complainant as well as OP2, clause 1.6 of Office Premises Loan Agreement defines “LOAN” as amount of financial assistance as provided for construction, repair, acquisition, modification, improvement etc of the property and clause 1.8 thereof defines “PROPERTY” meaning immoveable property, for any intended office / commercial use described in the loan application. The statement of account and repayment schedule records placed before us clearly specifies the nature of loan as Loan Against Property (LAP) and as per the written statement of OP2 also, the said loan (LAP) is different from home loan and carries higher rate of interest. LAP is commercial in nature and therefore outside the purview of this Forum. The complainant had created a collateral mortgage of premises bearing No. E-1 Panchsheel Garden, Naveen Shahdara, New Delhi- 110032 with OP2 pledging the said property for securing the office premises loan.

The Hon’ble National Commission in the judgment of Union Bank of India and Anr. Vs Learning Spiral Pvt Ltd III (2018) CPJ 514 (NC) in which the Hon’ble National Commission was faced with a complaint of illegal encashment of cheque from current account for business purpose and after considering the key question whether the complainant maintaining a current account with the bank can be said to be a consumer within the meaning of CPA, the Hon’ble National Commission following the view taken by itself in its previous decisions of Sutlej Industries Vs PNB I (2018) CPJ 593 (NC), Subhash Motilal Shah Vs Malegaon Merchants Co-op Bank Ltd in RP No. 2571/2012 decided on 12.02.2013, M/s Sam Fine O Chem Ltd Vs UBI in CC No. 39/13 decided on 12.04.2013 and Samkit Art and Craft Pvt Ltd Vs SBI and Ors in CC No. 11/2007 decided on 14.10.2014, held that the complainant cannot be said to be a consumer within the meaning of Consumer Protection Act as it had hired / availed of service of the bank for commercial purpose i.e. for running a current account for business purposes. Therefore, the Hon’ble National Commission had dismissed the complaint with liberty to the complainant to approach the appropriate Civil Court for redressal.

The Hon'ble National Commission in Primus Chemicals Ltd Vs IFCI Ltd I (2017) CPJ 615 (NC) held that availing services of a financial institution for loan which was for commercial purpose was availing services for commercial use and held complainant was not a consumer. The Hon'ble National Commission in Miracle Coro Plast Pvt Ltd Vs United Bank of India II (2018) CPJ 29 (NC) held that the term loan and credit limit availed from the bank was taken for business and therefore was a case of hiring / availing of services of bank for commercial purpose and therefore the complainant had no locus standi to file the consumer complaint as he was not a consumer.

In the present case, it is evident that the complainant is trying to camouflage a commercial office premises loan under the garb of a housing loan whereas it is actually a loan against property which is purely commercial in nature. It is an admitted position that it is in respect of this Loan Agreement and interest rate levied by OP2 on the loan amount that the present complaint has been filed alleging negligence and deficiency of service. Since the account itself was connected and related to the commercial transaction of the complainant, service hired for that purpose would fall within the category of hiring services for commercial purpose. Therefore, it is clear that the services of OP2 were hired by the complainant for commercial purpose in course of enhancement of income by virtue of having availed office premises loan against property with OP2 bank for the purpose of carrying out his business activities, the purpose behind availing of such loan was to served the commercial interest of his medical profession for which the alleged loan was probably applied for but it is subject matter to be decided on merits not by this Forum. Requirements of restricted meaning of “Commercial Purpose” are that the complainant ought to have availed the services of OP2 exclusively for purpose of earning livelihood by way of self employment.

6. We are guided by the above settled principle of law as laid down by Hon’ble NCDRC in catena of judgments cited in forgoing paras and can be safely applied in the present case specially after appreciating the nature of transaction entered into between complainant and OP2 and the perusal of Loan agreement, Statement Of Account and Repayment Schedule placed on record by complainant himself.
7. The case of complainant relates to allegation of overcharging of interest in respect of loan taken by him but clearly since it was availed for his commercial activity, he was availing the services of OP2 for commercial purpose. Therefore, in view of inbuilt exception in the definition of consumer, complainant cannot be termed as a consumer as envisaged under Section 2 (1)(d)(ii) of CPA. That being the case, the complainant has no locus standi  to raise a consumer dispute under the CPA, 1986 and therefore we have no hesitation in holding that the complainant is not a consumer and on this count alone, dismiss the present complaint.  It is however made clear that dismissal of the complaint shall not come in the way of the complainant availing alternate remedy by way of approaching Civil Court/DRT in which event he may also seek benefit of provision of Section 14 of Limitation Act for condonation of delay for time spent before this Forum as provided under Laxmi Engineering Works Vs RSG Industrial Institute (1995) 3 SCC 583 passed by Hon’ble Supreme Court. 
8. Let the copy of this order be sent to both parties free of cost as per Regulation 21 (1) of Consumer Protection Regulation 2005.
9.   File be consigned to record room.
10.   Announced on  04.03.2020.

 

(N.K. Sharma)     President

(Sonica Mehrotra)  Member