JUDGMENT Per Jagroop Singh Mahal, Member Briefly stated the facts of the complaint are that the complainant company a private limited company registered under the Companies Act was sanctioned certain credit facilities by Bank of Punjab Ltd. through its branch at Sector-35, Chandigarh in the year 1996 and the said bank subsequently merged with Centurion Bank Ltd. and then with HDFC Bank Ltd. The credit facilities were sanctioned against two collateral securities viz. residential house bearing No.305, Sector-6, Panchkula and Industrial sheds bearing Nos.437-438, Industrial area, Phase-1, Panchkula. The account of the complainant remained good throughout the period of its existence. However, it was revealed that the bank had been charging interest over and above the sanctioned rate. The bank admitted its mistake of overcharging interest and a sum of Rs.10.00 Lacs was waived on this account and letter dated 31.1.2006 was issued by the bank as confirmation of the above. The complainant complied with all the stipulations laid down in the said letter and adjusted the account as per schedule and manner prescribed therein. The original renewed bank guarantee bonds were released and returned to the bank and the same were duly discharged by the bank on 8.2.2006, as also the margin money deposited against these bank guarantees was released and credited to the account of the company. The settled amount was also paid within the stipulated time. However, the bank despite compliance with necessary stipulations laid down vide letter date 31.1.2006 chose to release the papers of only one property i.e. residential house but title deeds in respect of industrial property have not been released inspite of repeated requests. Though the original renewed bank guarantee bonds were duly received and discharged by the bank, yet the said papers were not released on the pretext that the beneficiary thereof Uttar Haryana Bijli Vitran Nigam (for short UHBVNL) had raised a controversy in that regard and instituted a suit on 26.5.2009 at Ambala wherein the bank was arrayed as defendant but no claim on account of these bank guarantees was raised on the bank. The learned Ambala court allowed the application of the complainant company under Section 8 of the Arbitration and Conciliation Act,1996 in the said suit vide its order dated 3.2.2010 and referred the matter to Arbitration as per arbitration clause in the contract entered into between the complainant company and UHBVNL in respect of which bank guarantees were issued. All these facts were brought to the notice of concerned officials of the bank vide letter dated 8.2.2010 but no reply was received. 2. It was also alleged that in the plaint before Ambala Court, UHBVNL had annexed certain documents including letter dated 2.6.2006 Annexure -4 issued by the Bank to UHBVNL wherein they have clearly mentioned that the original renewed bank guarantee was returned to the bank, hence the bank was discharged from the liability and the bank was not liable to make payment under the guarantee. In the said suit, the bank had also moved an application under Order 7 Rule 11 of CPC declaring that there was no cause of action against the bank, thus it was unequivocally and unambiguously proved that the bank had absolutely no justification to keep title deed in respect of industrial property after 2.6.2006, thereby causing wrongful loss to the complainant. Complainant also served legal notice upon OPs dated 1.4.2010 but to no effect. Hence, alleging deficiency in service on the part of OPs, complainant filed this complaint before the Commission seeking directions to OPs to release the title deed in respect of industrial property and also pay a sum of Rs.20.00 lacs alognwith interest @ 18% p.a. pendent lite and future interest. 3. OPs contested the complaint and filed a joint reply inter-alia stating therein that the loan sanctioned to the complainant was for commercial purposes, as the bank had sanctioned various credit facilities to the complainant company and present complaint relates to the said transaction which is not covered under the provisions of the Consumer Protection Act,1986(hereinafter to be referred to as the Act). The bank had given bank guarantee on behalf of the complainant to UHBVNL and the original bank guarantees have been illegally taken by the complainant from their records and handed over to the bank. The UHBVNL which had lodged claim with the bank has not been made party and further complicated questions of fact are involved in this case which cannot be decided summarily. It was asserted that the account of the complainant was running irregular and on its proposal of one time settlement the bank vide letter dated 31.1.2006 approved the said proposal and agreed to settle the account for a sum of Rs.46.00 Lacs against the book outstanding amount of Rs.55.97 lac and Annexure A-1 produced by the complainant is the sanction letter for one time settlement agreed by the bank. The bank had released the title deed in respect of the residential house but the title deeds in regard to industrial property are still lying with the bank as there is dispute going on regarding the liability of the bank in respect of the bank guarantees issued by it in favour of UHBVNL, therefore, in order to secure the bank, it has not released the original title deed of the industrial property of the complainant. This was a commercial decision taken by the bank as a goodwill gesture that the bank had released the title deed of the residential house as the value of the industrial property was sufficient to cover the liability of the bank under the bank guarantees. It was pleaded that the bank has not overcharged interest and title deeds have not been released because of litigation going on between the complainant and the beneficiary of bank guarantees i.e. UHBVNL and till it is finally decided, title deeds cannot be released. A prayer was made for dismissal of the complaint. 4. Parties adduced their evidence by way of affidavits and documents. 5. We have heard learned counsel for the parties and gone through the file carefully. 6. Learned counsel for OPs has argued that it was a commercial transaction between the parties, that the service was rendered to the complainant for their commercial activities and therefore the complainant is excluded from the purview of the Act and the present complaint is not maintainable. On the other hand, learned counsel for complainant referred to the case Vimal Chander Grover Vs Bank of India 2000(5)S.C.C.122 in which case overdraft facility was granted to the customer and it was held that the same amounted to service and a complaint would be maintainable. This authority pertains to a case in which cause of action arose in 1992 and the authority itself was rendered before the amendment of Sub-clause(ii) of clause (d) of Section 2(1) of the Act which by Amendment Act 62 of 2002 the words “but does not include a person who avails of such services for any commercial purpose” were added with effect from 15.3.2003. In case Central Bank of India Vs Om Sons Wires (P) Ltd. 2007(1)CLT 407 Hon’ble National Commission (in para-12) held that the said amendment could not be with retrospective effect and therefore service relating to the matter filed before 15.3.2003 could not be rejected by the Consumer Fora on the ground that the same had been obtained for a commercial purpose and therefore complainant would not fall under the definition of ‘consumer’. However, after the amendment the situation would be different that any such service rendered for any commercial purpose would take the complainant out of the purview of ‘consumer’ and the complaint would not be maintainable. In this respect we may refer to the case Economic Transport Organization Vs Charan Spinning Mills (P) Ltd I(2010)CPJ4(SC). In this case OP was engaged to transport a consignment but the vehicle carrying the said consignment met with an accident and the consignment was completely damaged. It was held by the Hon’ble Supreme Court (in para-25) as follows ; 25.“We may also notice that Section 2(d) of Act was amended by Amendment Act 62 of 2002 with effect from 15.3.2003, by adding the words “ but does not include a person who avails of such services for any commercial purpose” in the definition of ‘consumer’. After the said amendment, if the service of the carrier had been availed for any commercial purpose, then the person availing the service will not be a ‘consumer’ and consequently, complaints will not be maintainable in such cases. But the said amendment will not apply to complaints filed before the amendment.” 7. A similar question again arose in the case Birla Technologies Ltd. Vs Neutral Glass and Allied Industries Ltd. I(2011) CPJ 1(SC). In that case the OP developed a computer software for commercial use of the complainant. Dissatisfied with the working of modules and service as provided by the appellant/OP, a complaint was filed against them but the same was dismissed by the State Commission. In the appeal, Hon’ble National Commission held the complainant to be a consumer and allowed the same. Hon’ble Supreme Court of India held that since the goods were purchased for a commercial purpose, the services hired or availed of too would be for a commercial purpose and therefore complainant cannot be considered as a ‘consumer’ for the services which are obtained for a commercial purpose, after the amendment of sub-clause(ii) of Clause (d) of Section 2(1) of the Act. 8. In the present case there is no dispute about it that the complainant is a private limited company doing commercial activities. It had obtained credit facilities from OP bank for running its business and the bank guarantee bonds were obtained to facilitate its commercial business. The OPs were therefore rendering service to the complainant in connection with their commercial activity which would exclude the complainant from the purview of ‘consumer’ and it would be having no locus standi to file a complaint under the Act. The present complaint, therefore, must fail on this ground. 9. When the case is viewed on merits, we find that the OPs were not only deficient in rendering service but had told lies in their reply filed before this Commission. The contention of the complainant is that OPs had been charging excess interest on the amount advanced to them. This fact was admitted vide Annexure C-1/1 vide which figure of Rs.631657.66p was calculated towards excess interest charged as per sheets enclosed. This amount was subject to further verification by the competent authority and according to the complainant the total amount came out to Rs.9.97 lac as per letter Annexure C-1 dated 31.1.2006. The OP, however, gave a false reply to para NO.5 when it was mentioned that the bank had not at any stage admitted the fact of overcharging interest. This reply was given totally in contradiction to the allegations referred to above. There is no explanation from the side of OP as to why it told a lie while giving reply to para NO.5 of the complaint. 10. The next deficiency is for not returning the title deeds to the complainant even after the complainant had satisfied all the requirements of settlement annexure C-1 dated 31.1.2006. As per this settlement, complainant was to perform various acts and to pay various amounts by due dates. It is admitted by OPs that the said payments have been made by the complainant in all. Their contention, however, is that they received letter dated 19.2.2006 and subsequently dated 4.5.2006 vide which Executive Engineer/TRW,UHBVNL,Dhulkote demanded Rs.2.5 lacs from them on account of non-performance of their promise by the complainant. The copies of bank guarantees have been produced by the complainant as Annexure C-1/3 and C-1/4. It is mentioned in the concluding para of both the bank guarantees that the same shall remain in force until 19.5.2004 and 30.5.2005 respectively unless a suit or action to enforce a claim under the guarantee is filed against the guarantor bank within six months from that date. There is no evidence to prove if any suit or action to enforce the claim was filed within the said period of six months. 11. The learned counsel for OPs argued that the limitation period could not be curtailed as it was hit by the provisions of Section 28 of the Contract Act. This question was examined by the Hon’ble Punjab High court in case Pearl Insurance Co. Vs Atma Ram AIR 1960 Punjab 236 wherein it was held that as the clause did not limit the time within which the insured could enforce his rights and only limit the time during which the contract will remain alive and therefore it was not hit by the provisions of Section 28 of the Contract Act. The learned counsel has also referred to National Insurance Co. Ltd. Vs Sujir Ganesh Nayak & Co. and Another 1997(4) Supreme Court Cases 336 wherein it was held that such a condition in insurance policy relieving the insurer from liability for loss or damage unless the claim was raised before the expiry of the specified period would be valid and effective. 12. The OPs have not produced any evidence to suggest that the UHBVNL initiated the suit or action against OPs to enforce the claim within six months from 19.5.2004 in case of bank guarantee Annexure C-1/3 and from 30.5.2004 in case of bank guarantee Annexure C-1/4. After the said period, OP bank has no liability to pay any compensation or damage under the said bank guarantees. Not only this, Centurion Bank of Punjab vide letter dated 2.6.2006 Annexure -4 informed the Executive Engineer/Workshop, UBHVNL, Dhulkote that the original renewed bank guarantee was returned to the bank and therefore OP bank was discharged from the liability. It is, therefore a case where no action had been taken within the time prescribed under the bank guarantee. The bank has already received guarantee back and had informed the Executive Engineer that it is discharged from the liability but strangely enough has not returned the title deeds to the complainant simply on the basis of letters dated 19.2.2006 and 4.5.2006 which are not even proved according to law having been written by any authority. There is, therefore, grave deficiency in service on the part of OPs. 13. As per letter Annexure A-4 dated 2.6.2006 the bank guarantees had been returned to the OP bank. However, preliminary objection NO.3 of its reply OP bank mentioned that the original bank guarantees had been illegally taken by the complainant from their record and handed over to the bank. OP bank did not produce any evidence to prove this allegation. It is not the case of Executive Engineer, UHBVNL if bank guarantees were illegally taken away by the complainant from their record. This false ground was therefore taken by OPs simply to justify their illegal action in detaining the title deeds of the property of complainant illegally for some ulterior motive. In this para also OPs told lie and gave false assertion. 14. In the year 2009, UHBVNL had filed a civil suit for recovery against the complainant and the OP bank. In that case the complainant filed an application under Section-8 of the Arbitration and Conciliation Act, upon which parties were referred to the sole arbitration of Managing Director UHBVNL. The complainant had presented their claim to the said Managing Director in which OP bank was not even made a party. It is argued that UHBVNL has not filed arbitration proceedings either against the complainant or against OPs as is clear from annexure C-1/5. The question of any liability being fastened upon OP bank in the absence of it being a party to the arbitration proceedings, therefore, does not arise. However, even inspite of that the title deeds are being retained by OPs illegally. 15. Otherwise also, the chances of claiming the amount from the bank are remote, after a period of more than three years is over and no claim/suit appears to be pending against it. 16. The complainant had filed an application U/s 340 CrPC to prosecute the OP for giving false replies and false evidence in its written reply and affidavit. Now OP has filed an affidavit admitting their fault as the reply was prepared on the basis of incomplete and old record. In view of the affidavit the complainant has withdrawn the application and does not want any criminal action against the OP. The application U/s 340 CrPC is accordingly dismissed. In view of the above discussion, we are of the opinion that though the complainant has a good case on merits and the OPs are liable not only to be prosecuted for giving false reply on affidavit before this Commission but also could be burdened with heavy compensation in this respect, yet complainant not being a consumer because it availed services of OP bank for a commercial purpose, complaint cannot succeed. The same is accordingly dismissed, leaving the parties to bear their own costs.
| | HON'BLE MR. JAGROOP SINGH MAHAL, MEMBER | HON'BLE MRS. NEENA SANDHU, PRESIDING MEMBER | , | | 
