BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION AT BANGALORE (URBAN)

DATED 29^TH DAY OF MARCH 2022

ORDER

SRI.K.S.BILAGI, PRESIDENT

1. The complaint has been filed under Section 12 of C.P.Act, 1986 on 06.07.2020 (herein under referred as an Act) for the following reliefs against the OPs:-

(a) To return the amount of Rs.60,835/- which is deducted on the illegal heads without the knowledge of complainant without their being proper cause.

(b) To furnish the insurance details for which the OPs have deducted a sum of Rs.80,000/-.

(c) Compensation payable on account of mental agony and loss caused to him on account of deficiency of service on the OPs as Rs.10,00,000/- and award cost and grant such other reliefs.     

2. The case set up by the complainant in brief is as under:-

The complainant being the owner in possession enjoyment of ,site bearing No.25 measuring 1200 sq.ft. under registered sale deed dated 02.02.2016 decided to avail loan of Rs.20,00,000/- from OP No.1.  OP No.2 agreed to sanction the loan and OP No.3 has obtained signatures of the complainant and other co-borrowers on the blank loan application.

3. It is further case of the complainant that Rs.3,540/- has been collected from him towards process fee and he was in need of only Rs.18,00,000/- as loan and first OP No.1 handed over cheque for Rs.17,39,165/- to the complainant towards said loan and complainant agreed to repay the same on monthly installment for a period of 180 days.

4. The complainant came to know that an amount of Rs.3,635/- has been deducted as pre-EMI from his loan account. The collection of Rs.60,835/- and deduction of Rs.80,000/- towards insurance is illegal on the part of the OP.  The OPs have deducted above amount without knowledge and without furnishing the details.  The act of the OP had put the complainant under mental tension.  Therefore, complainant claims Rs.10,000/- towards cost and compensation.  The OPs have caused deficiency of service to the complainant.  Hence, this complaint.

5. After receipt of notice, the OPs appear and file version.  The complainant has not the consumer and complaint is not maintainable under law.  OPs disputes the sanctioning of loan of Rs.18,00,000/- and giving of cheque for Rs.17,39,165/-.  In response to the legal notice of the complainant dated 04.03.2020, a suitable reply was issued.  The deduction of the amount is legally correct.

6. The loan of Rs.20,00,000/- was sanctioned to the complainant and complainant availed loan of Rs.18,18,000/- and 2% deducted towards process fee and 18% of GST i.e. Rs.47,200/- and insurance amount of Rs.80,000/- has been deducted, Rs.590/- towards CEERSAI, Rs.3,540/- IMD, and pre-EMI of Rs.9,505/- has been deducted.  The claim of the complainant is purely civil in nature.  The OPs request to dismiss the complaint.

7. The complainant files his affidavit evidence and relies on 17 documents.  The OPs have filed affidavit evidence of their official and they rely on 9 documents.

8. Heard the arguments of both sides and perused the written arguments. 

9. The following points arise for our consideration:-

1. Whether District Forum had pecuniary jurisdiction on the date of filing complaint
2. The complainant proves deficiency of service on the part of OPs?
3. Whether the complainant is entitled to relief mentioned in the complaint?
4. What order?

10. Our answers to the above points are as under:

       Point No.1:  In the negative.

      Point Nos.2 and 3:- do not survive for consideration.

      Point No.4: As per final orders

REASONS

11. Point No.1: The complainant seeks direction against the OPs to pay in all Rs.11,40,835/-.  As per the allegations made in the complaint, the complainant had applied for loan of Rs.20,00,000/- with OP No.1 and against sanction loan of Rs.18,00,000/-, the loan amount of Rs.17,39,165/- was only released in favour of the complainant by means of a cheque.  The complainant has not valued the complaint for the purpose of pecuniary jurisdiction. 
12. At this stage, it is relevant to refer Section 11(1) of C.P.Act, 1986 which read thus:-  

11(1): Jurisdiction of the District Forum: (1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed (does not exceed rupees five lakhs).  

13. According to the above provision, the pecuniary jurisdiction of the then District Forum was up to Rs.20,00,000/-.  The value for the purpose of pecuniary jurisdiction could be ascertained on the basis of value of goods or service and claim amount.  According to the complainant, the value of service i.e. application for advancement of loan as could be seen from Ex.A.1 that was Rs.20,00,000/-.  The claim made by the complainant is Rs.11,40,835/-.  As per Section 11(1) of C.P.Act, 1986, the complainant was supposed to show the valuation for the purpose of pecuniary jurisdiction by taking into consideration value of the service + claim amount.  If the value of service of Rs.20,00,000/- + claim of Rs.11,40,835/- are taken into consideration, the then District Forum had no pecuniary jurisdiction to entertain the complaint.  On the date of filing the complaint, the pecuniary jurisdiction of the District Forum was up to Rs.20,00,000/-, whereas pecuniary jurisdiction of Hon’ble State Commission was up to Rs.1 crore.  The complaints are being filed before the District Forum to have the benefit of Appeal facility before Hon’ble State Commission.  This attitude is the brain child of the advocate who is the architect of the complaint. On the date of filing the complaint, the complainant was supposed to show the correct valuation for the purpose of pecuniary jurisdiction or the then District Forum was supposed to verify what was valuation for the pecuniary jurisdiction immediately after filing the complaint.  Mere admission of complaint and issuance of notice, does not give jurisdiction either to District Forum or District Commission.
14. We are of the opinion that on the date of filing the complaint, District Forum had no pecuniary jurisdiction where the value + claim was more than Rs.20,00,000/-.  Under such circumstances, this complaint was supposed to be filed before Hon’ble State Commission.

1. 2018 (2) CPR 111 in the matter between Gurmukh Singh Vs. Greater Mohali Area Development Authority and another. The Honb’le National Commission referring the earlier judgement of Larger Bench in Ambrish Kumar Shukla and others Vs. Ferrous Infrastructure Pvt. Ltd.,, wherein it was held in para 6 which read thus:-

Para 6:- A three-member bench of this Commission in their order on 07.10.2016, stated as under on the issue referred above:-

It is the value of the goods or services as the case may be, and not the value or cost of removing the deficiency in the service which is to be considered for the purpose of determining the pecuniary jurisdiction.

2. III (2018) CPJ 370 (NC) in the matter between Renu Singh Vs. Experion Development Pvt. Ltd., where in it is held that “Consumer Protection Act, 1986 Sections 29(1)(g), 21(a)(ii) – Pecuniary jurisdiction – booking of residential unit – builder-buyer agreement – Terms and conditions not agreed upon, Refund of deposited amount sought, alleged deficiency in service – State Commission dismissed complaint – Hence, appeal value of unit itself is Rs.1,28,84,474/- - Pecuniary jurisdiction in complaint is not before the State Commission but it is before the National Commission – No perversity in well reasoned order passed by State Commission.

15. The C.P.Act, 2019 is come into force w.e.f. from 20.07.2020.  The present complaint came to be filed on 06.07.2020 before effective date of new enactment.  The question arises whether this complaint can be continued before this Forum.  We are of the opinion that the complaint filed under Section 1986 cannot be continued under new C.P.Act, 2019.
16. This reasoning of us is supported by the decisions decisions of the Hon’ble Supreme Court of India and Hon’ble National Commission:-

2021 (2) CPR 398 in the matter of Neena Aneja Vs. Jain Prakash Associates Ltd., dated 16^th March, 2021.  It  is relevant to refer to para 71 of the judgement which read thus:-

71. For the above reasons, we have come to the conclusion that proceedings instituted before the commencement of the Act of 2019 on 20 July 2020 would continue before the fora corresponding to those under the Act of 1986 (the National Commission, State Commissions and District Commissions) and not be transferred in terms of the pecuniary jurisdiction set for the fora established under the Act of 2019.  While allowing the appeals, we issue the following directions:

(i) The impugned judgement and order of the NCDRC dated 30 July 2020 and the review order dated 5 October 2020, directing a previously instituted consumer case under the Act of 1986 to be filled before the appropriate forum in terms of the pecuniary limits set under the Act of 2019, shall stand set aside;

(ii) As a consequence of (i) above, the national Commission shall continue hearing the consumer case instituted by the appellants;

(iii) All proceedings instituted before 20 July 2020 under the Act of 1986 shall continue to be heard by the fora corresponding to those designated under the Act of 1986 as explained above and not be transferred in terms of the new pecuniary limits established under the Act of 2019 and

iv) The respondent shall bear the costs of the appellant quantified at Rupees two lakhs which shall be payable within four weeks.

17. In view of the above dictum, the District Commission cannot continue or has no power to continue the proceedings initiated under C.P.Act, 1986 and under new C.P.Act, 2019.  The complaint requires to be returned the complainant for presentation before Hon’ble State Commission.
18. Point Nos.2 and 3:- It is settled proposition of law that when the authority has no pecuniary jurisdiction, it has no power to decide the case on merits.  Under such circumstances, these two points do not survive for consideration.   
19. Point No. 4:- In view of the discussion made in the preceding paragraph, the complaint requires to be returned to the complainant for presentation before the Hon’ble State Commission, Bengaluru.   Hence, we proceed to pass the following

  O R D E R

1. The complaint was not maintainable under C.P.Act, 1986 for want of pecuniary jurisdiction and this complaint cannot be continued under new C.P.Act, 2019.
2. Return the complaint to the complainant for presentation before the Hon’ble State Commission, Bengaluru.
3. Furnish the copy of this order to both parties as per law.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Commission on this 29^th day of March, 2022)

Documents produced by the Complainant which are as follows:-

Documents produced by the OPs which are as follows:-