JUSTICE SUDIP AHLUWALIA, MEMBER

         The present Revision Petition under Section 21 of Consumer Protection Act, 1986 has been filed by Canara Bank against the impugned Order dated 29.09.2021 passed by the State Consumer Disputes Redressal Commission, Punjab  in First Appeal No. 745 of 2019 vide which the Appeal filed by the Petitioner was dismissed.

2.      Brief facts of the case as per the Complaint are that Piyush Tripathi is the son of Surinder Tripathi. For the higher study of Complainant No. 1, the Complainant No. 2 raised an Educational loan of ₹7,50,000/- from the Union Bank of India. The gross annual income of the Complainants and their family is Rs.3,40,000/-. The Central Govt. of India launched an Interest Rate Subsidy Scheme for education loan for students who belong to Economically Weaker Section (EWS).  Under the Scheme, the Govt. of India was to provide “full interest subsidy” during the period of moratorium which is defined as the course period plus one year or six month after getting job. The Subsidy Scheme was applicable from the academic year 2009-10 as per guidelines of Central Govt. The Complainant No. 1 being borrower along with the Complainant No. 2 being co-borrower raised the Educational loan of Rs.7,50,000/- for study purpose of B.Tech (Electrical Engineering) in Thapar University, Patiala, vide application dated 23.06.2014. After completion of the loan formalities, the Union Bank of India disbursed the instalment amount of Rs.1,25,000/- on 24.06.2014. The other instalment amounts were disbursed on different dates i.e. 02.01.2015, 14.07.2015, 01.01.2016, 16.07.2016 and 16.12.2016. At the time of disbursing the aforesaid loan amount, the Respondent No. 3/Bank assured the Complainants that they will charge the interest on the educational loan as per norms of RBI and Central Govt. The Respondent No. 3/Bank fixed the repayment instalment of said loan to the amount of Rs.16,000/- and the Complainants are paying the same regularly to them.

3.      In the month of April 2019, the Complainants came to know of the Scheme of the Central Govt. that provides “full interest subsidy”. The Complainants then obtained statement of their loan account on date 03.04.2019, wherein the Respondent No. 3 Bank did not provide them the interest subsidy as per Scheme of the Central Govt.  As such, the Respondent No. 3/Bank violated the fair trade practice and committed deficiency of service causing large monetary loss to the Complainants. It is alleged that the Respondent No. 3/Bank did not provide the subsidy because of their malafide intentions. The Complainants then approached the Respondent No. 3/Bank to provide the subsidy but the Respondent No. 3/Bank did not pay any heed to their request.  On the other hand, it  demanded Income Certificate from the Complainants, in compliance of which the Complainant No. 2 provided such Certificate dated 06.02.2018 which was issued by Tehsildar Nawashahr. The Respondent No. 3/Bank was approached by the Complainants repeatedly but they flatly refused to admit the claim of the Complainants. The Complainant No. 1 completed his degree of B.Tech in July 2017 and as such the Respondent No. 3/Bank should have provided the interest subsidy as per the Scheme of the Govt. of India. The Petitioner Bank herein was the nodal Bank for educational loans, and hence their impleadment was necessary.

4.      Aggrieved by the act of the Union Bank of India and Canara Bank, the Complainant filed a Complaint before District Consumer Disputes Redressal Commission, Shaheed Bhagat Singh (SBS) Nagar (hereinafter referred to as “District Commission”) praying for being provided the benefit of the scheme of the Govt. of India and also claimed damages for mental agony and cost of litigation.

5.      The District Commission vide its Order dated 09.10.2019 partly allowed the Complaint. The relevant extracts from the Order of the District Commission are set out as below-

“7. Resultantly, keeping in view the facts and circumstances of the case discussed above and record produced on file, we partly allow the present Complaint with direction to OPs to provide the benefit of Central Sector Interest Subsidy Scheme, 2009 Ex.C-18 and amount of the same be adjusted in the loan account of Complainant. Further, the OPs are directed to pay Rs. 5,000/- as compensation and Rs. 3,000/- as litigation expenses.

8. The compliance of this Order shall be made by OPs jointly and severally within 30 days of the receipt of the certified copy of the Order.

9. Let copies of the Order be sent to the parties, as permissible, under the rules.”

6.      Aggrieved by the Order of the District Forum, the Petitioner herein filed Appeal before the State Commission. The Petitioner prayed for setting aside the Order. The State Commission dismissed the Appeal of the Petitioner herein vide Order dated 29.09.2021. The relevant extract of the Order of the State Commission is reproduced hereunder-

“16. Accordingly, we do not find any merit in the contentions raised by learned counsel for the appellants-Banks and both the appeals i.e First Appeal No. 180 of 2020 and First Appeal No. 745 of 2019 are dismissed being devoid of any merit…”

7.      Aggrieved by the Order of the State Commission, the Petitioner filed the present Revision Petition raising the following issues-

i)    That the State Commission erred in not appreciating that there was no relationship of consumer and service provider between the Complainant and the Petitioner. No agreement whatsoever existed between them;

ii)   That the State Commission failed to consider the specific terms and conditions subject to which the Petitioner Bank was given the responsibility of acting as a nodal Bank for the purposes of interest subsidy scheme. The State Commission failed to appreciate that the Petitioner was not involved in any manner in accepting or rejecting the interest subsidy claim made before the Union Bank of India;

iii)  That the State Commission ignored the question of law involving the interpretation and effect of the Govt. scheme and the agreement between the parties and;

iv) That the State Commission failed to appreciate that the Complainant had not raised any grievances against the Petitioner in his Complaint.

8.   The Ld. Counsel for Petitioner/Bank argued that the State Commission exercised its jurisdiction illegally and with material irregularity because it failed to appreciate that there was no relationship of consumer and service provider between the Complainant and Petitioner herein. The Petitioner Bank neither received any application of the Complainant nor rejected any claim made by them.  In the present case, the Complainants  approached the Union Bank of India / Respondent No. 3 for the Education loan. The Respondent No. 3 never sent any claim of Interest Subsidy of the Complainants to the Petitioner Bank. There was no privity of contract between the Petitioner and the Complainants. The Section 2(1)(d) of the Act defines “Consumer” and according to the said definition the Complainant is not a consumer of the Petitioner because he did not avail any service from the Petitioner for a consideration. There is no question of deficiency of service as there was no contract or any other relationship between the Complainants and the Petitioner Bank. The Ld. Counsel for the Petitioner further argued that the State Commission ignored the question of law involving the interpretation and effect of the Govt. scheme and the Agreement between Ministry of Human Resource Development (MHRD) and the Petitioner Bank regarding the implementation of Interest Subsidy Scheme. The impugned Order completely ignored the relevant parts of the Agreement between MHRD and Petitioner Bank regarding administration of the Interest Subsidy Scheme. The impugned Order thus suffers from illegality and material irregularity and therefore should be set aside with costs.

9.      The Ld. Counsel for Complainants has argued that the unlawful act of the Respondent Nos. 3-5 (Union Bank of India) caused a great mental agony and physical harassment due to their act of not giving the Complainants the benefit of the scheme of the Govt. of India. The Respondent Nos. 3-5 are liable to be directed to recalculate the interest on the loan taken by the Complainants and provide “full interest subsidy” and “subsidy on interest @1%” from the date of disbursement of aforesaid educational loan to till date. The Complainants had severally approached the Union Bank of India both verbally and in writing and requested them to accept the claims of the Complainants but they refused to accept the legal demands of the Complainants. The conduct of the Union Bank of India is highly irresponsible and amounts to deficiency in services. The Respondent Nos. 3-5 had also filed an Appeal before the State Commission which was dismissed. The Petitioner Bank herein is a nodal Bank for the educational loans and therefore they are jointly and severally liable along with the Union Bank of India for compensation. The nodal Bank is also duty bound to implement the policy of the Govt. of India and its implementation. The conduct of the Petitioner Bank shows that they are not performing their duties being the nodal Bank and are not checking the Banks and educational loans as granted by them to weaker section of the society. The Petitioner Bank has also failed to disclose about the action taken by it against the Bank officials who have committed the default. The Complainants submitted the annual Income Certificate upon the request of Respondent No. 3 but despite the submission the Respondent no. 3 failed to take any further action. There are audits of all kinds of Bank accounts by the auditors of the Banks, but despite that none has raised any kind of objection on non-granting of subsidy to the Complainants. The Petitioner Bank has never denied its negligence. If any Bank does not provide subsidy, then the nodal Bank is duty bound to report the matter to Head Office of concerned Bank or Ministry of Finance or Reserve Bank of India. The Petitioner Bank cannot escape from liabilities being nodal Bank.   The Ld. Counsel for Complainants further argued that the Petitioner Bank has no locus standi to file the present Revision Petition as they have not approached this Commission with clean hands and are guilty of supressing the real, material and true facts. The present Revision Petitioner is hit by the  principle of estoppel; it is a well-established principle of law that if a person does not come before the Court with clean hands, he would not be entitled for any discretionary relief.  The present Revision Petition is therefore untenable.

10.    The grievance of the Petitioner/Bank is that it could not have been saddled with any liability for the omission on the part of Respondent Nos. 3 to 5 representing Union Bank of India, as it was only a Nodal Agency for the purpose of administering the “Central Sector Interest Subsidy” (CSIS) Scheme, and its role was limited to consolidating the subsidy scheme and for forwarding the same to the Ministry of H.R.D.  Nevertheless, an adverse inference has been drawn against the Petitioner which had nothing to do with deciding the amount of subsidy and entitlement of the Complainants/Respondents, and was in no way at fault.

11.    Attention in this regard has been specifically invited to the relevant clauses of the Memorandum of Understanding executed between the Petitioner/Bank and Government of India, Ministry of H.R.D., on 5.3.2015 for the purpose of smooth implementation of the aforesaid Interest Subsidy Scheme. In Clauses 7 & 8 of the aforesaid Memorandum of Understanding, it was specifically provided as under –

“7.       Canara Bank shall have no obligation to verify whether the interest subsidy claims received from Banks, other than that of Canara Bank, are as per the Scheme or eligibility of the students of its authenticity, but to submit the said claims to MoHRD without delay. However, Canara Bank, at its sole discretion, may request the Banks to submit a Certificate signed by the Top Management Official of the concerned Bank certifying the eligibility and authenticity of the claims submitted by them to enable Canara Bank to forward the same to MoHRD alongwith claims.

8.         In case of any clarification/documents required in respect of any claim submitted by Banks, MoHRD shall take up with the respective Banks who have sanctioned the loan and submitted their claim for interest subsidy. Canara Bank shall have no obligation to get such clarification/documents from Bank/s, except for its own claims.””

12.    It is, therefore, seen that the Government of India which had appointed the Petitioner Bank as the Nodal Agency for smooth implementation of the Scheme had itself exempted the Petitioner from any obligation to verify the Interest Subsidy Schemes received from any Bank other than the Petitioner/Bank itself, and that in the case of any clarification, if so required, it was for the Ministry of H.R.D. itself to take up the issue with the concerned Banks sanctioning the loan, and even for that purpose, there was no obligation upon the Petitioner/Bank to get any such clarification/documents from any other Bank except those pertaining to its own claims.

13.    Clearly, therefore, while admittedly the Respondent Nos. 1 & 2 i.e. the Complainants did have an actionable case against the Union Bank of India for its omission to faithfully follow the Interest Subsidy Scheme, both the Ld. Fora below had acted erroneously in saddling liability upon the Petitioner Bank for the omission on the part of the Union Bank of India, simply because it was the Nodal Agency for the purpose of the Interest Subsidy Scheme, even though the Memorandum of Understanding from which it had derived its authority, had itself exempted the Petitioner Bank from any such liability.

14.    For the aforesaid reasons, the present Revision Petition is allowed after modifying the impugned Orders of the Ld. Fora below to the extent that the Order passed by the Ld. District Forum, SBS Nagar, against the original Opposite Parties, and subsequently affirmed by the Ld. State Commission shall be operative only against the first three Opposite Parties i.e. the present Respondent Nos. 3,4 & 5, and shall not operate as against the present Petitioner which was the Opposite Party No. 4 in the original complaint.

15.    Parties to bear their own costs.

16.    Pending application(s), if any, also stand disposed off as having been rendered infructuous.