Punjab

Ludhiana

CC/20/159

M/s Bajaj Knits - Complainant(s)

Versus

Punjab National Bank - Opp.Party(s)

Arun Bagga

16 Feb 2024

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, LUDHIANA.

                                                Complaint No:159 dated 01.09.2020.                                                         Date of decision: 16.02.2024.

 

M/s. Bajaj Knits, through its Proprietor Dinesh Kumar, Bajaj Building, B-IV-1579, Katra Nauhrian, Ludhiana.                                                                                                                                                      ..…Complainant

                                                Versus

1. Punjab National Bank, through its Chief Manager, Civil Lines, Ludhiana.
2. Punjab National Bank, through its Divisional Manager, Divisional office, Nr. West End Mall, Ferozepur Road, Ludhiana.

…..Opposite parties 

Complaint Under section 35 of the Consumer Protection Act, 2019.

QUORUM:

SH. SANJEEV BATRA, PRESIDENT

MS. MONIKA BHAGAT, MEMBER

 

COUNSEL FOR THE PARTIES:

For complainant             :         Sh. Yogesh Gandhi, Advocate.

For OP                           :         Sh. Vyom Bansal, Advocate.

 

ORDER

PER SANJEEV BATRA, PRESIDENT

1.                Briefly stated, the facts of the case are that the complainant, a proprietorship concern of Sh. Dinesh Bajaj was having a CC account with the OPs bearing account No.0297008700007266. On 30.10.2018, an amount of Rs.169,389/- was debited from the said account on account of CGTMSE renewal fee despite debit of amount of Rs.47,438/- on 11.05.2017. The complainant vide letters dated 31.12.2018, 14.02.2019, 28.05.2019, 06.06.2019, 22.11.2019, 02.02.2020 and through personal visited, requested and apprised the OPs regarding deduction of huge amount from CC account without intimation and permission, but despite that the OPs never apprised the complainant about CGTSME charges, deducted without its consent. The complainant further stated that it requested the Ops to continue with the CC limit account against any collateral security or against Fixed Deposit already lying with them but they never paid any heed to its requests. Even the complainant never agreed to pay such huge fee in any condition but the OPs unilaterally and arbitrarily charged a huge amount from its account which amounts to negligence, deficiency in service and unfair trade practice on their part due to which the complainant has suffered mental pain, agony, harassment and financial loss entitling the complainant for compensation of Rs.5,00,000/- from the OPs. The complainant served a legal notice dated 26.06.2020 upon the OPs through registered post dated 30.06.2020 but to no effect. Hence this complaint, whereby the complainant has prayed for directing the OPs to refund the amount of Rs.1,69,389/- along with interest and compensation of Rs.5,00,000/- besides litigation expenses of Rs.22,000/-.

2.                Upon notice, the opposite parties filed joint written statement and assailed the complaint by taking factual submission and preliminary objections on the ground of maintainability of the complaint, lack of cause of action; lack of jurisdiction; the complaint being barred under the Consumer Protection Act; concealment of true facts etc. The opposite parties stated that the complainant through OP1 was enjoying a Cash Credit Limit of Rs.55 Lacs under the Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) set up by Government of India and accepted the loan under CGTMSE after having through understanding, complainant accepted the terms of sanction letter and conveyed his acceptance vide acceptance letter dated 05.12.2014.  The complainant was using the CC limit for commercial purpose. The OPs further averred that Annual Guarantee Fee (AGF) was charged by CGTMSE and as per the guidelines set by the Fund yearly deduction towards the contribution was deducted from the account of the borrower for onward remittance to the fund. The renewal fee for CGTMSE for the years 2018 for the complainant loan account was Rs.55 lacs and OPs duly apprised the complainant of the CGTMSE charges and its calculation vide letter dated 11.03.2020. According to the OPs, they have made the deductions towards the CGTMSE fee as per the circular issued and thus have provided full services to the complainant.

                   On merits, the opposite parties reiterated the crux of averments made in the preliminary objections. However, the OPs admitted the charging of Rs.1,69,389/- as CGTMSE charges, the calculation of which was duly apprised by them to the complainant vide letter dated 11.03.2020.  The opposite parties have denied that there is any deficiency of service and have also prayed for dismissal of the complaint.

3.                The complainant filed replication to the amended written statement reiterated the facts mentioned in the complaint and controverted those mentioned in the written statement.

4.                In support of his claim, Sh. Dinesh Kumar, Proprietor of the complainant firm tendered his affidavit Ex. CA in which he reiterated the allegations and the claim of compensation as stated in the complaint. The complainant also tendered documents Ex. C1 is the copy of registration certificate, Ex. C2 and Ex. C3 are the copies of Annexure-A and
Annexure-B respectively, Ex. C4 is the copy of statement w.e.f. 01.10.2018 to 31.10.2018, Ex. C5 is the copy of statement w.e.f. 01.05.2017 to 31.05.2017, Ex. C6 to Ex. C10, Ex. C12 are the copies of  letters dated 31.12.2018, 14.02.2019, 28.05.2019, 06.06.2019, 22.11.2019, 02.02.2020 for reversal/refund of fee, Ex. C11, Ex. C13, Ex. C15, Ex. C16 are the copies of postal receipts, Ex. C14 is the copy of legal notice dated 26.06.2020 and closed the evidence.

5.                On the other hand, counsel for the opposite parties tendered affidavit Ex. RA of Ms. Veenu Singla, Branch Manager of the opposite parties along with documents Ex. R1 is copy of acceptance letter, Ex. R2 is the copy of circular of Bank regarding CGTMSE, Ex. R3 is the copy of statement of loan account of the complainant, Ex. R4 is the copy of letter dated 11.03.2020 and closed the evidence.

6.                We have heard the arguments of the counsel for the parties and also gone through the complaint, rejoinder, affidavit and annexed documents and written reply along with affidavits and documents produced on record by both the parties.

7.                Admittedly, the complainant firm, a CC account holder with the OPs had availed Cash Credit Limit of Rs.55,00,000/- under Credit Guarantee Fund Trust for Micro and Small Enterprises (CGTMSE) set up by Government of India. The terms as mentioned in the sanction letter dated 05.12.2024 Ex. R1 were accepted by the complainant firm. The complainant firm was duly aware of the fact that CGTMSE charges are such as Annual Guarantee Fee (AGF) is payable. An amount of Rs.47,438/- was deducted on 11.05.2017 on account of CGTMSE fee. However, when the amount of Rs.1,69,389/-  was deducted, the complainant raised protest though letters dated 31.12.2018, 14.02.2019, 28.05.2019, 06.06.2019, 22.11.2019, 02.02.2020 (Ex. C6 to Ex. C10 And Ex. C12) addressed to the OPs and Banking Ombudsman, Chandigarh and claimed that a hefty amount more than 3.5 times was imposed as renewal charges without prior intimation to the complainant is illegal, more so when the FDR of Rs.60,00,000/- is with the OP bank which could have been treated as security. The bank relied upon levying of charges strictly in accordance with circular No.53/2018 dated 15.09.2018 Ex. R2. During the course of arguments, the counsel for the OPs also placed  page 17 of its updated version dated 06.01.2022 to butterace  its claim. The extract of Annual Guarantee Structure of scheme is reproduced as under:-

Credit Facility	Annual Guarantee Fee (AGF) [% p.a.]
	Women, Micro Enterprises and Units Covered in North East Region	Others
Above Rs.50 Lakhs and Up to Rs.200/- Lakhs	1.80% + Risk Premium as per extant guidelines of the Trust

 

	2019-2020
Risk Premium	45% of SR

 

8.                During the course of proceedings before Banking Ombudsman, OPs had also relied its reply (Ex. R4)  to the complaint of the complainant firm, the operative part of which reads as under:-

“With reference to above complaint, a meeting with your good self was held at ours today on 11.03.2020. During the meeting, we have apprised you the facts related to deduction of CGTMSE. Details of charges debited is as under:-

Working Capital amount                                                Rs.55.00 Lacs

CGTMSE AGF Fee – 1.8% of the Exposure =      Rs.99000/- (as per                                                                                                page Exposure No.10                                                                                 of the circular                                                                                              enclosed)

          (If exposure is above Rs.50 Lacs and upto 200 Lacs)

Risk Premium 45% of Fee                           =       Rs.44550/- (as per                                                                                                page N.11 of the                                                                                        circular exposed)

          Total Fee                                                    =       Rs.1,43,550/-

          Total fee with GST 18%                              =       Rs.1,69,389/-

          As per your request, we are providing relevant circular of CGTMSE on      the basis of which the deduction as made, along with this letter. We hope that you will be satisfied with the amount charged by the bank, as agreed      during the meeting that if charges will be according to Govt. agency you        will drop the matter and will not insist for refund of charges debited.

          Moreover, bank has already acceded to your request and has got the a/c    collaterally covered and no further CGTMSE fee will be charged from      your account.”

It can be inferred from the reply Ex. R4 that a tentative settlement was reached out between the parties hereto whereby accepting to the request of the complainant, an account was collaterally covered and no further CGTMSE fees was payable from the account of the complainant. Even otherwise, the complainant had been paying the charges including the said CGTMSE even in the past. The complainant has not referred to any document which prescribes the service of prior notice to the complainant before levying CCGTMSE charges. In the absence of such stipulation, the presumed compliance is not expected from the OP bank. The OP bank acted as per mandate of law and contractual obligations and as such, there is no deficiency or adoption of unfair trade practice on their part.

9.                Considering from another angle, the complainant firm was maintaining a current account and availed facilities for the purpose of generating profits. The complainant neither in his complaint nor in his affidavit or rejoinder has stated that the firm was carrying business for the purpose of its livelihood. The Hon’ble Supreme Court in its judgment Shrikant G. Mantri Vs Punjab National Bank in Civil Appeal No.11397 of 2016 vide its decision dated 22.02.2022 made the following observations:-

“33. It could thus be seen that this Court has clearly held that the idea of enacting the said Act was to help the consumers get justice and fair treatment in the matter of goods and services purchased and availed by them in a market dominated by large trading and manufacturing bodies. It has been held that the entire Act revolves round the consumer and is designed to protect his interest. It provides for “business ­to­ consumer” disputes and not for “business­ to­ business” disputes. It has been held that forums/commissions provided by the said Act are not supposed to supplant but supplement the existing judicial system. The idea was to provide an additional forum providing inexpensive and speedy resolution of disputes arising between consumers and suppliers of goods and services.

47. In the present case, the Commission has come to a finding that the appellant had opened an account with the respondent­ Bank, took overdraft facility to expand his business profits, and subsequently from time to time the overdraft facility was enhanced so as to further expand his business and increase his profits. The relations between the appellant and the respondent is purely “business to business” relationship. As such, the transactions would clearly come within the ambit of ‘commercial purpose’. It cannot be said that the services were availed “exclusively for the purposes of earning his livelihood” “by means of self­ employment”. If the interpretation as sought to be placed by the appellant is to be accepted, then the ‘business to business’ disputes would also have to be construed as consumer disputes, thereby defeating the very purpose of providing speedy and simple redressal to consumer disputes.”

 So applying the ratio of above cited case, the complainant is not a consumer of the opposite parties within purview of Section 2(7) of the Consumer Protection Act and as such, the complaint is liable to be dismissed and the same is hereby dismissed.

10.              As a result of above discussion, the complaint is hereby dismissed being devoid of any merits. However, there shall be no order as to costs. Copies of order be supplied to parties free of costs as per rules. File be indexed and consigned to record room.

11.              Due to huge pendency of cases, the complaint could not be decided within statutory period.

 

(Monika Bhagat)                                       (Sanjeev Batra)

Member                                                     President    

 

Announced in Open Commission.

Dated:16.02.2024.

Gobind Ram.