KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION
VAZHUTHACAUD, THIRUVANANTHAPURAM
C.C. No.23/2008
JUDGEMENT DATED: 31.01.2023
PRESENT:
HON’BLE JUSTICE SRI. K. SURENDRA MOHAN | : | PRESIDENT |
SRI. AJITH KUMAR D. | : | JUDICIAL MEMBER |
SRI. K.R. RADHAKRISHNAN | : | MEMBER |
COMPLAINANT:
| Kerala State Beverages (Manufacturing & Marketing) Corporation Ltd., Thiruvananthapuram represented by its Managing Director |
(by Adv. S. Sreekumaran Nair)
Vs.
OPPOSITE PARTY:
| The Chief Manager, State Bank of India, Thiruvananthapuram |
(by Adv. S. Williams)
JUDGEMENT
SRI. AJITH KUMAR D. : JUDICIAL MEMBER
This is a complaint filed under Section 12 of the Consumer Protection Act, 1986 by the Managing Director of Kerala State Beverages Corporation Ltd., Thiruvananthapuram alleging deficiency in service and unfair trade practice against the Chief Manager, State Bank of India, Thiruvananthapuram.
2. The averments contained in the complaint in short are as follows:
The complainant is a state owned company incorporated under the Indian Companies Act conducting the monopoly business of manufacturing, purchase and sales of Indian made foreign liquor and beer in the State of Kerala. The Corporation had a current account facility with various branches of the opposite party. The funds mobilised at various outlets of the complainant are being transacted through the designated Bank. The standing instructions duly confirmed by the designated branches include collection of funds realised at the units and transfer of the same to the main branches at Thiruvananthapuram where the head office of the Corporation is situated on a daily basis without levying Bank charges or transfer charges.
3. Certain branches, without adhering to the standing instructions had debited transfer charges/bank charges on the complainant to the tune of Rs.47,23,595/-(Rupees Forty Seven Lakhs Twenty Three Thousand Five Hundred and Ninety Five only) for the period from 2001-2002 to 2004-2005. The complainant had sent various letters requesting the senior officials of the opposite party to refund the Bank charges but the request was not complied with. So the complainant had filed a complaint before the Banking Ombudsman for resolving the issue. The Banking Ombudsman had declined to entertain the complaint for the reason that the claim exceeds their pecuniary jurisdiction. Against the above order, the complainant had preferred an appeal before the Deputy Governor of the Reserve Bank of India, Mumbai which was returned with a liberty to the complainant to approach any grievance redressal forum for the reason that the Banking Ombudsman Scheme, 2006 does not contemplate a provision for an appeal. In the above circumstances, this complaint has been filed.
4. The complainant had sought for a direction to refund Rs.47,23,595/-(Rupees Forty Seven Lakhs Twenty Three Thousand Five Hundred and Ninety Five only) being the amount unauthorisedly debited as Bank charges from the account of the complainant.
5. On admitting the complaint, notice was issued to the opposite party who filed a written version with the following contentions:
The complaint as framed is not maintainable either in law or on facts. The subject matter of the complaint being the refund of collection charges levied by the bank during the period from 2001-2002 to 2004-2005, the complaint is barred by limitation.
6. The complainant is not a consumer of the opposite party and there is no consumer dispute or deficiency in service as defined in the Consumer Protection Act. The complainant had suppressed material facts. The complainant had opened a collection account with the opposite party agreeing to the Bank’s usual terms and conditions. Similar collection accounts were opened with designated banks at various places. The complainant, as per the letter dated 03.05.2001 had requested the Bank not to levy any charges on their accounts. But the bank had never agreed to the said request at any point of time. The request of the complainant for waiving collection charges cannot be treated as a standing instruction. Even if there is a standing instruction, it would not bind the opposite party unless and until the said request has been accepted by the opposite party. The opposite party had made it clear to the complainant that it was not willing to waive collection charges. The opposite party is a commercial organisation functioning in a highly competitive atmosphere. Collection and remittances of funds is one of the services rendered by the Bank for a consideration. The action of the opposite party in collecting collection charges is perfectly legal and in accordance with the norms of the Bank. The complainant had continued the account till 2005 despite collection of remittance charges by the bank which fact would also establish that the complainant had accepted the terms and conditions of the Bank for maintaining the aforesaid account and as such the complainant is estopped from claiming refund of charges from now.
7. Collection charges is required in view of the volume of work involved in respect of the transactions pertaining to the accounts of the complainant. the opposite party had made it clear to the officials of the complainant that it was not possible to waive the collection charges. There is no deficiency in service. The opposite party would seek for the dismissal of the complaint.
8. The evidence consists of the testimony of PW1 and Exhibits A1 to A9 on the side of the complainant. RW1 was examined on the side of the opposite party. Exhibits B1 to B4 were also marked. Written notes of argument were filed by the lawyers appearing for both sides.
9. Heard both sides. Perused the records.
Now the points that arise for consideration are:
- Whether the complainant is a consumer as contemplated in the Consumer Protection Act?
- Whether there is any deficiency in service or unfair trade practice?
- Whether the complainant is entitled to get a direction against the opposite parties for refund of the amount as claimed?
- Reliefs and costs?
Points 1 to 3
10. These points are considered together as the facts are interlinked. PW1 is the Finance Manager of the complainant who spoke before the Commission in tune with the averments contained in the complaint. Exhibit A1 is the copy of a communication dated 03.05.2001 issued by the Managing Director of the complainant to the Manager of State Bank of India, M.G. Road, Trivandrum with respect to the operation of the accounts pertaining to the complainant. It is stated that as per the standing instruction issued by the complainant to the State Bank of India no transfer charges or any other charges should be levied on the account. Exhibit A2 series are the particulars with respect to the collection of charges made by certain branches of the State Bank of India from the account of the complainant. Exhibit A3 series are the copies of the subsequent communications sent by the Finance Manager of the complainant to the opposite party for adhering with the stipulations contained in the standing instruction that no collection charges could be levied. Exhibit A4 is the copy of a letter dated 22.02.2007 issued by the Managing Director of the complainant to the Chief General Manager of the opposite party requesting to abide by the stipulations contained in the standing instruction with regard to the collection of Bank charges. It was also requested for settlement of the dispute. Since the dispute could not be resolved, the complainant had filed a complaint before the Banking Ombudsman the copy of which is exhibited as A5. The Banking Ombudsman as per the letter dated 30.04.2007 had closed the complaint since the subject matter of the complaint exceeds the pecuniary jurisdiction of the Banking Ombudsman which is exhibited as A6. Being aggrieved by the aforesaid order the complainant had filed an appeal before the Reserve Bank of India. But the appeal was dismissed as per the order dated 06.09.2007 marked as Exhibit A7 stating that no provision is incorporated in the Banking Ombudsman Scheme for entertaining an appeal. Exhibit A8 is the authorisation issued by the Manging Director in favour of PW1, the Finance Manager to swear to affidavits and to adduce evidence in these proceedings. Exhibit A9 is the certificate issued by the Assistant General Manager, Commercial Branch, State Bank of India dated 31.12.2013 that the current account in the name of the complainant is alive with a balance of Rs.5,955.95/-(Rupees Five Thousand Nine Hundred and Fifty Five & Ninety Five Paise only) as on 31.12.2013.
11. As against the evidence let in by the complainant, the Branch Manager of the opposite party was examined as RW1. Exhibit B1 is a letter dated 27.10.2001 issued by the Branch Manager of Attingal Branch of State Bank of India requesting the complainant to cause production of any correspondence from the Trivandrum Branch with respect to any concession facilities availed by the complainant. Exhibit B2 is a letter dated 15.03.2006 issued by the Assistant General Manager of the Bank in response to the claim for refund. It is further clarified that the complainant should cause production of any correspondence with regard to the concession in dispensing with the collection charges if any passed by the Bank. Exhibit B3 is a correspondence dated 21.05.2007 that the collection charges was not unauthorised and it is not possible for the Bank to refund the charges collected. Exhibit B4 is a letter dated 12.07.2007 by the General Manager wherein it is reiterated that collection charges was levied in accordance to the guidelines issued by the Bank. The claim raised by the complainant was closed since the Ombudsman had also declined to entertain the complaint raised by the complainant.
12. In the notes of argument, the learned counsel for the complainant had placed reliance on the ruling of the Apex Court reported in (2009) 3 SCC 240 Karnataka Power Transmission Corporation & Anr. Vs. Ashok Iron Works Private Limited. As per the interpretation given by the Hon’ble Supreme Court the word “person” contained in Section 2(1)(d) read with 2(1)(m) of the Consumer Protection Act is an inclusive definition and it is not an exhaustive one. The Hon’ble Supreme Court was inclined to decide that a company would also come within the definition of the “person” as contained in Section 2(1)(m) of the Consumer Protection Act. So according to the complainant, the company can maintain a complaint before the Consumer Protection Authority.
13. The opposite party had raised a contention that the transaction involved in this case is for a commercial purpose and hence no consumer dispute would arise. In answer to the above contention, the learned counsel for the complainant would submit that in the written version filed by the opposite party there is no pleadings to the effect that the transaction involved in this case is for commercial purpose and as long as such a pleading is absent the opposite party cannot raise objection at the stage of evidence or argument. According to the learned counsel, evidence could be let in to substantiate the pleadings put forth and no evidence could be looked into if such plea was not incorporated in the written version. The learned counsel had cited a decision of the National Commission reported in Vinod Kumar Vs. Punjab State Electricity Board & Ors. III (2011) CPJ 194 (NC), M/s Harsolia Motors Vs. M/s National Insurance Co. Ltd. & Ors. 2005 Vol. 1 CPR 1 (NC). In the second decision referred above is a case in which a commercial establishment had availed insurance policy in respect of the units and it was found that the transaction was not directly related to the trade.Here the situation is entirely different.
14. The argument advanced by the complainant in this regard does not appear to be convincing for the reason that admitted facts need not be proved. In the first paragraph of the complaint, it is clearly admitted that the complainant is conducting the monopoly business of manufacturing, purchase and sales of IMFL and beer in the State of Kerala. The transaction between the complainant and the opposite party has been discussed in the third paragraph of the complaint as follows:
“The funds mobilised at various outlets of the complainant corporation are transacted through designated banks. The standing instructions duly confirmed by the designated banks include collection of funds realised at the units and transfer of the same to the main branch at Thiruvananthapuram where the head office of the corporation is situated on a daily basis without charging transfer charges or bank charges”.
15. So there is clear pleadings in the complaint that the complainant is doing a commercial activity and thus transaction between the complainant and the opposite party is in the process of the commercial activity. In Section 2(1)(d) while defining a “consumer” an exclusion is incorporated “purchase or service does not include a person who obtain such goods for sale or for any commercial purpose”. An explanation is also contemplated that commercial purpose does not include “use by a person of goods, bought and used by him exclusively for the purpose of earning his livelihood by means of self-employment”. So it is the initial duty of the complainant to satisfy as to how a complaint in respect of commercial transaction is maintainable before a Consumer Forum. In the written version filed by the opposite party there is clear pleadings that the complainant is not a consumer as contemplated under the provisions of the Consumer Protection Act. Admittedly, the complainant is a Company doing commercial activities and the transactions alleged in this case is in relation to the commercial activity. So the contention raised by the opposite parties cannot be stated as unsustainable in view of the admission contained in the complaint. The learned counsel for the complainant had placed reliance upon a decision of the National Commission reported in The Tax Publisher Vs. Chairman & Managing Director, UCO Bank & Ors. I(2008)CPJ 86 (NC). It was in respect of a complaint filed by a proprietorship concern, named and styled as “tax publishers” doing the sale of books, journals and series. A cash credit account was maintained with the Bank. The accountant of the complainant had himself used the cheque leaves of the complainant and withdrew amounts from the account of the complainant by utilising the forged cheques.
16. A detailed enquiry was conducted and during the pendency of the above proceedings a case was instituted before the Consumer Forum. The complaint was dismissed on the reason that the complainant was doing a business which was a commercial activity and was not a consumer within the definition of Section 2(1)(d) of the Act. This was challenged before the National Commission. The National Commission had reversed the order of the State Commission and allowed the complaint. On a perusal of the full text of the ruling, it could be seen that the main issue considered by the National Commission was the correctness on the part of the State Commission in dismissing the complaint for the reason that complicated legal questions were involved and hence it has to be adjudicated by the Civil Court. That has been elaborately considered and each case has to be decided on the basis of evidence let in. the evidence on record would prove that the complaint is not maintainable as the transaction is commercial in nature. Point No.1 is found against the complainant.
17. The counsel for the complainant would submit that when the offer as per A1 was accepted without any protest bank cannot deviate from the standing instruction given by the customer. In support of the above proposition a Ruling of the Division Bench our Hon'ble High Court reported in 1960 KHC 149 in “Moolji Jaitha And Co Vs Seth Kiridimal” is pressed into service. It was a case where the offer to sell Coconut Oil was accepted by the opposite party through a Telegram. This ruling has no application to this case. Here the complainant would contend that in Exhibit A1 an instruction had been given by the complainant that no collection charges should be levied on the account. It is a concession sought for. When a concession for dispensing with the collection charges is claimed, the burden is upon the complainant to adduce evidence by causing production of authentic documents to show that the Bank had accepted the above proposal. A unilateral request to dispense with the collection charges cannot be enforced. The opposite party, through Exhibits B1 to B4 had requested the complainant to cause production of any documents to the effect that the Bank had taken a decision to do away with the collection charges. When a concession is claimed by the complainant the burden is upon the complainant to substantiate the same. The opposite party through Exhibits B1 to B4 had clarified their position that they cannot dispense with the collection charges unless a specific order has been obtained from the Bank, dispensing with the collection charges. As long as such an order is not obtained the Branch Mangers of the Bank cannot be blamed in collecting the charges. So also question of deficiency in service or unfair trade practice would never arise. The complainant has miserably failed to prove his case and the complaint is only to be dismissed.
In the result, complaint is dismissed. Parties shall bear their respective costs.
JUSTICE K. SURENDRA MOHAN | : | PRESIDENT |
AJITH KUMAR D. | : | JUDICIAL MEMBER |
K.R. RADHAKRISHNAN | : | MEMBER |
SL
C.C.No.23/2008
APPENDIX
- COMPLAINANT’S WITNESS
- COMPLAINANT’S DOCUMENTS
A1 | - | Copy of a communication dated 03.05.2001 issued by the Managing Director of the complainant |
A2 | - | Copy of particulars with respect to the collection of charges made by certain branches of the State Bank of India |
A3 series | - | Copies of the subsequent communications sent by the Finance Manager of the complainant |
A4 | - | copy of a letter dated 22.02.2007 issued by the Managing Director of the complainant |
A5 | - | Copy of the complaint before the Banking Ombudsman filed by the complainant |
A6 | - | Copy of the letter dated 30.04.2007 issued by the Banking Ombudsman |
A7 | - | Copy of the order dated 06.09.2007 |
A8 | - | Copy of authorisation issued by the Manging Director in favour of the Finance Manager |
A9 | - | Copy of the certificate issued by the Assistant General Manager, State Bank of India dated 31.12.2013 |
- OPPOSITE PARTY’S WITNESS
- OPPOSITE PARTY’S DOCUMENTS
B1 | - | Copy of the letter dated 27.10.2001 issued by the Branch Manager, SBI |
B2 | - | Copy of the letter dated 15.03.2006 issued by the Assistant General Manager |
B3 | - | Copy of the letter dated 21.05.2007 |
B4 | - | Copy of the letter dated 12.07.2007 by the General Manager, SBI |
- COURT EXHIBITS
JUDICIAL MEMBER