Tamil Nadu

North Chennai

CC/161/2015

J.Jayakanthan,I.A.S - Complainant(s)

Versus

The Bank Manager - Opp.Party(s)

party in person

04 Apr 2018

ORDER

 

                                                            Complaint presented on:  14.10.2015

                                                                Order pronounced on:  04.04.2018

 

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, CHENNAI (NORTH)

    2^nd Floor, Frazer Bridge Road, V.O.C.Nagar, Park Town, Chennai-3

 

        PRESENT: THIRU.K.JAYABALAN, B.Sc., B.L.,        PRESIDENT

              THIRU. M.UYIRROLI KANNAN B.B.A., B.L.,      MEMBER - I

 

WEDNESDAY  THE 04^th  DAY OF APRIL 2018

 

C.C.NO.161/2015

 

 

J.Jayakanthan, I.A.S.,

S/o. Thiru.D.Jagadeeswaran,

Director,

Stationery and Printing Department,

110, Anna Salai,

Chennai – 600 002.

                                                                                    ….. Complainant

 

..Vs..

1.The Bank Manager,

Canara Bank,

Contonment, M.G.Road,

Spencers Junction,

Trivandrum – 695 001.

 

2.The Managing Director,

M/s. Print Finish Equipments,

Plot No.12,

Industrial Development Plot,

Muttom, Thodupuzha,

Kerala – 685 583.

.....Opposite Parties

Date of complaint                                  : 12.11.2015

Counsel for Complainant                        : Party in Person

Counsel for 1^st Opposite Party                  : M/s. K.P.Kiran Rao

 

Counsel for 2^nd opposite party                 : Mr.A.Palanlappan

 

O R D E R

 

BY PRESIDENT THIRU. K.JAYABALAN B.Sc., B.L.,

This complaint is filed by the complainant to direct the 1^st opposite party to pay the bank guarantee amount of Rs.20,00,000/- to the complainant with cost of the complaint u/s 12 of the Consumer Protection Act.1986.

1.THE COMPLAINT IN BRIEF:

          The complainant called for open tenders from the manufacturers of the machineries for supplying 2 colour and 4 colour web offset machines to the Government Central Press, Chennai-79. Three companies have participated in the tender and among them the 2^nd opposite party offered the lowest rate. The complainant also placed order with him to supply 4 colour web offset machine at the cost of Rs.2,55,09,387/- and 2 colour web offset machine at the cost of Rs.1,44,90,000/- and the machine should be supplied on or before 31.03.2010 with 2 years warranty. The 4 colour machines were supplied on 16.08.2010 and 2 colour machines on 23.09.2010. After receipt of machines 90% of the amount was paid after deducting penalty for the delayed supply.

          2. As per the tender condition, the 2^nd opposite party furnished 5% security deposit of the total value of 2 machines in terms of two bank guarantees issued by the State Bank of Travancore for Rs.20,00,000/-. Though machines were installed, they have not been handed over by the 2^nd opposite party in good working condition and the supplier has not fulfilled the tender conditions, the bank guarantee has to be with held by invoking the guarantee to pay in favour of the complainant which is due to the Government of Tamilnadu.

3.  The 1^st opposite party taken over the bank account of the 2^nd opposite party from the State Bank of Travancore and hence, it is the 1^st opposite party responsibility to honour the commitment towards the above bank guarantee in future. The complainant wrote a detailed letter dated 28.10.2014 to the 1^st opposite party invoking the bank guarantee. The 1^st opposite party did not pay the bank guarantee and hence the complainant filed this complaint to direct the 1^st opposite party to pay the bank guarantee amount of Rs.20,00,000/- to the complainant with cost of the complaint.  

4. WRITTEN VERSION OF THE 1^st  OPPOSITE PARTY IN BRIEF

          The State Bank of Travancore issued bank guarantee in favour of the complainant and not to the 1^st opposite party. Hence, the State Bank of Travancore, SME Branch, Thiruvananthapurum is the necessary party to this complaint. The service of this opposite party was not availed by the complainant and hence there is no privity of contract between them. The bank guarantees had expired on 02.08.2014 and as a routine practice, this opposite party issued letter dated 18.10.2014 to the complainant calling upon him to return the original bank guarantees in order to close the same in their books of account. The complainant after receiving the said letter, and invoked the bank guarantee after expiry of the period cannot be maintained. There is no cause of action to this complaint and prays to dismiss the complaint with costs.

 

5. WRITTEN VERSION OF THE 2^nd   OPPOSITE PARTY IN BRIEF

          This opposite party admits that they have participated in the tender and supplied machineries to the complainant as required by them. The complainant purchased the machinery for commercial purpose for generating huge profit and hence this complaint is not maintainable. The bank guarantee issued in favor of the complainant was expired as early as 02.08.2014. After expiry of the period the complainant cannot invoke the bank guarantee. The complainant after satisfied with his purchase he had made the payment. This opposite party had not committed any deficiency to the complainant and prays to dismiss the complaint with costs. 

6. POINTS FOR CONSIDERATION:

          1. Whether there is deficiency in service on the part of the opposite parties?

          2. Whether the complainant is entitled to any relief? If so to what extent?

7. POINT NO :1 

          Admittedly the complainant called for Ex.A1 open tender from the manufacturers of the machineries for supplying  2 color and 4 color web offset machines to the Government Central Press, Chennai-79 and three companies have participated in the tender and among them the 2^nd opposite party offered the lowest rate and the complainant also placed order with him to supply 4 color web offset machine at the cost of Rs.2,55,09,387/- and  2 color web offset machine at the cost of Rs.1,44,90,000/- and the 4 color machines were supplied on 16.08.2010 and 2 color machines on 23.09.2010 and after receipt of machines 90%of the amount was paid and the complainant also wrote Ex.A6 to A9 letters to the 2^nd opposite party for early commissioning of the machines and the 2^nd opposite party also installed the machines and as per the tender condition, the 2^nd opposite party furnished 5% security deposit of the total value of 2 machines in terms of two bank guarantees issued by the State Bank of Travancore for Rs.20,00,000/-.

8. According to the complainant the 2^nd opposite party/ supplier has not fulfilled the tender conditions and hence he is invoking the bank guarantee in favour of the complainant which is due to the Government of Tamilnadu and hence he wrote Ex.A5 letter dated 28.10.2014 to the 1^st opposite party to pay the bank guarantee amount of Rs.20,00,000/- to him and the 1^st opposite party failed to pay the said amount and thereby committed deficiency in service and hence he has filed this complaint.

9. Initially the State Bank of Travancore, Thiruvananthapurum gave bank guarantee on behalf of the 2^nd opposite party for the machineries supplied by him in favour of the complainant. Ex.A2 &A3 bank guarantees given by  State Bank of Travancore for the period 03.08.2010 to 02.08.2014 for the value of  Rs.20,00,000/-. The 1^st opposite party gave Ex.B1 counter guarantee dated 23.03.2011 in favour of State Bank of Travancore. Therefore the 1^st opposite party has been rightly added as a party without adding State Bank of Travancore is justifiable. The 1^st opposite party wrote Ex.A4 letter dated 18.10.2014 to the complainant, stating that bank guarantees has been expired and requiring the complainant to return the original bank guarantee in order to liquidate the same, in order to close the account. Thereafter only, the complainant wrote Ex.A5 letter dated 28.10.2014 to the 1^st opposite party invoking the bank guarantee given by him and demanding to pay to him the guarantee amount of  Rs.20,00,000/-.

10. Admittedly the bank guarantee was valid till 02.08.2014 and thereafter expired. Hence after 02.08.2014 the bank guarantee given by the 1^st opposite party is not in force. The complainant demanded the bank guarantee nearly after 26 days of expiry of the bank guarantee. In Ex.B2 &B3 bank guarantees it has been clearly stated that this demand should be made on or before 02.08.2014. The complainant demanded after 02.08.2014 and after expiry of the guarantee period. Therefore, the 1^st opposite party has not committed any deficiency in service in not paying the bank guarantee to the complainant and accordingly this point is answered. No relief sought against the 2^nd opposite party in this complaint.

11. POINT NO:2

          Since the Opposite Parties have not committed any Deficiency in Service, the Complainant is not entitled for any relief and the Complaint is liable to be dismissed.

          In the result the Complaint is dismissed. No costs.

          Dictated to the Steno-Typist transcribed and typed by her corrected and pronounced by us on this 04^th day of April 2018.

 

MEMBER – I                                                                PRESIDENT

LIST OF DOCUMENTS FILED BY THE COMPLAINANT:

Ex.A1 dated 07.11.2009	Tender Document
Ex.A2 dated 03.08.2010	Bank Guarantee for 4 colour Web offset machine
Ex.A3 dated 03.08.2010	Bank Guarantee for 2 colour Web offset machine
Ex.A4 dated 18.10.2014	Canara Bank letter regarding retransmit the original Bank Guarantee in order to liquidate the Bank Guarantee
Ex.A5 dated 28.10.2014	This office letter to Canara Bank, cantonment, Trivandrum requesting to invoke Bank Guarantee
Ex.A6 dated 19.02.2011	Letter to 2nd opposite party for early commissioning of machines
Ex.A7 dated 22.03.2011	Letter to 2nd opposite party for early commissioning of machines
Ex.A8 dated 08.04.2011	Letter to 2nd opposite party to show cause for the delay in commissioning of machines
Ex.A9 dated 18.05.2011	Letter to 2nd opposite party for early commissioning of machines
Ex.A10 dated 31.12.2011	Letter to 2nd opposite party for early commissioning of machines
Ex.A11 dated 23.05.2012	Letter to 2nd opposite party intimating to pursue legal against for non-commissioning of machines
Ex.A12 dated 06.09.2012	Letter to 2nd opposite party informing to file a suit for commissioning of machines
Ex.A13 dated 21.12.2012	Letter to 2nd opposite party for early commissioning of machines
Ex.A14 dated 12.03.2013	Letter to 2nd opposite party
Ex.A15 dated 18.11.2014	Letter to 1st opposite party to pay under bank guarantee
Ex.A16 dated 19.11.2014	Letter to 2nd opposite party detailing the loss suffered by complainant early commissioning of machines

 

LIST OF DOCUMENTS FILED BY THE 1^st OPPOSITE PARTY :

 

Ex.B1 dated 23.03.2011                         Counter Guarantee  by Canara Bank

                                                          Trivandrum in favour of State Bank of

                                                          Travancore 

 

Ex.B2 dated 08.01.2015                          First opposite party’s letter to complainant

 

LIST OF DOCUMENTS FILED BY THE 2^nd OPPOSITE PARTY :

 

Ex.B3 dated 18.11.2014                         Communication sent to the complainant by

                                                           the State Bank of Travancore,

                                                           Thiruvananthapuram

 

Ex.B4 dated 08.06.2017                         Authorization letter issued by the 2^nd

                                                           opposite parties authorizing Mr.Cleatus JL

 

 

 

MEMBER – I                                                               PRESIDENT