Karnataka

Bidar

CC/14/2016

Chaitanya S/o Kashinath Panchal - Complainant(s)

Versus

The Manager SBH Bidar - Opp.Party(s)

P M Deshpande

21 Aug 2017

ORDER

 

 

 

::BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AT BIDAR::

                                                               C.C. No.14/2016

                                                                          Date of filing: 09.03.2016

                                                                   Date of disposal: 21.08.2017

 

P R E S E N T:-    

                              (1) Shri. Jagannath Prasad Udgata,                                                                                                                                        B.A., LL.B.,

                                                                                                President

 

                              (2) Shri. Shankrappa (Halipurgi),

                                                                                 B.A.LL.B.,

                                                                                           Member.

 

 

COMPLAINANT/S:             Chaitanya S/o Kashinath Panchal,

                                                Age :33 years,Occ: Self Employment,

                                                R/o H.No.3-143, Mahadev Mandir Area,

                                                Village Holsamudra, Tq. Aurad,

                                                Dist. Bidar.

 

                 (By Sri. P.M.Deshpande, Adv.)

 

                                                        VERSUS

 

OPPONENT/S:                      The Manager,

                                                State Bank of Hyderabad,

                                                Branch Kamalnagar,

                                                Tq. Aurad, Dist. Bidar.

 

                                    (By Sri. Mansoor Ahmed Khan, Adv.)

 

 

::   J UD G M E N T  ::

 

By Shri. Jagannath Prasad Udgata, President.

 

1. The complainant is before this Forum alleging deficiency of service in the part of the O.P by filing a complaint U/s.12 of the C.P. Act., 1986, attributing deficiency in service on the part of the O.P.

 

 

2. The sum total of the case of the complainant is as hereunder:

                        The complainant was unemployed.  The complainant under Karnataka Self Employment Programme (KSEP) for the year 2014-15 has got registered and obtained PRC (provisional registration certificate) from DIC with complying all the formalities and documentation, The DIC recommended to the O.P. bank for advancement of loan as he was selected under the scheme.  The O.P bank sanctioned the loan amount on dated 28.3.2015 and as per the terms and conditions of the bank, the complainant has fulfilled the conditions of the bank.   The project report, quotation ware also submitted to the O.P bank and the estimated loan amount was at Rs.5,00,000/-, despite which the O.P. bank initially had endorsed for Rs.2,25,000/- on the quotation forwarded to the O.P. bank dated 14.10.2015.  But the O.P. bank has utterly failed and not yet advanced the loan even after complying and fulfilling the prescribed procedure, though letter dated 14.7.2015 of the DIC Bidar, wherein it has sanctioned the loan amount to complainant under the scheme.    The complainant has invested Rs.75,000/- for process of documentation, compliances formalities and paper collection i.e., caste, income certificate, PRC rented premises for required SSI unit at the regular payment of rent with electrical installation, energy bill etc.  The complainant has made all out efforts, investments by raising funds from private persons with heavy interest for establishment of unit.  The O.P bank has sanctioned the loan amount after due procedures and compliance, but the O.P. did not release the loan.  The act of the O.P shows deficiency in service.    Hence, the complaint for damages etc.

 

 

 

 

 

 

3. The Opponent entering into defence on receipt of Court notice, has filed version denying the contents of complaint, contending that, the complaint is not maintainable against the O.P since there is no service sought by the complainant.   The complainant is not ‘consumer’ as defined under the Act.  The complainant is claiming relief in respect of commercial transaction which is beyond the purview of Consumer Protection Act.   The complainant made application for financial assistance under Karnataka Self Employment Programme (KSE) for the purpose of establishment of his own Steel Furniture unit at Kamalanagar before the DIC and in turn the DIC recommended the O.P bank for sanction subject to fulfillment of terms and conditions of the bank.   Accordingly, the then Manager of O.P. bank namely Sridhar Hubare issued letter to the effect that the Bank has in principle sanctioned loan of Rs.5,00,000/- Rupees five lakhs only  subject to fulfillment of terms and conditions of the bank.  This does not mean that, the loan is sanctioned, it was only sanction in principle which is subject to fulfillment of terms and conditions of the bank and the scheme of the government.  No doubt, the complainant submitted project report, and quotation to the bank, but that itself is not a ground to hold that, the O.P bank is bound to sanction the loan.  It is the discretion of the bank to sanction loan or reject the proposal of the complainant.    As per the letter of DIC Bidar dated 10.11.2014, it is clearly mentioned in the para-4 that existing units are not eligible under KSES Scheme.  The present Manager and Field Officer took up the case of the complainant in the end of October-2015 and conducted inspection of the unit and found that the unit was already existing/running unit, as such the complainant is not entitled for subsidized loan under the scheme.   The complainant submitted application to Deputy General Manager of O.P bank dated 28.12.2015, wherein he has stated that, he is running his own steel furniture shop at Kamalanagar, hence the complainant is not eligible for loan under the scheme.    The O.P bank is not at all concerned about the expenses incurred by complainant.   The complainant has suppressed the fact before the DIC that the complainant was having his existing steel furniture unit working at Kamalnagar.     The name of the complainant was recommended to the O.P. by the DIC for sanction, the O.P is not bound to sanction unless it fulfils the requirements and terms and conditions of the bank.  As per the DIC, the subsidy assistance is available only for NEW projects sanctioned specifically under the KSES and existing units are not eligible under the scheme.   The DIC is not the authority to sanction the loan.   The Asst. General Manager of the O.P bank through his letter dated 11.1.2016 informed the complainant that, as his unit was already in existence, as per the guidelines issued by the DIC, he is not eligible for sanction of loan under the scheme.   Since the O.P acted as per the guidelines issued by the DIC, hence, there is no deficiency in service on the part of the O.P.    Under the circumstances, the O.P pray to dismiss the complaint with costs.

 

4. The complainant has filed documents, detailed at the end of this order, so also the complainant has filed evidence affidavit justifying his side.  On the other hand, the O.P has filed documents, detailed at the end of this order, so also the O.P. has filed evidence affidavit justifying his side.  Both the complainant and O.P. filed their written arguments respectively.

 

5.         Considering contention of the complainant, the following points arise for our consideration:-

 

1. Whether this Forum has jurisdiction to entertain this complaint?
2. Whether the complainant has proved that there is deficiency in service on the part of the O.P.?
3. What order?

 

6.         Our answers to the points stated above are as follows:-

 

1. In the Affirmative.
2. In the Affirmative.
3. As per final orders owing to the following:

 

:: REASONS ::

 

7.         Point No.1 :- The opponent Bank has raised an objection interalia that, the complainant is not a consumer, claiming relief in respect of a commercial transaction and his case is beyond the purview of the consumer Protection Act.  We find little substance in the submissions of the opponent.  What the bank was required to do was to provide financial assistance (loan) under a special scheme of the Govt. For which the complainant had received training and the Deplt. Of Industry (D.I.C.) had recommended such financing even ready to provide subsidy.  The ban but, indulging into hyper technicality is defeating the self employment scheme as would be discussed underneath.  Section 2(1)(0) of the C.P. Act 1986 defines as follows:-    

Section 2 (1)(0) -    “service” means service of any description which is made available to potential [users and includes, but not limited to, the provision of] facilities in connection with banking, financing, insurance, transport, processing, supply of electrical or other energy, board or lodging or both,[ housing construction], entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;

 

8.         In the instant case, the applied finance being sanctioned and then the complaint unjustly deprieved of it, surely the service has been denied and the relationship of consumer and service provider is clearly established.  Thereby we answer this point accordingly.

 

9.         Point No.2 :-            It is born out of record that, the loan for a manufacturing unit of steel furnitures was sanctioned by the Bank.  The quotations for the machineries and equipments are clearly spelled out inEx.P.8.  The  Deptt. Of Industry, Govt. of Karnataka has put its approval vide Ex.P.9 and several other documents.  Sanction letter in principle was sent to the in-cumbent as is revealed in Ex.P.1 but adopting a sudden about turn, the opponent bank raises a point that , the complainant was having an existing unit and hence is not eligible for the sanctioned amount in terms of clause 4 of the letter of D.I.C. at Ex.P9.

 

10.       We have given our anxious considerations to the pleadings of the parties in this regard and documents submitted by them in the case.  What is obvious from Ex.P.6 is that, the  complainant had obtained licence from Kamalanagar Grampanchayath and is running a steel furniture shop at Kamalanagar.  The Bank, claiming such shop to be an existing unit is washing up its’ responsibility to provide the sanctioned loan amount.   The approach of the bank is quite mind bungling.  Metaphorically, if a tea stall owner, proposes to establish a tea-processing unit or acquire a tea garden to augment his income status, can the later two be by any stretch of imagination be deterred by the first one because the person was running a tea stall?  The commonsense appears to be eluded from the bank officials’ minds.  A shop, selling unit, purchases items from some other manufacturer or trader and sellers for a profit, while a manufacturer toils to fabricate the merchandise.  Both activities are completely different in concept from each other.  Of course, a trader may have to keep few small tools is his establishment for assembling the furniture components or rectify a dent or scrapped out paint.  That however cannot be said to be a manufacturing unit.

 

 

 

11.       Of course, we see from Ex.R.7, claimed to be an inspection report of certain official of the Bank, claiming that, “the fabrication unit is already existing and running well.  Noticed the machineries already held in the unit which are required for running the unit”.  On the top of this report however there is mention of “Fabrication shop”.

 

12.       The opponent bank has not bothered to examine the officer concerned or file his affidavit to throw light on his observations.  As we have inferred earlier, availability of few tools or apparatus on a furniture shop to attend small defects is not an unlikely phenomena.  But, on that ground, designating a shop as a manufacturing unit is ridiculous.  By no means, the Bank has been successful to establish its claim that, the complainant having existing similar unit is not eligible for the sanctioned amount and with holding the same has committed deficiency of service and hence, we answer this point accordingly and proceed to pass the following:

                                                       ::ORDER:: 

1. The complaint is allowed in part.
2. The opponent bank is hereby directed to release the sanctioned amount in favour of the complainant in tandem with the Joint Director, District Industries Centre, Naubad, Bidar.
3. There would be no cost or compensation in the peculiar circumstances of the case.
4. The Bank would be at liberty to insist on collateral if much apprehensive about their loaned amount.
5. Four weeks time granted to comply this order.

 

   

(Typed to our dictation then corrected, signed by us and then pronounced in the open Forum on this 21^st day of August-2017).

 

 

   Sri. Shankrappa H.                                             Sri. Jagannath Prasad                                  

Member.                                                                President.                                                                                         

                                                                         

 

 

 

Documents produced by the complainant

1. Ex.P.1-  Letter of the O.P. Bank to State Khadi and village Industries 
                  Board, Bidar. (copy).
2. Ex.P.2 – D.I.C. format for sponsoring the beneficiary for undergoing
                  EDP Training under KSES-2014-15. (copy).
3. Ex.P.3- Sanction memorandum of the Bank (copy)
4. Ex.P.4- Residential certificate of complainant (original)
5. Ex.P.5- Money receipt granted by Panchayath authorities. (original).
6. Ex.P6- Licence of Panchayath for running furniture shop. (original).
7. Ex.P.7- Caste certificate (original).
8. Ex.P.8- Quotation from Kisan Engineering Co. (Original)
9. Ex.P.9-Letter of D.I.C. to opponent bank date: 10.11.2014.
10. Ex.P.10- Reminder of D.I.C. to bank date: 14.07.2015.
11. Ex.P.11- S.S.L.C. certificate of complainant (copy).
12. Ex.P.12- Aadhar card of complainant. (copy).
13. Ex.P.13- Passbook (front page) of the complainant (copy).
14. Ex.P.14- E.D.P. certificate of complainant (original).
15. Ex.P.15- Detail branch wise target list under Karnataka Self Employment Programme (copy).
16. Ex.P.16- Project report (original).

             

 Document produced by the Opponent.

 

1. Ex.R.1-  Application form (copy)
2. Ex.R.2- D.I.C. letter to Bank date: 10.11.2014 (copy).
3. Ex.R.3- Letter of S.B.I. (Lead Bank) to S.B.H. Kamalanagar date:
                  13.01.2016. (copy)
4. Ex.R.4- Representation of complainant date: 06.01.2016 to
                   Dy. Commissioner, Bidar.(copy).
5. Ex.R.5- letter of opponent Bank to Asst. General Manager, region III
                 Bidar date: 02.01.2016 (copy).
6. Ex.R.6- Letter of the A.G.M. S.B.H. date: 11.01.2016 to complainant
                 (copy)
7. Ex.R.7- Appraisal of Bank official date: 15.10.2015.(copy).

 

 

 

Sri. Shankrappa H.                                             Sri. Jagannath Prasad                                  

       Member.                                                                      President.