2006 Supreme(SC) 618

2006(5) Supreme 561
SUPREME COURT OF INDIA
Arijit Pasayat and S.H. Kapadia, JJ.
Standard Chartered Bank Ltd. — Appellant
versus
Dr. B.N. Raman — Respondent
Civil Appeal No. 2982 of 2006
(Arising out of S.L.P. (C) No. 19723 of 2004)
Decided on 14-7-2006
Counsel for the Parties :
For the Appellant : Mukul Rohtagi, Sr. advocate, Sanjay Gupta, Mrs. Varsha Kirpalani, N. Gupta and Rajeev Sharma, Advocates.
For the Respondent : Dr. Rajeev Dhawan, Sr. Advocate, Balraj Dewan, Advocate.

IMPORTANT POINTS
1. Banking is business transaction between bank and customers and such Customers are Consumers within meaning of Section 2(1)(d)(ii) of Consumer Protection Act.
2. In an action to recover an amount payable in foreign currency, five dates compete for selection by Court as the proper date for fixing rate of exchange at which foreign currency amount has to be converted into currency of country in which action has been commenced and decided.

Headnote:Consumer Protection Act, 1986 — Section 2(1)(9) and 2(1)(o) — Banking Service deficiency — Banking is business transaction between bank and customers — Such Customers are Consumer under the Act — Respondent-complainant a non-resident Indian deposited US $ 5000 in Foreign Currency Non-Resident Account for 63 months on 17.8.79 — Deposit was renewed for further periods till 1992 — Deposit renewal requests were being sent from foreign Country where Complainant was staying — In January 1992 when complainant came to India and enquired about status of his deposits, bank informed by its letter dt. 7-9-92 that there was no outstanding amount in his FCNR account and said deposit was prematurely withdrawn on 22.11.79 — State Commission on a complaint by respondent held that since initial deposit of US $ 5000 stood established, there was no evidence to show that respondent had given written instructions to bank for premature withdrawal and that there was no endorsement on receipt showing payment in lieu of discharge and that respondent was not in India on the date of premature withdrawal, decreed the claim — National Commission upheld the order in appeal — Appeal — Claim for money decree with interest at 18% p.a. however was on higher side — Rate of exchange which was indicative of price and constantly varied from time to time was not examined — In an action to recover amount payable in foreign exchange, five dates were relevant for Court for fixing rate of exchange — Matter needed to be examined on that aspect a fresh and remanded to State Commission on that limited issue.

       Held : By order dated 28.4.97, the State Commission came to the conclusion that the respondent had deposited US$ 5000 on 17.8.79 carrying 9% interest and maturing on 17.11.84; that the receipt was retained in safe custody; that there was no record to show that the said amount was prematurely withdrawn; that there was no evidence regarding destruction of the records on completion of eight years and since the initial deposit of US$ 5000 on 17.8.79 stood established the decree, as prayed for, was granted by the State Commission. The Commission further found that there was no evidence on record to show that the respondent had given written instructions to the bank for premature withdrawal; that there was no endorsement on the receipt showing payment in lieu of discharge and, therefore, the bank was not entitled to place reliance only on entry in the sale/purchase register dated 23.11.79. The State Commission further found that on 23.11.79 respondent was not in India. In this connection, reliance was placed on the endorsement in his passport. Accordingly, the State Commission came to the conclusion that the deposit was reviewed from time to time and, therefore, the complaint was within limitation. Accordingly, the decree in the aforestated terms was passed by the State Commission.(Para 6)

       The Consumer Protection Act, 1986 provides for formation of National Commission; State Commission and District Forum. These are remedial agencies. Their functions are quasi judicial. The purpose of these agencies is to decide consumer disputes. Activities relating to non-sovereign powers of statutory bodies are within the purview of the Act. The functions of such statutory bodies come under the term service under section 2(1)(o) of the Act. Banking is a commercial function. Banking means acceptance, for the purposes of lending or investment of deposit of money from the public, repayable on demand or otherwise [See: section 5(b) of Banking Regulation Act, 1949]. The intention of the 1986 Act is to protect consumers of such services rendered by the banks. Banks provide or render service/facility to its customers or even non-customers. They render facilities/services such as remittances, accepting deposits, providing for lockers, facility for discounting of cheques, collection of cheques, issue of bank drafts etc. In Vimal Chandra Grover v. Bank of India [AIR 2000 SC 2181] this court has held that banking is business transaction between bank and customers. Such customers are consumers within the meaning of section 2(1)(d)(ii) of the Act. Only two points appear to have been argued by the bank before the National Commission, viz., question of premature withdrawal and limitation. However, the claim of the respondent for money decree with interest at the rate of 18% p.a. till realization appears to be on the higher side and inflative. The rate of exchange, which is indicative of price and which constantly varies from time to time, has not been examined. This is apart from awarding of the rate of interest at 18% p.a. which itself is on the higher side. In the case of Forasol v. Oil and Natural Gas Commission [AIR 1984 SC 241] this court observed that in an action to recover an amount payable in a foreign currency, five dates compete for selection by the court as the proper date for fixing the rate of exchange at which the foreign currency amount has to be converted into the currency of the country in which the action has been commenced and decided. These dates are - the date on which the amount became due and payable; the date of the commencement of the action; the date of the decree; the date when the court orders execution to issue; and the date when the decretal amount is paid or realized. The court has to select a date which puts the plaintiff in the same position in which he would have been, had the defendant discharged his obligation when he ought to have done, bearing in mind that the rate of exchange is a fluctuating factor. To select the date when the amount became due, the court has to act in a just, fair and equitable manner because in a case where the rate of exchange has gone up, the opponent escapes by paying a lesser sum than what he was bound to and thus he gains by default while in the converse case where the rate of exchange has gone against the opponent, the opponent would be subjected to a greater burden than what it should be. (Paras 8 and 9)

       Neither the State Commission nor the National Commission has examined this question regarding selection of the appropriate date, the appropriate rate of exchange on that particular date as also the rate of interest which the appellant was required to pay. For this limited purpose alone, we partly allow the appeal and remit the matter to the State Commission to pass the decree in favour of the respondent herein in accordance with law indicated above. On all other factual findings, we are in agreement with the impugned decision.(Paras 9 and 10)