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SUPREME COURT OF INDIA
SUDHANSHU DHULIA, PRASHANT KUMAR MISHRA, JJ.
The Chief Manager, Central Bank Of India & Ors. – Appellant
Versus
M/s Ad Bureau Advertising Pvt. Ltd & Anr. – Respondents
Civil Appeal No. 7438 of 2023
With
M/s AD Bureau Advertising Pvt. Ltd. – Appellant
Versus
The Chief Manager, Central Bank Of India & Ors. – Respondents
Civil Appeal No. of 2025 (@ Diary No. 20192 of 2024)
Decided on : 28-02-2025
Consumer Protection Act, 1986 – Sections 2(1)(d) and 23 – Consumer – Scope and ambit – Status of borrower of a project loan – When the person uses goods bought, or avails any service for sole purpose of earning his livelihood, by means of self-employment, then such a person would not be excluded from definition of ‘consumer’ under the Act – Bald averment that company engaged itself in post-production of movie solely for the purposes of brand-building does not alter fundamental nature of transaction – Post-production of a film involves multiple activities, which finally gives shape and presentation to a film, which is a commercial venture – Respondent cannot be said to be a ‘consumer’ since obtaining a project loan did have a close nexus with a profit generating activity and in fact, dominant purpose for getting this loan sanctioned was to generate profits upon successful post-production of movie – Respondent is not a ‘consumer’ in terms of Section 2 (1) (d) (ii) of Act. (Paras 14, 16, 18 and 21)
Facts of the case:
Question which arises in these two appeals for determination is that whether borrower of a project loan, falls within definition of ‘Consumer’ under provisions of Consumer Protection Act, 1986
Findings of Court:
What is to be seen here is that whether dominant intention or dominant purpose for transaction was to facilitate some kind of profit generation for the person who has availed the service.
Result : Appeal allowed.
JUDGMENT :
SUDHANSHU DHULIA, J.
1. The question which arises in these two appeals for our determination is that whether the borrower of a project loan, falls within the definition of ‘Consumer’ under the provisions of the Consumer Protection Act, 1986 (hereinafter, ‘the Act’).
2. These statutory appeals arise from the order dated 30.08.2023 passed by the National Consumer Disputes Redressal Commission, New Delhi (hereinafter, ‘NCDRC’) in Consumer Complaint No. 23/2021. The appellant before us in Civil Appeal No. 7483 of 2023 is the Chief Manager, Central Bank of India and has filed the appeal under Section 23 of the Act, assailing the finding arrived at by the NCDRC holding that there was a deficiency in service on part of the appellant and thus, it is liable to pay compensation to the respondent No. 1, which is M/s Ad Bureau Pvt. Ltd., (a company engaged in the business of branding, consulting & advertising).
3. On the other hand, Civil Appeal (Diary) No. 20192 of 2024 has been filed by M/s Ad Bureau Pvt. Ltd., challenging the quantum of compensation awarded by the NCDRC, on the ground that the same has been awarded inadequately. For the sake of convenience, we shall refer to the parties as per their respective status in Civil Appeal No. 7483 of 2023.
4. The NCDRC vide its order dated 30.08.2023 has allowed the Consumer Complaint filed by respondent No.1 herein and has directed the appellants1[Appellant Nos. 1, 2 & 3 are the Chief Manager, Mount Road Branch, Chennai; Field General Manager, Chennai; and the Managing Director & Chief Executive Officer of the Central Bank of India respectively.] to pay a compensation of Rs. 75,00,000/ to respondent No.1 and to issue a certificate stating that the loan account of respondent No.1 with the Central Bank of India was settled and no outstanding dues remained in the said account and also holding that the Bank had wrongly reported the status of respondent No.1 as a defaulter to CIBIL2[Credit Information Bureau of India Limited.], which caused loss to the respondent No.1 in the market. Additionally, the appellants were also directed to pay to respondent No.1, litigation costs of Rs. 20,000/.
5. At the outset, it would be necessary to state the relevant facts.
On 28.04.2014, a Project Loan of Rs. 10 crores was sanctioned by the Central Bank of India in favour of respondent No.1, which is a private limited company carrying on advertising business. The purpose behind availing this loan was that respondent No. 1 was to engage in the postproduction of a movie. A property located at old D.No. 61, new D. No. 194, St. Mary's Road, Abhiramapuram, Chennai, which stood in the name of the Chairman and Managing Director of respondent No.1 was pledged as collateral for the loan. After availing the said loan, respondent No. 1 defaulted in repayment and its loan account and was classified as NPA3[NonPerforming Asset.] on 04.02.2015. When respondent No.1 failed to repay the amount even after issuance of Demand Notice by the appellantbank, a Possession Notice was issued on 21.05.2015 and pursuant to the same, symbolic possession of the property pledged as collateral for the loan was taken in terms of the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002 (hereinafter referred to as ‘SARFAESI Act’).
6. Thereafter, on 09.10.2015 the Bank filed an application under Section 19 (1) of Recovery of Debts Due to Banks and Financial Institutions Act, 1993 (hereinafter referred to as 'RDDBFI Act') before the Debts Recovery Tribunal, Chennai for recovery of an amount of Rs 4,65,39,715/. This application came to be allowed by the Debts Recovery Tribunal, Chennai vide order dated 05.12.2016 and the Bank was held to be entitled to recover an amount of Rs.4,65,39,715/ with interest @ 12% p.a. till the date of realisation along with costs. Pursuant thereto, a communication was addressed to the appellantbank by respondent No.1 offering a OneTime Settleme
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