Bank's refusal to advance loan despite consent letter and respondents' reliance on it, resulting in monetary and mental suffering, constitutes deficiency in services, making Bank liable to pay compensation for loss suffered by respondents.

Mr. Justice Lakshmana Rao, President—In all these Appeals in which State Bank of Hyderabad Raikal Branch is the appellant, as common question arise for consideration, they are disposed of by a common order.

2. Having been aggrieved by the common order dt. December 23, 1989 passed by the District Forum, Karimnagar in Consumer Dispute Nos. 18 to 38 of 1989 directing the opposite party. State Bank of Hyderabad, Raikal branch to sanction loan of Rs. 25,000/- to each one of the complainants, these appeals have been preferred.

3. The respondents in all these appeals are weavers by profession. They are residents of Raikal village, Karimnagar district and are members of Backward Class. They had worked for some time on powerlooms in Bhivandi, Maharashtra State. They had returned from Bhivandi to their native place due to some trouble at Bhivandi. It is stated that all of them are poor, unemployed persons. Having come to know that the Government was granting loans to poor unemployed persons for installation and running of powerlooms, the respondents approached the President, Mandal Praja Parishad, Raikal for help in that regard. Accompanied by the Mandal Praja Parishad President, they met the Assistant Director of Handlooms and Textiles, Karimnagar. On his advice, the respondents submitted applications to him on March 28, 1988 for provisional registration of proposed small scale industrial units. On March 31, 1988, he provisionally registered the proposed S.S.I. Units for the manufacture of cotton gray cloth on powerlooms and granted provisional registra- tion certificate dated March 31.1988 in favour of each one of the respondents herein. Ex. A-2 is one such certificate issued to M/s. B.L. Textile (Bairi Lingam, respondent in C.D.A. No. 6/90). PW-1 who is the respondent in C.D.A. No. 6 of 1990 deposed that he had remitted Rs. 500/- by way of challan towards provisional registration fee of the unit consisting of two powerlooms. So also the other respondents had remitted the money.

4. On March 31, 1988 itself, the respondents herein applied to the General Manager, District Industries Centre, Karimnagar for the issue of eligibility certificate under 10% Central Subsidy scheme. He issued eligibility certificate dated March 31, 1988 to each one of the respondents and requested them to furnish the claim application within six months from the date of going into production. Ex. A3 is one such certificate issued in favour of the respondent in C.D.A. No. 6 of 1990.

5. Thereafter, the respondents approached the Assistant Director of Handlooms and Textiles, Karimnagar and requested him to recommend to the Divisional Executive Engineer, A.P. State Electricity Board, Karimnagar for supply of electrical energy to the proposed Small Scale Industrial Units. Through his letter dated April 11, 1988 (EX. A4) addressed to the Divisional Executive Engineer, A.P.S.E.B., Karimnagar, he requested the Executive Engineer to consider the case of the respondents for supply of electrical energy for the purpose of installation and running of the powerlooms. It was mentioned therein that provisional registration was granted for those units under the S.S.I. Scheme. The Assistant Director, Handlooms and Textiles, Karimnagar had also prepared a feasibility scheme for two powerlooms. The respondents remitted Rs. 500/- each to the A.P. State Electricity Board and the Divisional Engineer, A.P. State Electricity Board and the Divisional Engineer, A.P.S.E.B., Karimnagar issued a feasibility certificate to each one of them.

6. While so, the Mandal Development Officer ‘Raikal Mandal Praja Parishad had written a letter dated April 5, 1988 (Ex. A5) to the Manager, State Bank of Hyderabad, Raikal Branch, the appellant herein recommending for advancement of loan to each one of the respondents at the rate of Rs. 36,400/- and for the issue of consent letter to that effect. It was mentioned therein that on the basis of such consent letter, the Karimnagar District Backward Classes