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RAJASTHAN STATE CONSUMER DISPUTES
REDRESSAL COMMISSION, JAIPUR
Hon’ble Mr. Justice S.K.M. Lodha, President;
Mr. Damodar Thanvi, Member.
MODERN MECHANICAL & ELECTRONICS—Appellant
versus
CHAIRMAN-CUM-M.D. RAJ FINANCAL CORP & ORS.—Respondents
Appeal No. 102/90—Decided on 13.12.1990
Consumer Protection Act - Complaint against refusal of loan - Section 12 - Section 15 - Section 2(1)(b), (d), (e), (g), (o) - Section 14(1) - National Commission's interpretation of 'deficiency in service'
Fact of the Case:
The complainant, a small scale industry, filed a complaint against two financial institutions for refusing to grant a rehabilitation grant and attempting to take possession of the unit. The District Forum dismissed the complaint, stating that the complainant was not a 'consumer' and the dispute did not constitute a 'consumer dispute'.
Finding of the Court:
The District Forum held that the complainant was not a 'consumer' and the dispute did not constitute a 'consumer dispute'. It also found that the property in question exceeded the pecuniary jurisdiction of the District Forum. The court referred to various precedents and interpretations by the National Commission to support its decision.
Issues: 1. Whether the complainant was a 'consumer' under the Consumer Protection Act. 2. Whether the dispute constituted a 'consumer dispute'. 3. Whether the District Forum had pecuniary jurisdiction over the matter.
Ratio Decidendi: The court relied on the definitions of 'complainant', 'complaint', 'consumer', 'consumer dispute', 'deficiency', and 'service' under the Consumer Protection Act, as well as the interpretations of the National Commission in similar cases, to reach its decision.
Final Decision: The appeal was dismissed, and the parties were left to bear their own costs.
Mr. Justice S.K.M. Lodha, President — By this appeal under Section 15 of the Consumer Protection Act, 1986 (“the Act” herein) the complainant appellant questions the correctness and legality of the order dated 15.6.1990 passed by the District Forum, Jaipur in Complaint Case No. 721/89. The District Forum dismissed the complaint without going into its merit. It upheld the preliminary objections. Suffice it to state that the complainant submitted a complaint under Section 12 of the Act against Rajasthan Financial Corporation, Jaipur (opposite party No. 1) and State Bank of India, Malviya Nagar Branch, Jaipur (opposite party No. 2) on 19.10.1989. The complainant Modern Mechanical and Electronic Engineering Group is a small scale industry which prepares electric motors, General fabrication (steel furniture, cooler etc.). It has been alleged in para 18 of the complaint that there is an investment of Rs. 6,50,000/- on the unit Out of that Rs. 2,00,000/- are of opposite party No. 1 and Rs. 2,00,000/- are of opposite party No. 2. The complainant had mortgaged the building, plant and machinery with opposite party No. 1, The valuation of which is in excess of the loan amount. According to the complainant the loan taken by the complainant is secured as the market value of the property is more than Rs. 18,00,000/-. It was alleged that opposite party No. 1 refused to give rehabilitation grant vide letter dated 5.10.1989 and the opposite parties are bent upon taking possession of the unit, for which it has no authority particularly when the application dated 19.10.1989 is pending before opposite party No. 1. The complainant apprehended that opposite parties may take possession of the unit without following the legal procedure, so he is entitled to get an order that the complainant should not be dispossessed and the opposite parties may be bound down not to refuse advance. The relief para of the complaint is as follows :
2. With the complaint various documents were filed. Opposite Party No. 1 resisted the complaint by filing a version dated 23.12.1989. It was, inter alia, pleaded that it is not the responsibility of Opposite Party No. 1 to advance working capital to the complainant and that as the complainant has failed in making payment of the loan and the arrears started amounting up still it agreed to give second charge to the Bank which was sufficient. An objection was taken that the complainant is not a “consumer”. The amount that was advanced by Opposite Party No. 1 to the complainant was a loan according to the terms of the contract. The proceedings which opposite party No. 1 has taken against the complainant are in accordance with the provisions of the R.F.C. Act. It was also stated in the version of the case that the reliefs which the complainant has asked cannot be granted by a redressal forum under the Act. A rejoinder was filed by the complainant. Opposite Party No. 2 while controverting the allegations made in the complaint averred that the complainant failed to make payment of the loan that was advanced by it and, therefore, Opposite Party No. 2 instituted a suit against the complainant and others for Rs. 3,97,332/- in the Court of District and Sessions Judge, Jaipur City, which was transferred to the Additional District and Sessions Judge, Jaipur City No. 3. The next date as stated in the version of the case was 21.2.90. In the additional pleas it was mentioned that the complaint of the complainant is in regard to the grant of working capital does not fall under the category of service and so it may be dismissed. The complainant filed rejoinder to the version of the case submitted by Opposite Party No. 2. The District Forum took note of Special Machines Karnal v. Punjab National Bank and others I (1991) CPJ 78 (NC)=Original Petition No. 32/89 decided on 22.12.1989 by the National Commission. It also referred to the order of the National Commission passed in M/s. Dees Piston Pvt. Ltd. v. State Bank of India decided on 2
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