Mr. Justice A.L. Bahri, President—In mis complaint, the complainant Morinda Cooperative Sugars Mills Limited, Morinda (hereinafter called’ the Mill’) claims a sum of Rs. 9,70,758/- from the opposite parties — the State Bank of Patiala, Morinda Branch and Head Office, Patiala (hereinafter called ‘the bank’). On the aforesaid amount, the claimant also claims interest at the rate of 18 per cent from the date of filing of the complaint till realisation. He also prayed for costs. After the parties produced pleadings, an opportunity was afforded to them to produce evidence. Some documents were produced. Sub-sequently, the Counsel for the parties stated that on the admitted pleadings and documents produced, the case may be disposed of. It was so ordered on March 1, 1995.

2. Mostly, the facts are admitted, hence they are summarised from the pleadings, as well as documents relied upon. The Mill stood as guarantor for re-payment of the loan advanced by the bank to several agriculturists. Some of the agriculturists took loan of Rs. 7500/- on 12% per annum interest and others Rs. 10,000/- at the rate of 13.5% per annum interest. The amount of loan was disbursed to the agriculturists through the complainant. The terms and conditions are contained in the deed of Guarantee copy produced by the Mill (Pages 13-17 of the record). The Mill was required to repay the amount advanced in the following schedule :

- 15% upto December, 1992

+ 20% upto January, 1993

+ 25% upto February, 1993

+ 40% upto March 31,1993

3. Some of the agriculturists re-paid the loan to the Mill. However, the Mill did not forward the aforesaid amount repaid by the agriculturists to the bank. Ultimately, the bank created a lien on the account of the Mill main tained in the bank and thus ultimately it debited a sum of Rs. 51,36,989/- on January 11, 1994. This amount includes the sum of loan returned by the agriculturists to the Mill as well as interest thereon at the rate of 21 per cent per annum treating it as Clean loan. According to the Mill, at the most, Rs. 48.18 lacs could only be recovered by the bank which would include the amount of loan returned by the agriculturists and interest which was agreed upon between the parties. In this manner, the bank deducted a sum of Rs. 4,91,758/- in excess and thus there was a deficiency in the service rendered by the bank to the Mill. The Mill, therefore, claims the aforesaid amount plus a sum of Rs. 2,79,000/- as interest on Rs. 62 lacs withheld by the bank unauthorisedly making a lien for a period of .3 months as well as a sum of Rs. 2 lacs on account of harassment caused to the Mill on account of deficient service. The total of these amounts being Rs. 9,70,758/-.

4. The bank controverted the claim inter-alia pleading that the claimant could not be treated as a ‘Consumer’ as defined under Section 2(d) of the Consumer Protection Act, 1986. The transactions of advancing loans to the agriculturists and recovery therefrom could not be treated as service as defined under the Act. On merits, it was stated that Crop loan aggregating to Rs. 1,73,37,500/- was required to be repaid alongwith contractual interest thereof, for which the Mill had stood Master Guarantor vide Guarantee Deed dated March 18, 1992. Subsequently, on February 4, 1992, it was clarified in bank’s letter that the rate of interest was subject to change as per norms of the bank and directions given by Reserve Bank of India. Schedule of repayment of amount in four instalments, as already mentioned above, was admitted. Since the loan was not adjusted by the Mill upto March 31, 1993, although the same was recovered by the bank from the growers, the aforesaid amount was mis-appropriated by the Mill and utilised for commercial purposes. Thus the purpose of the loan stood changed from agriculture purpose to commercial purpose and thus becomes a clean Over-Draft in the hands of the claimant and attracted higher interest i.e., 16½% and 2% penal interest from March 31, 1993 as per in