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NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION, NEW DELHI
Dr. B.C. Gupta, Presiding Member
Bank of India and Ors. —Appellants
versus
M/s. Punjab Hide Co. and Ors. —Respondents
First Appeal Nos.1446 and 1452 of 2014
Decided on 15.3.2017
For the Appellant in FA No.1446:Mr. R.K. Dhawan and Mr. Pallav Saxena, Advocates
For the Appellant in FA No.1452:Mr. Gaurav Srivastava, Advocate
For the Respondents:Mr. Rajvir Singh Sihag, Advocate
IMPORTANT POINT
Complaint can be dismissed on sole ground of maintainability.
Headnote:Consumer Protection Act, 1986—Sections 17, 19 and 21—Banking—Deficiency in service—Letters of credit—Letters of credit was opened for commercial purpose only—No evidence had been produced in support of revised version of appellants that five partners of complainant firm were engaged in affairs of firm exclusively for the purpose of earning their livelihood by means of self-employment—It has not been stated anywhere whether these parties had any other means of earning their livelihood or not—Complainant does not fall under category of ‘consumer’ as defined under Consumer Protection Act and complaint deserves to be dismissed on this ground alone—Even on merits, complainants have tried to take shelter under plea that since goods are stated to have been received by buyer, condition of IBA approved Transport Company is not relevant—However, even if goods were received by buyer, conditions as stated in LC stand and should have been complied with by complainant—Complainants have no right to claim amount under LC as documents submitted by them were not in conformity with conditions stipulated in LC—Conclusion arrived at by Banking Ombudsman cannot be faulted in any manner—Order passed by State Commission is perverse in eyes of law and same ordered to be set aside and consumer complaint dismissed. (Paras 20 to 28)
Result: Appeals allowed.
Dr. B.C. Gupta, Presiding Member—These two first appeals have been filed under section 19 read with section 21(a)(ii) of the Consumer Protection Act, 1986 against the impugned order dated 27.10.2014, passed by the Punjab State Consumer Disputes Redressal Commission (hereinafter referred to as ‘the State Commission’) in Consumer Complaint No. 33/2008, by which the said complaint was allowed in favour of the complainant M/s Punjab Hide Company.
2. The complainant M/s Punjab Hide Company is stated to be a registered partnership firm, engaged in manufacturing and supply of wet glue and finished leather, having office at Amritsar, Punjab and branch office/works at Jalandhar, Punjab and Hapur (U.P.). The complainant is stated to have supplied certain goods to opposite party (OP) No. 3 M/s. Bawa Shoes Limited having their registered office at Goindwal Sahib and Corporate Office at Jalandhar. As a security for payment of the goods, the buyer M/s. Bawa Shoes Limited opened three irrevocable letters of credit in favour of the complainant with OP-1, Punjab & Sind Bank. Credit No. 21/76/03 for a sum of Rs.8,50,000/- was opened on 14.11.2003 with expiry on 10.12.2003. Credit No. 21/80/03 for a sum of Rs.4,00,024/- was opened on 25.11.2003 with expiry on 15.12.2003 and third, credit No. 21/82/03 for a sum of Rs.10,00,787/- was also opened on 25.11.2003 with expiry on 15.12.2003. Under the heading “documents required” on these letters of credit, it has been stated as follows:—
“Documents Required
1. Beneficiary’s draft drawn on applicant at 60 days from the date of bill.
2. Beneficiary’s signed invoices in 3 copies.
3. Lorry receipt alongwith one copy evidencing goods consigned to PUNJAB & SIND BANK IBD, JALANDHAR showing freight to pay.
4. Insurance on account of applicant.
5. Despatch by IBA approved transport company only.”
Under the heading “additional conditions”, it has been stated as follows:-
“Additional Conditions:—
1. All banking charges, other than our bank, for beneficiary’s A/c.
2. Reimbursement will be made on due date only if documents are received by us strictly in accordance with the terms of L/C.
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3. The OP-2 Bank of India is the collecting bank on behalf of the complainant M/s. Punjab Hide Company. It has been stated that the complainant sent some goods to OP-3 as per terms of contract between them and the said goods were received and acknowledged by it. They issued two certificates dated 28.11.2003 and one letter dated 2.12.2003, saying that the goods dispatched under the letter of credit had been received by them.
4. The complainant, after the dispatch of the goods and receipt of the same by the OPs negotiated the letters of credit, amounting to a total of Rs.22,50,811/- with OP-2 Bank of India being its banker and the OP-2, vide its letter dated 06.12.2003 submitted the required documents to OP-1 Punjab & Sind Bank for getting the letters of credit honoured. On the other hand, the complainant got the letter of credit discounted on 27.01.2004 for a sum of Rs.20 lakh from the OP-2 Bank of India and in the process, paid a commission of Rs.2,50,811/- to the said bank.
5. The complainant was then informed by OP-2 that the OP-1 Punjab & Sind Bank had returned the letters of credit alongwith original documents vide their letter dated 25.02.2004 which was received by the OP-2 on 06.03.2004. The OP-1 returned the documents on the ground that these were not accompanied by a lorry receipt and the goods were not dispatched through IBA (Indian Banking Association) approved transport company. The OP-2, Bank of India sent reply to OP-1 Punjab & Sind Bank vide letter dated 08.03.2004 and requested them to reconsider its decision in view of the fact that the consigned goods had been received by the OP-3 buyer. The OP-1 Punjab & Sind Bank replied vide letter dated 18.03.2004 that they had taken-up the documents, purely on collection basis and in case, the payment was received from the OP-3 buyer, the sa
