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TAMIL NADU STATE CONSUMER DISPUTES REDRESSAL COMMISSION, CHENNAI
R. Subbiah, President and R. Venkatesaperumal, Member
K. Murugesan – Complainant
versus
The Regional Manager
Bank of Baroda and Anr. – Opp. Parties
CC No.180 of 2016
Decided on 26.4.2023
Counsel for the Parties:
For the Complainant: In person
For the Opp. Party No.1: M/s. P.R. Raman
For the Opp. Party No.2: M/s. S. Padma
IMPORTANT POINT
Sanctioning of Loan - The sanctioning of loan is purely the discretion of the concerned bank.
Headnote:
Consumer Protection Act, 1986 – S.17 – Services – Banking – Loan Services - Sanctioning of Loan – Discretion of Bank - Availment of Loan for commercial purpose – Complaint not maintainable - The case of the complainant is mainly on the allegation that the 1st opposite party had not sanctioned loan for starting a Vegetable Preservation Industry under PMEGP (Prime Minister Employment Generation Programme). The loan sought for by the complainant is for a sum of Rs.23.75 lakhs for business purpose - In the complaint on hand, the complainant had neither hired or availed the services of the opposite parties by paying any consideration. Therefore, he cannot be considered as a consumer - Further he availed the services of the opposite parties for commercial purpose i.e., to start up an industry. Therefore, it is clear that the complainant will not come under the definition of Consumer, and thus the complaint is not maintainable before this commission – Also held, the sanctioning of loan is purely the discretion of the concerned bank. When the main criteria viz. the credit worthiness as well as the output of his industry is not satisfiable for the loan sanctioning authority, then they cannot be questioned for non-sanctioning of loan. In the present case, the complainant had obtained other term loans from the 1st opposite party, which he had not repaid regularly, and in this connection a Sarfaesi proceedings was also pending against the complainant. Therefore, the 1st opposite party had raised the doubt about the repaying capacity of the complainant. Moreover, the 1st opposite party had stated that based on the detailed viability report on the performance of the project of the complainant, it was found not eligible for restructuring and only after finding that the project was not feasible, the opposite party rejected the loan proposal of the complainant – Thus, the complainant also cannot make an allegation against the 2nd opposite party, for not marketing his products – Complaint dismissed. [Paras 9 to 11].
Result: Complaint dismissed.
ORDER
R. Subbiah, President—This complaint has been filed under Sec.17 of the Consumer Protection Act, 1986, as against the opposite parties for the following reliefs:—
1. To pay the Revenue loss on own investment @Rs.21,94,182.47/-
2. To pay Rs.17,32,432.42/- towards promoter wages
3. To pay the security wages @Rs.4,33,664.21/-
4. To pay Rs.51,97,297.26/- towards mental agony
5. To pay Rs.1,20,920.28/- towards Revenue loss on subsidy and
6. To pay Rs.1,50,000/-towards rehabilitation liaison expenses
Totally a sum of Rs.98,28,496.64/-
2. The case of the complainant could be culled out from the pleadings, in brief is as follows:
The Central Government of India had invited the first generation entrepreneurial aspirants to execute projects for the motivation of self employment generation as well as eradication of unemployment through the Prime Minister Employment Generation Programme (PMEGP). The complainant who was very much impressed upon the said scheme, took a voluntary retirement from the Government Service for execution of an Agro based MSME project as a priority sector of the Government in a backward rural area. The said scheme was implemented by the Khadi and Village Industries Commission, and the District Industries Centre, and the fund was provided to this project by the 1st opposite party. The then Manager of the 1st opposite party had directed the complainant to submit some detailed statements vide letter dt.6.12.2012 to release the loan for Rs.6 lakhs. But the said loan application was rejected by the opposite party after a period of 1 month. Therefore, the complainant took up the matter to the competent authorities of the said scheme. After a period of one year, the said Branch Manager had realised his mistake and again agreed to release the loan vide letter dt.23.1.2014. But again the loan had not been released. After two years, the present Manager of the 1st opposite party had asked to present the loan application vide letter dt.31.1.2016. The Credit Manager of the opposite party had imposed a term that he has to achieve 20% projected sales to appraise the performance to release the loan amounting to Rs.8 lakhs. But he has not considered to release the loan despite fulfilment of his term. Thereafter, the complainant met the Regional Manager and Branch Manger and he also had a joint meeting with the Regional Manager, General Manager of DIC, the LDM, the District Collector, and the Commissioner of MSME. But nothing worked out for availing loan, and prioritise project in a vital manner. Thus alleging negligence on the part of the opposite parties, the complainant filed this complaint, praying for the relief as stated supra.
3. The case of the complainant was resisted by the 1st opposite party as follows:
The complaint is not maintainable since denial of restructuring and rehabilitation of loan accounts for a commercial purpose is not a consumer complaint. Therefore, the complaint is to be dismissed in limine. The complainant availed three term loans from the answering opposite party. Due to his own mismanagement of the project, he was unable to repay the amount. Therefore, he cannot allege deficiency in service on the part of the opposite party. In fact the 1st opposite party had already taken possession of his property at Nilgiris Registration District, Nilgiris JSROII, Sub District, Udagamandalam Taluk, Kanacombai, Thummatty Village, Ooty Taluk, Old Survey No.57/1, RS No.628 totally measuring 0.25 acres. The complainant had approached the opposite party on 27.2.2009, requesting for loan of Rs.23.75lakhs (95% of project cost) from the Bank and Rs.1.25 lakhs (5% his own fund as margin) as his own contribution to start a Vegetable Preservation Industry . The total cost of the project was Rs.25,00,000/-. The complainant’s project was inaugurated on 15.7.2010. However, the complainant proceeded to severely mismanage the project and was unable to pay any of his loans. By March 2011, the complainant had avail
