The court ruled that conditions for redeeming pledged jewels imposed by the bank were unreasonable and legally impermissible, affirming the State Commission's order.

1. Heard Mr. T.K. Goon, Advocate, for the appellants and Mr. S. Loganathan (the respondent), in person.

2. Aforementioned appeal has been filed from the order of Tamil Nadu State Consumer Disputes Redressal Commission, Madurai dated 19.3.2014, passed in Consumer Complaint No.37 of 2012, whereby the complaint filed by the respondent was partly allowed and the appellants were directed to redeem the jewels on receipt of principal amount and interest up to 28.12.2008 and pay compensation of Rs. 50,000 to the respondent.

3. S. Loganathan (the respondent) filed Consumer Complaint No.37 of 2012 for directing Chairman, Dhanlaxmi Bank Ltd. and others (the appellants) to (i) redeem his property, taking interest up to 28.12.2008, (ii) pay compensation of Rs. 26 lacs for withholding the property, (iii) pay compensation of Rs.10 lacs for mental agony and harassment, (iv) pay compensation of Rs. 5 lacs, for deficiency in service, (v) pay Rs. 15 lacs as exemplary cost for abusing their position in derogation of law, (vi) pay Rs. 50,000 as cost of litigation and (vii) any other relief which may be deemed fit and proper, in the facts and circumstances of the case.

4. The complainant stated that Dhanlaxmi Bank Ltd. was a banking company and engaged in banking business. The complainant had his account in Dhanlaxmi Bank Ltd., Branch Sastri Road, Thillai Nagar, Trichy, from a long time and availed several credit facilities. The complainant took term loan against pledging jewel on 20.12.2007, vide Reference Nos.PN / GL 309/2007-2008 for Rs.4,77,000 and PN / GL 313/2007-2008 for Rs. 4,96,000. The complainant went to the branch office on 28.12.2008, for paying the aforesaid loan amount and redeeming his jewels but the opposite party - 3 refused to redeem the jewels. The complainant gave a notice dated 25.9.2009, for redemption of his pledged jewels but no reply was given. The complainant again went to the branch office on 22.10.2010 for paying the loans amount but the Branch Manager again refused to accept the amount and redeem the jewels. In this respect, the complainant wrote various letters to the opposite parties. The complainant obtained some contracts from Highways Authority, Tamil Nadu and in that connection had submitted bank guarantee issued by opposite party - 3. When bank guarantee was presented for encashment, opposite party - 3 denied issue of bank guarantee, which resulted in filing of criminal complaint against the complainant. Opposite party - 3 malafide filed three criminal complaints under S.138 Negotiable Instrument Act , without presenting the cheque to the bank for encashment. The opposite parties put a condition for executing indemnity bond, for redemption of the pledged jewels, the language of which amounts to admission of guilt.

5. The appellants filed their written reply on 21.4.2012 and contested the complaint. It has been stated that the complainant had availed services of the bank for commercial purpose and was not a consumer. The complainant forged bank guarantees for Rs.10.81 lacs, using bank seal. When the bank guarantees were presented for encashment by Highways Authority, Ariyalur, Tamil Nadu on 01.04.2008, then the fact relating for fabrication of bank guarantee came to the notice of the bank and criminal complaint was filed. Opposite party - 3 again received a letter dated 7.4.2008 from Highways Authority, Nagapattinam, for renewal of bank guarantee dated 22.2.2006 for Rs.187000. This bank guarantee was also fabricated using bank seal. Highways Authority, Nagapattinam, vide letter dated 15.4.2008, sought verification of bank guarantees No.2/2005-06 for Rs. 2,92,000, dated 1.2.2006, 3/2005-