(Per Hon’ble Shri Narendra Kawde, Member)

(1)               Complainant is a small scale industrial unit engaged in designing, engineering, manufacturing and supplying of materials handling equipment on turnkey basis.  The complainant is banking with the opponent, Union Bank of India, Goregaon Branch, Mumbai (hereinafter referred to as “Opponent Bank”) and availing cash credit and other facilities extended by the Opponent Bank since quite long time.  Opponent Bank sanctioned credit limit by letter dated 07/04/2000 for execution of projects at Sikka, Jamnagar, Gujarat.  The credit limit was for the period of 15 months.  Regular credit of `95 lacs and adhoc credit of `190 lacs was sanctioned and communicated by the said letter with rate of interest thereon @16.32% p.a.  Reserve Bank of India announced waiver of interest on the credit facility for execution of work in earthquake area of Gujarat thereby stipulating the conditions that the measures indicated in the scheme were applicable to the earthquake affected persons in the districts and blocks notified by the State Government.  Waiver of interest @ 10% p.a. on the each borrowing till 31/03/2003 was allowed under the said scheme notified by Reserve Bank of India. 

(2)               Case of the complainant is that the Opponent Bank sanctioned the borrowing facility of `235 lacs and this entire amount was eligible/qualified to be charged at the concessional rate of interest as per the guidelines under scheme.  However, the Opponent Bank refunded differential interest amounting to `7,37,991.87 on the adhoc limit of cash credit of the complainant, since differential interest on entire cash credit of `235 lacs was not considered for refund.  Repeated requests of the complainant proved futile for refund of the differential interest on entire cash credit.  Aggrieved thereby, this consumer complaint has been filed claiming an amount of `37.14 lacs on account of business loss together with `1 lac as cost of litigation.

(3)               The Opponent Bank appeared and vehemently opposed the claim of the complainant by filing written version.  The first ground in the written version is that the complaint is time-barred as the cause of action arose in the month of December 2005, whereas the complaint has been filed in the month of June 2009 that too without the application for condonation of delay.  The second ground is that adhoc limit of cash credit of `140 lacs [Under caption Cash Credit (hypothecation) adhoc `80 lacs & SOD (Book Debt) `60 lacs = `140 lacs] was sanctioned to the complainant for executing the work within a period of 15 months in Sikka, Jamnagar, Gujarat i.e. in the earthquake affected area and not `235 lacs as presumed by the complainant.  The cash credit of `205 lacs was sanctioned for carrying on unit at Mumbai.  The complainant failed to utilize adhoc limit of `140 lacs for executing UDHE India Ltd. orders for GSFC Ltd., Sikka, Jamnagar, Gujrat within a period of 15 months and not submitted the required certificates from the competent State Government authorities to demonstrate that the work executed was in earthquake affected zone.  The complainant with malafides intention tried to club regular cash credit with adhoc cash credit sanction for execution of project at Sikka, Jamnagar, Gujrat.  Number of works executed by the compla