BANK OF INDIA vs Shri Radha Nath Singh , Deepak Agency

THERE has been delay of 13 days in filing revision petition, for which an application for condonation of delay has been filed by petitioner and for the reasons stated therein, the delay is hereby condoned.

RESPONDENT no.1/complainant had taken a loan of Rs.50,000/- from the petitioner/opposite party/Bank under the Prime Ministers Rozgar Yojna for running auto parts shop. Two installments of Rs.20,000/- and Rs.27,000/- were released by the petitioner/ Bank. While after the pre-sanction inspection the first installment was disbursed to the complainant for arranging furniture, signboard etc., the second installment was released after the post-sanction inspection directly to the respondent no.2 (M/s Deepak Agency) by demand draft for sending auto parts to the complainant, under intimation to the complainant that he may contact the respondent no.2 for getting the auto parts. The respondent no.2 neither supplied the goods nor returned the draft to the petitioner/Bank, resulting in wastage of amount of first installment of Rs.20,000/-. In this background, the respondent no.1/complainant filed a complaint before the District Consumer Forum, Dhanbad (District Forum for short), praying for amount of Rs.85,000/- towards repaying the loan amount, damages, mental agony and physical harassment as well as for direction to the petitioner/Bank to return all his academic certificates which were kept by them at the time of sanctioning the loan in his favour. When notice was issued by the District Forum to the petitioner/Bank through courier, they refused to accept the same and on the basis of the report to that effect the District Forum proceeded to dispose of the complaint after hearing the learned counsel for the respondent no.1/complainant. The respondent no.1/complainant contended before the District Forum that the petitioner/Bank in collusion with the respondent no.2 (M/s Deepak Agency) had sent the DD of Rs.27,000/- to the respondent no.2 without his consent, just for extracting commission. The District Forum having admitted the contention of respondent no.1/complainant in absence of any reply on behalf of the petitioner/opposite party/Bank and observing their improper action in not taking any action for recovery of Rs.27,000/- from the respondent no.2 held them to be guilty of taking commission and directed them to pay to the respondent no.1/complainant a sum of Rs.85,000/- within 30 days from the date of the order i.e. 03.06.2004, failing which the said amount was directed to carry interest @ 12% p.a. from 01.09.2003 till the date of actual payment. Against the order of the District Forum, the petitioner/opposite party/Bank filed a time-barred appeal before the Jharkhand State Consumer Disputes Redressal Commission (State Commission for short). The petitioner/ Bank alleged that they had not received any notice from the District Forum and could know about the complaint only on 09.07.2004 when they received a copy its order dated 3.6.2004. Upon receipt of that order, the Bank Manager concerned inspected the records of the case at the District Forum on 12.07.2004 and found that the case was proceeded ex-parte against them on the basis of a report which stated that they had refused to accept the notice sent by the District Forum through courier. After getting sanction/approval from the appropriate authorities and engaging a lawyer to pursue the matter, the petitioner/opposite party/Bank filed an appeal before the State Commission along with delay condonation application. The State Commission while passing its order dated 21.11.2005 observed that no sufficient cause had been made out for condoning the delay and as such dismissed the appeal of the petitioner/opposite party/Bank on the ground of limitation. Hence, this revision petition by the petitioner/opposite party/Bank.

The grounds on which the learned counsel for the petitioner/Bank attempts to find fault with the impugned order are that the State Commission has dismissed their appeal on the ground of delay for a mere 25 days, the reasons for which were duly explained. Considering that certain formalities were required to be completed in obtaining approval etc. and the petitioner being a public sector Bank, he contends that the delay of 25 days ought to have been condoned and the matter should have been heard on its merit, which the State Commission has failed to do and thereby failed to exercise its jurisdiction.

THE final limb of argument of learned counsel for the petitioner/Bank is that while as per the request of the respondent no.1/complainant the Bank had remitted the second installment of Rs.27,000/- to the respondent no.2 (M/s Deepak Agency), the respondent no.1/complainant appears to have connived with the said respondent no.2 and not utilized the same and has made out a false case to derive undue benefit. Learned counsel, therefore, submits that the revision petition be allowed. Learned counsel for the respondent no.1/complainant on the other hand has submitted that the dream of the complainant to set up his self-enterprise and stand on his own has been shattered completely as the Manager of the Bank having sanctioned the loan connived with the respondent no.2, the auto part supplier, and without his consent remitted the working capital amount to the respondent no.2. The respondent no.2, however, despite requests never supplied the required auto parts as a result of which not only his enterprise could not take off but the capital investment made in the preparation of the shop and furniture etc. were also wasted without any gain. It has further been submitted that non-supply of the auto parts by the respondent no.2 was brought to the notice of the Manager of the petitioner/Bank in writing and they in turn had addressed a letter dated 14th of May, 1998 to the respondent no.2 directing him to either supply the auto parts or refund the amount but failed to take any further coercive action against respondent no.2, which goes to prove that the Manager was in connivance with the said respondent no.2. The learned counsel, therefore, submits that there is absolutely no ground for interference with the order of the fora below at the stage of revision.

LEARNED counsel for respondent no.2 (M/s Deepak Agency) while admitting that they had received a sum of Rs.27,000/- for supply of auto parts contends that the respondent no.1/complainant never approached them for supply of the material and they are even now willing to make the said supply. Having heard the learned counsel for the parties and having perused the records of the case, we find this to be a case where attempts made by a young unemployed youth to seize the opportunity of a scheme for self employment introduced by the Government such as the Prime Ministers Rozgar Yojna are frustrated by the conduct of the lending institutions such as the present petitioner/Bank. It is clear from the records that, after the release of the first installment of Rs.20,000/-, which was duly invested by the respondent no.1/complainant for the preparation of his shop premises and purchase of furniture etc., and after a thorough inspection of its proper utilization the petitioner/Bank had sanctioned the second installment of Rs.27,000/- which was to be the working capital. However, there is no explanation whatsoever from the side of the petitioner/Bank as to why this amount, rather than being released to the respondent no.1/complainant was directly sent to respondent no.2, the dealer of auto parts. There is no such agreement prescribing that the working capital would be released only to a dealer/supplier. Even if the Bank did so in order to safeguard its interest, the least that was expected of the Bank was to have consulted the beneficiary respondent no.1/complainant to ascertain as to from-where he would like his purchases to be made and only with his consent the amount should have been sent. In the normal practice, the working capital is credited into the loan account of the beneficiary, who then utilizes the same for the conduct of his business. Departure from the normal practice lends support to the complainants accusation that the Bank Manager wanted to favour respondent no.2. As for maintainability of complaint the order of fora below is sought to be challenged by the Bank also on premises that if date of sanction of loan as also sending over cheque for Rs.27,000/- to dealer is taken into consideration, filing of complaint was grossly time barred as it was not before lapse of six years from date of sanction of the loan by respondent no.1. Though this delay is sought to be negatived by respondent no.1 holding that since there was a continuing cause of action, objection of counsel for petitioner had to be rejected, we do not feel impressed, there being no evidence about any communication having been made by respondent no.1 with the Bank raising his grievance in the matter of sending cheque of Rs.27,000/- to the dealer. However, since loan was sanctioned against the respondent no.1, which he is required to liquidate, the equity requires that for non-receipt of residual part of loan the Bank should restrict liability of the respondent no.1 to the extent he had been in receipt of sanctioned loan. The order of the State Commission, which dismissed appeal for its belated filing, is set aside and the revision petition is disposed of in aforesaid terms.