COMMANDER S.C. JAIN vs MANAGER, RAJASTHAN FINANCIAL CORPORATION, JAIPUR

THIS appeal has been filed by the complainants against the order of the District Forum, Jaipur dated 17.6.92 dismissing their complaint on a preliminary ground that the complainants did not come within the definition of consumer as defined in the Consumer Protection Act, 1986.

IT appears that the complainants had applied to the Rajasthan Financial Corporation to sanction loan of Rs. 1.44 lakhs for starting a small scale industry. Out of this amount, an amount of Rs. 18,000/- was applied for plant and machinery and the remaining amount for raw materials. The complainants paid Rs. 750/- towards service charges. IT was alleged by the complainants that on 30.9.91 the Rajasthan Financial Corporation disbursed a sum of Rs. 14,625/- to the complainants against the sanctioned amount of Rs. 18,000/- for plant and machinery. The remaining amount of Rs. 3,375/- was not disbursed. The District Forum held that the relationship between the complainants and the Rajasthan Financial Corporation was of creditor and debtor and they did not come within the definition of consumer as defined in the Act. On this ground their complaint was dismissed. Aggrieved by this order the complainants have filed this appeal. Appearance was put on behalf of the respondent on 10.5.93 and 14.7.94 but none is present today. We, therefore, heard the appellant No. 1 appearing in person.

The expression "service" has been defined in Section 2(o) of the Consumer Protection Act, 1986 as meaning service of any description which is made available to potential users and includes the provision of facilities in connection with banking, financing, insurance, transport etc. It would appear from this definition that provision of facilities in connection with financing is included in the definition of service. It was complainants'' case that they had paid service charges of Rs. 750/- to the Rajasthan Financial Corporation. It was also their case that the Rajasthan Financial Corporation had sanctioned a loan amount of Rs. 1.44 lakhs to them. However, despite sanction the Rajasthan Financial Corporation only disbursed a sum of Rs. 14,625/- as against the sanctioned amount of Rs. 18,000/- for plant and machinery. After financial assistance is sanctioned by a financial institution, it implies that it has afforded facility of financing to the prospective user. The consumers therefore, come within the definition of availers of service afforded by the Rajasthan Financial Corporation for consideration. The District Forum should not, therefore, have dismissed the complaint on preliminary ground that the complainants were not consumers. The District Forum should have decided the complaint after giving opportunity to both the parties to adduce evidence on merits of the case instead of dismissing it on preliminary point.

WE, therefore, allow this appeal, set aside the order of the District Forum, Jaipur dated 17.6.92 and remand Complaint Case No. 201/92 to the District Forum, Jaipur to restore the complaint to its original number and to decide it after giving opportunity to the parties to adduce evidence on its merits and in accordance with law. Appeal allowed.