James vs Federal Bank Ltd.

DENYING the various allegations made in the complaint and also resisting the claim for granting reliefs prayed for in the complaint the opposite parties inter alia contended that "the dispute involved in the petition cannot be adjudicated before this Hon''ble Commission as it involves complicated question of facts and law. It also requires taking of elaborate evidence from many witnesses. In a summary procedure a case of sort mentioned above cannot be adjudicated by a Fora constituted under the Consumer Protection Act and the parties will have to be relegated to the Civil Court".

THE highest Court of the country had occasion to consider the question when a Forum can ask a complainant to approach the Civil Court in CCI Chambers Co-op. Housing Society Ltd. v. Development Credit Bank, III (2003) CPJ 9 (SC)=V (2003) SLT 185= AIR 2003 SC 5882 and held that it is only when the dispute arising for adjudication is such as would require recording of lengthy evidence not permissible within the scope of a summary inquiry that a Forum under the Act may ask the complainant to approach the Civil Court. Supreme Court laying down the law made the following observations : (6) It cannot be denied that Fora at the National level, the State level and at the District level have been constituted under the Act with the avowed object of providing summary and speedy remedy in conformity with the principles of natural justice, taking care of such grievances as are amenable to the jurisdiction of the Fora established under the Act. THEre Fora have been established and conferred with jurisdiction in addition to the conventional Courts. THE principal object sought to be achieved by establishing such Fora is to relieve the conventional Courts of their burden which is ever increasing with the mounting arrears and where at the disposal is delayed because of the complicated and detailed procedure which at times is accompanied by technicalities. Merely because recording of evidence is required, or some questions of fact and law arise which would need to be investigated and determined, cannot be a ground for shutting the doors of any Forum under the Act to the person aggrieved.

(7) In the Indian Medical Association case (supra) this Court noticed the powers conferred on the several Fora under the Act, the procedure applicable (including the exercise of some powers of the Civil Court under the Code of Civil Procedure having been made available to the Fora under the Act) and held that the nature of averments made in the complaint is not by itself enough to arrive at a conclusion that the complaint raises such complicated questions as cannot be determined by the NCDRC. It is only when the dispute arising for adjudication is such as would require recording of lengthy evidence not permissible within the scope of a summary inquiry that a Forum under the Act may ask the complainant to approach the Civil Court. THE Fora made available under the Act are in addition to. In Synco Industries case (supra) this Court upheld the order of NCDRC holding the complaint before it not a fit case to be tried under the Act and allowing liberty to the complainant to approach the Civil Court because this Court agreed with the opinion formed by the Commission that "very detailed evidence would have to be led, both to prove the claim and thereafter to prove the damages and expenses". THE Court concluded that in any event it was not an appropriate case to be heard and disposed of in a summary fashion".

(8) In Amar Jwala Paper Mills (India) and Another case (supra) this Court set aside the order of NCDRC relegating a complainant to a Civil Court in spite of the complexity of the matter because the hearing had almost concluded before the Commission.

(9) In Dr. J.J. Merchant and Others case (supra) this Court dealing with the contention that complicated questions of facts cannot be decided in summary proceedings held -"this submission also requires to be rejected because under the Act, for summary or speedy trial, exhaustive procedure in conformity with the principles of natural justice is provided. THErefore, merely because it is mentioned that the Commission or Forum is required to have summary trial would hardly be a ground for directing the consumer to approach the Civil Court. For the trial to be just and reasonable, a loan drawn delayed procedure, giving ample opportunity to the litigant to harass the aggrieved other side, is not necessary. It should be kept in mind that the Legislature has provided an alternative, efficacious, simple, inexpensive and speedy remedy to the consumers and that should not be curtailed on such ground. It would also be a totally wrong assumption that because summary trial is provided, justice cannot be done when some questions of fact are required to be dealt with or decided. THE Act provides sufficient safeguards."

and not in derogation of the provisions of any other law for the time being in force and the jurisdiction of the conventional Courts over such matters as are now cognizable under the Act has not been taken away. A three-Judge Bench of this Court recently in Dr. J.J. Merchant and Others case (supra), specifically dealt with the issue as to the guidelines which would determine the matter being appropriately dealt with by a Forum under the Act or being left to be heard and decided by a Civil Court. This Court noticed that the Fora under the Act are specifically empowered to follow such procedure which may not require more than or delay the proceedings. A Forum under the Act is entitled, and would be justified, in evolving a procedure of its own and also by effectively controlling the proceedings so as to do away with the need of a detailed and complicated trial and arrive at a just decision of the case by resorting to the principles of natural justice and following the procedure consistent with the principles thereof, also making use of such of the powers of Civil Court as are conferred on it. THE decisive test is not the complicated nature of the questions of fact and law arising for decision. THE anvil on which entertainability of a complaint by a Forum under the Act is to be determined is whether the questions, though complicated they may be, are capable of being determined by summary inquiry i.e., by doing away with the need of a detailed and complicated method of recording evidence. It has to be remembered that the Fora under the Act at every level are headed by experienced persons. THE National Commission is headed by a person who is or has been a Judge of the Supreme Court. THE State Commission is headed by a person who is or has been a Judge of the High Court. Each District Forum is headed by person who is, or has been, or is qualified to be a District Judge. We do not think that mere complication either of facts or of law can be a ground for the denial of hearing by a Forum under the Act. So the crucial question that is to be considered by us at this stage is whether applying the principles laid down in the above cited decision the complainant is to be asked to approach the competent Civil Court.

The fact that the complainant availed of 832 gold pledge loans from Kunnathukal branch of the first opposite party, Federal Bank under the head ''Gold Loan'' (GL) and "Short Term Gold Loan" (STGL) is not in dispute. Opposite parties case set up in the written version is that the petitioner over a period of time had availed 832 gold pledged loans from the 2nd opposite party branch. The petitioner was continuously availing the said facility. Over a period of time mutual trust had developed and there was no reason to suspect the quality/purity of ornaments pledged by the petitioner. It is the case of the opposite parties that the ornaments placed at the disposal of the Bank for availing gold pledged loans were not subjected to detailed scrutiny as the complainant was regular customer. Opposite parties case is that in October, 2002 when inspection wing of the Bank while inspecting the ornaments pledged with the Bank found that out of 854 lots of pledges outstanding in the name of the complainant herein, 102 lots fully contained ornaments made of spurious substances and 37 lots partially contained ornaments made of spurious substances. Thus the opposite parties denied assertion made in the complaint to the effect that all the gold ornaments pledged by the complainant which the opposite party bank''s Kunnathukal branch are very good items and good gold.

IT is not disputed before us the fact that as 139 lots of items of the ornaments pledged by the complainant were found by the inspection party as spurious gold ornaments case has been registered under Sections 406 and 420 of the Indian Penal Code against the complainant for committing cheating and other offence. The Sub-Inspector of Police, Vellarada Police Station registered a case against the complainant as Crime No. 447/2002 and it is also not disputed before us that those items pledged by the complainant were seized by the police during the course of investigation and the same were produced before the Judicial First Class Magistrate Court-III, Neyyattinkara. Those items are in the custody of Judicial First Class Magistrate, Neyyattinkara. In a summary inquiry prescribed under the Consumer Protection Act this Commission cannot go into the question whether the 139 lots of ornaments pledged with the Kannathukal branch of the Federal Bank are spurious ornaments or not. A competent Magistrate Court took cognizance of the offences alleged to have been committed by the complainant and burden is on the prosecution in the criminal case to prove the case that the ornaments involved in that crime are not pure gold ornaments but suprious. For proving the fact that spurious ornaments were pledged with bank each item said to be spurious is to be examined by the expert and expert is to be subjected to cross-examination of the report is against the complainant if he so chooses and requires recording of lengthy evidence not permissible within the scope of summary inquiry. This Commission is not competent to decide the question whether the offences under Sections 406 and 470 were committed by the complainant by pledging spurious ornaments. The other ground which impels us to ask the complainant to approach the Civil Court is that the opposite party filed an application before the Debt Recovery Tribunal, Ernakulam as O.A. No. 264/2003 seeking recovery of the loan amount availed by the complainant by pledging ornaments and according to the opposite parties as on 5.10.2002 the total pledge amount outstanding was Rs. 24,39,200/-. The relief sought for in the complaint are : (a) to direct the opposite parties to release 345 Nos. of gold ornaments (309 STGL + 45 GL) in the annexure by receiving the principal amount with interest up to 9.1.2003 or to order to realise Rs. 24,38,500/- in the Schedule No. II (substracting the loan amount of Rs. 24,39,200/- from Rs. 48,77,700/- the total market value of the entire gold items (309 STGL + 45GL) in Schedule No. 1) with interest at 18% per annum from the opposite party Nos. 1 to 3 jointly and severally or from their assets;

(b) to order directing the opposite party to give adequate compensation of Rs. 40,00,000/- for the mental pain and agony which the petitioner has been suffering and for loss of reputation of the J.S. Bankers as stated in schedule No. III;

(c) to order directing the opposite parties to return the petitioner''s blank signed cheque, two signed blank stamp papers and two signed white papers to the petitioner.

(d) to order all the costs of the petitioner; and

(e) such other reliefs as claimed by the petitioner from time to time which this Hon''ble Commission deems fit.

AS there is a case for the opposite parties that out of 345 lot of gold ornaments pledged with the Bank 139 lots are spurious and until it is finally proved that no spurious gold ornaments were pledged with the Bank by the complainant 1st relief sought for cannot be granted. We may also point out here that case of complainant that he went to bank for getting released 18 items pledged by him is disputed by the opposite parties. It is clear from the allegations made in the complaint that ornaments pledged with him were repledged by him and it may appear that he was repledging the ornaments for commercial purpose. Though complainant asserts that for eking out his livelihood he used lending money on getting pledged with him gold ornaments and repledged the same for raising funds. The word self-employment is not defined in the Consumer Protection Act. Therefore, it is a matter of evidence, unless there is evidence to show the loans were given on pledging ornaments and pledged ornaments were repledged by the complainant himself and no employee is appointed to assist him (complainant includes his family members) it cannot be said that complainant is eking out his livelihood from the business carried on by him. However it is not necessary for us at this state to decide that question. We are of the view that the dispute arising for adjudication before us requires recording of lengthy evidence not permissible within a scope of summary inquiry and the only course open before us is to return the complaint to the complainant asking him to approach the competent Civil Court for granting him reliefs prayed for by him. Hence return the complaint to the complainant and it is open to the complainant to approach the competent Civil Court for redressal of his grievance. Complaint returned.