Mahendra Kumar Jain vs BRANCH MANAGER, M.P. FINANCIAL CORPORATION

THIS appeal is directed against the order dated 18.10.93 passed by the District Forum in Case No. 17/92.

THE appeal arises out of a complaint filed by the appellant. Briefly the appellant''s case was that on payment of requisite service charges and after processing the application of the complainant the opponent-Corporation agreed to advance the amount as alleged in the complaint. It was averred that there was unjustifiable delay in advancing the amount even after the sanction, contrary to the terms agreed upon and as such there was deficiency in service on the part of the opponents which entitled the complainant to claim compensation. THE claim was resisted by the opponents on the preliminary ground that the complainant was not a consumer and hence was not entitled to any relief under the Consumer Protection Act, 1986. This objection was upheld by the District Forum and the complaint was dismissed. Hence the complainant has filed this appeal. Mr. B.V. Bhargava, learned Counsel for the appellant contended that the District Forum erred in holding that the complainant was not a consumer entitled to any relief under the Act. It was contended that the case of the complainant was that there was deficiency in service which the opponents had agreed to render to the complainant and without ascertaining the veracity of facts as alleged by the complainant the District Forum erred in holding that the complaint was not maintainable. In reply it was contended that the complainant was not a consumer as defined by Clause (d) of Section 2(1) of the Act and the District Forum, therefore, rightly held that the complaint was liable to be dismissed. Reliance was placed on the decision reported in III (1992) CPJ 105 (Krishan Bihari Vyas v. Rajasthan Financial Corporation) and II (1994) CPJ 416 (Khanchand T. Sawlani v. Rajasthan Financial Corporation).

As the District Forum has not gone into merits of the case, the only question for consideration at this stage is whether the District Forum was right in holding that the complainant was not a consumer. Now it was not the case of the complainant that his application for grant of loan was rejected by the opponents. If that had been the case of the complainant, the learned Counsel for the opponent was right in contending that the complaint was not maintainable. The decisions relied on by the learned Counsel for the opponents are, therefore, distinguishable on facts. In the instant case the grievance of the complainant is that though a loan was sanctioned to the complainant on certain terms and conditions yet the opponents failed to comply with those terms, and there was, therefore, a case of deficiency in service which entitled the complainant to grant of relief. In view of the allegations made in the complaint, the District Forum in our opinion, was not justified in holding that the complaint was not maintainable. The District Forum should have decided the question as to whether the opponents had agreed to render financial services to the complainant for consideration as alleged. In case these allegations are found to be true, then the complainant would be entitled to relief in case of any deficiency in service. We may usefully to refer to the following observations in G. Palaniswamy v. State of Tamil Nadu and Others 1994 (3) CPR 462 : "The 2nd and 3rd Opposite Parties are the Tamil Nadu Industrial Investment Corporation and its Branch at Nandanam. The complainant has applied for and obtains a term loan of Rs. 47,000/- from the Tamil Nadu Industrial Investment Corporation, as evidenced by Ex. B-l loan sanction order, dated 9.4.84 on the hypothecation of the machineries. Ex. B-2 is the Hypothecation Deed executed by the complainant in favour of the Tamil Nadu Industrial Investment Corporation. The Opposite Parties 2 and 3 render financial services and the borrower is, therefore, a consumer, who avails of the services for consideration, the consideration being the interest payable on the loan."

In our opinion, therefore, the District Forum was not justified in dismissing the complaint without ascertaining the veracity of facts as alleged by the complainant. The order passed by the District Forum dismissing the complaint deserves to be set aside.

CONSEQUENTLY this appeal is allowed. The order dated 18.10.93 passed by the District Forum is set aside. The District Forum is directed to decide the case on merits in accordance with law. Parties shall bear their own costs of this appeal. The record of the case be sent back to the District Forum. The District Forum should proceed to dispose of the case expeditiously in accordance with law. Appeal allowed.