Manager Zila Sahakari Kendriya Bank Ltd vs Hari Narayan Bhargava

THIS revision petition is directed against concurrent judgements rendered by the District Forum and the State Commission whereby complaint of respondent was allowed.

THE revision petition involves a significant question of law as to whether refusal of the Petitioner Bank to credit amount of Gratuity and Group Insurance in the account of the respondent can be branded as deficiency in the banking service as contemplated under Section 2 (o) of the Consumer Protection Act, 1986. Before embarking upon determination of the above referred clinching question, it would be useful to set out the factual matrix. Undisputedly, the deceased respondent (complainant) was Manager of the Petitioner Bank. It appears that he was superannuated on 31.1.2001. There is no dispute about the fact that the amount of Gratuity and Group Insurance Scheme was payable to the respondent on account of his superannuation. The amount had not been, however, paid to him. As an employee of the petitioner, the respondent was having A/c. No. 36 in the Petitioner''s Bank. The Petitioner Bank noticed that certain amounts were recoverable from the respondent being the amounts, which were retained by him or given to him by way of advance. The Petitioner Bank found that total amount recoverable from the respondent was Rs.2,12,588.94 along with future interest. In view of the recovery to be made from the respondent, the Petitioner Bank withheld the said amount of Group Insurance Scheme and the gratuity, though, by the time such amounts were available, the respondent was paid provident fund of Rs.2,96,841/ and encashment of leave to the tune of Rs.65,964/ .

THE respondent (complainant) filed complaint under Section 12 of the Consumer Protection Act, 1986 alleging that the Petitioner Bank committed deficiency in the service by not depositing his due amount of gratuity and Group Insurance Scheme in his account. It was the case of the Petitioner Bank that internal inquiry was conducted after the retirement of the respondent. A report of Deputy Director was received by the Petitioner Bank on 16.8.2001. As per the inquiry report, the respondent was found guilty of withholding and misappropriation of funds and, therefore, a departmental inquiry was proposed. The amounts were, therefore, adjusted towards the excess payment or the misappropriated amounts and as such, there was no deficiency in the banking service.

BOTH the Fora below held that the amount payable to the respondent could not have been withheld by the Petitioner Bank in contemplation of departmental inquiry. The State Commission held that the inquiry was conducted by the Deputy Director without observing principles of natural justice and, therefore, the amounts payable to the respondent could not have been withheld by the Petitioner Bank. Relying upon the case of Radheshyam Khichrolia Vs. M.P. State Co operative Marketing Federation Ltd. and Anr. '' 2002 (3) MPLJ 288, the State Commission held that in absence of any provision made for continuance of departmental inquiry after the superannuation, the Petitioner Bank had no legal authority to take action by way of punishment or recovery. The State Commission also held that since there was no departmental inquiry instituted during the service tenure of the respondent, there was no question of continuation of such departmental inquiry. In this view of the matter, the State Commission dismissed the appeal of the Petitioner Bank and confirmed judgement of the District Forum whereby the payment of gratuity and Group Insurance Scheme was directed to be paid to the respondent (complainant) along with the cost of Rs.500/ . We have heard learned Counsel for the parties. We have also perused the relevant record and the judgments cited by the Counsel for the parties.

THIS is not a case in which the respondent was ordinary customer of the Petitioner Bank. His Bank A/c. No. 36 was opened by him with the Petitioner Bank as per terms of the service contract. In other words, it was compulsory for him to open the Bank A/c., which was to be utilized for the purpose of depositing the payments of salary, arrears and like amounts. He was not charged by the Petitioner Bank anything for rendering the banking services. Needless to say, though, he was a customer, yet, he was being given gratuitous services as part of his service contract with the Petitioner Bank. In case of service hired by the consumer, a service provider may be liable to indemnify the consumer for any loss caused due to deficiency in the service. For this purpose, it would be useful to refer Section 2 (o) of the Consumer Protection Act, 1986. Section 2 (o) defines the word ''Service'' as follows: Section 2 (o): "service" means service of any description which is made avail''able to potential users and includes, but not limited to, the provision of facilities in connection with banking, financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, housing construction, entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service; (Emphasis supplied by us) Perusal of Section 2 (1) (o) would make it amply clear that expression ''service'' does not include the rendering of any service free of charge or under a contract of personal service. Obviously, where any service is provided without payment of charges or is provided in pursuance of contract of personal service, the subject matter will not come within the ambit of the Consumer Protection Act, 1986.

A distinction is to be drawn between ''a contract for service'' and ''a contract of service''. In one case, the master can order or require what is to be done while in the other case, he needs not only order to require what is to be done, but how it shall be done. There is also a clear cut distinction between ''a contract between a consumer and service provider'' and ''a contract of service'' as an employee. The contract between master and servant is always of different character from the contract of service between the consumer and the service provider. In case of contract between consumer and service provider, the consumer is in commanding position because he is required to pay the necessary service charges and seeks to obtain services as per his requirement. He can maintain a complaint that the service rendered to him was of inferior quality or that there was deficiency in the service or that the service was not rendered in spite of the payment of charges made by him. Still, however, in case of service of an employee, there is absolutely no dominance of the employee likewise one available to consumer. Obviously, the exclusion of service under a contract of personal service will have to be understood having regard to the nature of service for which the complaint is lodged with the Consumer Forum. In ''Kishan Kumar Gupta Vs. G.M. Bank of India and Ors.'' I (2003) CPJ 152 (NC), it was noticed by this Commission that the complaint by employee regarding alleged refusal of pension was outside the scope of the Consumer Protection Act, 1986 and, therefore, the complaint was dismissed. This Commission held that service of the Bank of India was not hired by the employee i.e. complainant, K.K. Gupta and, therefore, the complaint was the abuse of process of law. Needless to say, the Consumer Fora had no jurisdiction to consider whether the amount of gratuity and insurance was illegally withheld by the Petitioner Bank. The Petitioner Bank relied on Section 58 B of the M.P. Co operative Societies (Amendment) Act, 2004. We find it difficult usurp the jurisdiction, which is exclusively available to the competent authority having the authority to decide the dispute arising out of such service matter. It is true, no doubt, that Section 3 of the Consumer Protection Act is in addition to other remedies available and, therefore, in appropriate case, such dispute may be examined by the Consumer Forum. However, when the service required to be rendered by the Petitioner Bank was gratuitous and part of the service conditions of the employee i.e. complainant then the dispute could not be within the ambit of Section 2 (1) (o) of the Consumer Protection Act, 1986.

ON behalf of the respondent, the learned Counsel invited out attention to judgement delivered by this Commission in ''Venkatesh and Ors. Vs. Vishwanath and Ors.'' I (2008) CPJ 219 (NC). It appears that the question pertaining to scope of Section 2 (1) (o) was not considered and decided in the given case. Similarly, learned counsel invited our attention to ''Chairman and Managing Director, UCO Banks and Ors. Vs. M.R. Pandit '' IV (2004) CPJ 27 (NC). In that case, the complainant had taken advantage of the Voluntary Retirement Scheme (VRS). There was change in the scheme and, therefore, the transfer of his amount to the Savings Bank A/c. had caused a loss of 2% p.a. to him due to change in the interest rate. The deficiency was found on account of transfer of the amount done without consent of the complainant and prior to maturity period. The fact situation in that case was on different footings because the employee had not been denied any benefit arising out of his service but was deprived of the due interest due to wrong action of the Bank.

WE may mention here that in both the above cited cases, this Commission referred to the case of ''Regional Provident Fund Commissioner Vs. Shiv Kumar Joshi'' '' III (1999) CPJ 36 (SC). We have gone through the judgement in Regional Provident Fund Commissioner (Supra). In that case, it is laid down that the employees availing the E.P.F. Scheme under the Employees Provident Fund Scheme are ''consumers'' qua the Commissioner of Provident Fund. That was not a subject matter of service jurisprudence as lis was not between the employer and the employee. The Supreme Court held that the contribution of the employee has to be equal to the contribution payable by the employer in respect of such employee. The administrative charges are required to be paid as shown in para 30 of the said scheme and are also paid for consideration of the employee being the member of the scheme. Here lies the real distinction. The service of the Regional Provident Fund Commissioner (Supra) is hired on account of contribution of the charges payable by the employee for becoming member of the scheme. In the present case, no service charges were recovered by the Petitioner Bank for opening the A/C. No. 36 in the name of the respondent employee. The complaint was, therefore, outside the ambit of the Consumer Protection Act, 1986. We are of the opinion that in case of gratuitous service available to the employee of the Petitioner Bank, in respect of the banking account, the service cannot be within the ambit of Section 2 (1) (o). Apart from that, when the amount was withheld for the reason that certain amounts were recoverable from the respondent (complainant), the complaint was not for deficiencies in the personal service. In ''Manorama Tiwari Vs. State of Rajasthan'' '' 1991 (2) CPR III (NC), this Commission held that a complaint by the wife of the employee in the matter of payment of salary and allowances to her husband could not be entertained under the Consumer Protection Act. For, that was the service under the personal contract between the Government and the employee.

TAKING overall view of the matter, we are of the opinion that the complaint could not have been entertained by the District Forum and that both the Fora below committed patent error while allowing the complaint in ignorance of the import of the expression ''service'' as used in Section 2 (1) (o) of the Consumer Protection Act, 1986. Hence, the impugned orders are unsustainable and are liable to be set aside. We, therefore, allow the revision petition accordingly and set aside the impugned orders. No costs.