NOAH INDUSTRIES vs GENERAL MANAGER, KARNATAKA, STATE FINANCE

THE complainant had applied for a loan of Rs. 1,65,000/- from the respondents on 9.6.1986. After processing the application, the respondent sanctioned a loan of Rs. 90,000/- to the applicant and it was released. With that amount, the complainant had started an industry for manufacturing wafers. Later it was declared as a sick unit on 14.8.89. THE complainant applied for rehabilitation assistance to the respondents. THE order dated 25.10.89, the respondents sanctioned additional term loan of Rs. 0.26 lakhs for rehabilitating his sick unit subject to sanction of refinance from the I.D.B.I., to them. Later as the IDBI did not sanction refinance to the respondents, the respondent withdrew that sanction by their letter dated 23.2.1991. Hence, alleging deficiency in service on the part of the respondents, the complainant has filed this complaint for recovery of Rs. 7,50,000/-.

THE respondents have resisted the complaint by contending, inter-alia, that the complainant is not a consumer under the Act; that the KSFC his giving only term loan; that the complainant''s Unit has become sick due to his own making, although the respondents rendered all assistance within its power and jurisdiction; that an additional term loan was sanctioned under the rehabilitation scheme subject to sanction of refinance from the IDBI; that as the IDBI refused to refinance, the respondents sanction was withdrawn and therefore, there is no deficiency in service on the part of the respondents. The IDBI summoned to produce the copy of the letter written by it to the respondents and in response to that summons, they have sent the copy of that letter dated 28.2.1990. So far as the sanction of additional loan of Rs. 26,000/- is concerned, it was subject to refinance by the IDBI as is clear from the letter dated 25.10.1989 produced by the complainant himself and as the IDBI refused to refinance the respondents, the respondents were justified in withdrawing that sanction. Hence, we see no deficiency in service on the part of the respondents to the complainant. Be merely filing an application for additional loan, the complainant also will not be a consumer. The loan should be sanctioned and paid to him and thereafter he will be a consumer, as he will be paying interest on that amount. Here sanction was subject to the sanction by the IDBI and as the IDBI refused to sanction, the sanction was withdrawn. Hence, the complainant will not be a consumer in respect of further loan. In view of that, his complaint is liable to be dismissed. In the result, the complaint is dismissed. Parties to bear their own costs. Complaint dismissed.