Omega Packaging Pvt Ltd vs CENTRAL BANK OF INDIA

THE complainant was enjoying credit facilities from the Opposite Party Bank since 1983 -84. According to the complainant/petitioner eventually the following credit facilities were being extended by the Opposite Party -Bank: 1. Cash Credit on hypothecation amount : Rs. 40 lakhs 2. B.P. (Bill purchases) : Rs. 100 lakhs 3. W.C.T.L. : Rs. 30 lakhs 4. T.L. (Term Loan) : Rs. 12.50 lakhs 5. D.A. Letter of credit : Rs. 20 lakhs

THE complaint is that the Opposite Party Bank had been charging interest arbitrarily, capriciously, capitalizing interest at quarterly rests. It has charged excess interests on bill purchase credit; interest is charged upto date of intimation of realisation of the bills by the Bank and not up to date of realisation; the Opposite Party/Bank has charged excessive interest in violation of the directives of the Reserve Bank of India re: advances since 1983 -84. The complainant also alleged that the current account with the Opposite Party -Bank was converted into a collection account in July, 1988 without notice by Opposite Party No. -Branch Manager, Central Bank of India, Bombay and moneys were transferred to Opposite Party No. 2 -Branch Manager, Bank of India, Valsad, Gujarat. Because of the time of 7 to 10 days taken to effect the transfer of funds, the complainant suffered loss of interest, whereas he had to pay interest on the loan amounts. In this conversion of the current account into a collection account, he suffered a loss of Rs. 3 lakhs by way of interest. 3. The complainant has claimed reimbursement of Rs. 20.60 lakhs by way of excess interest charged by the Opposite Party and compensation of Rs. 49.38 lakhs for the deficiency in service and harassment caused to the complaiant.

THE complaint has been contested by the Opposite Party -Central Bank of India. It is not necessary to go through the detailed reply of the Opposite Party as will be clear from what we have to state later in this order. Presently, we wish to invite attention to a few important contentions of the Opposite Party: (i) The Opposite Party -Bank stated that a notice for recovery of Rs. 1.83 crores with interest and costs was issued to the complainant on the 23rd of February, 1993. The notice, inter alia, points out the ''this party (complainant) has also deceived the Bank by producing fake bills and fake lorry receipts etc. And without supplying any goods to the various parties he has discounted the bills. And the drawees of the Bills have dishonoured the Bills after accepting the same. And he has also submitted false stock -statements to deceive the Bank.'' It has also contended that the interest charged by it is strictly as per the guidelines and directives of Reserve Bank of India. It has further explained that the current account was converted into a collecting account in 1988 but the complainant remained silent up to 1993.

A perusal of the paper book reveals that the allegations of charging excess interest on bill purchase, cash credit, on W.C.T.L. etc. date back to 1983 -84. The complaint petition was filed on 13th April, 1993 and consequently interest alleged to have been charged in excess on the transactions from time to time prior to 13th April, 1990 would be barred by limitation. Secondly, the details of excess interest alleged to have been charged runs into 24 broad sheets (pages 7 to 30 of the paper book) and involving over 700 entries. In short, the transactions to be examined are numerous It would be an impossible task for this commission to scrutinize and take the evidence regarding charge of excess interest.

WE , therefore, consider that having regard to the nature of the contentions raised in this case, there cannot be a satisfactory adjudication of the issues involved in the time bound proceedings under the Consumer Protection Act. This Original petition is dismissed on this short ground without prejudice to the right of the complainant to seek redress for the allegations of excess interest charged by the Opposite PartyBank in a suit if he is so advised. Petition dismissed.