State Bank of India vs Deepam Sizing Mills

BY way of present revision petition there is a challenge to order dated 22.3.2011, passed by State Consumer Disputes Redressal Commission, Chennai (for short as "State Commission" ).

BRIEF facts of this case are that respondent No. 1/complainant consigned goods worth of Rs. 1,56,185 on 4.7.2002, to the consignee M/s Shankar Handloom House, Dehri, Rohatas in Bihar, through respondent No. 2/carrier, entrusting the documents with petitioner for collection of amount from the consignee and credit the same in his account. On inquiry, petitioner informed that they had sent the documents by registered post, whereas the branch at Dehri omitted to inform them regarding the collection of the amount. Under the said circumstances, respondent No. l requested the petitioner to return the bill since the amount was not credited but petitioner refused. The consignee also has not paid the amount. It appears that without the documents viz. lorry receipt and other documents viz. invoice, respondent No. 2 had delivered the goods, which should be construed as negligent act as well as deficiency in service. Petitioner who undertook to collect the amount for which he had also collected some service charges, failed to collect the amount, thereby has committed deficiency.

DESPITE repeated demand and notice, both parties have failed to pay the value or return the goods, or the documents. Accordingly, respondent No. l filed complaint for the recovery of the value of the goods viz. Rs. 1,56,185, with compensation of Rs. 75,000 with cost.

PETITIONER in its written statement has admitted that respondent No. 1 has tendered a bill drawn on Shankar Handloom House, Thana Road, Dehri Onsone, Rohtas, Bihar, under invoice for a sum of Rs. 1,56,185 along with L.R. No. 387179 dated 4.7.2002. Petitioner forwarded the same on 12.7.2002 by Registered Post to their Dehri Branch. Since, respondent No. 1 did not receive either the proceeds or the bill unpaid, it sent a telegram dated 14.8.2002 for returning the bill. Thereafter, petitioner sent another reminder to their Dehri Branch intimating them that it had not received the said letter. The Dehri Branch has found that petitioner had not received the petitioner''s bill for collection. Accordingly, petitioner lodged a complaint, with Head Post Office, Tirupur, regarding non-delivery of registered post. The Head Post Office confirmed that the postal cover was delivered to petitioner''s Dehri Branch on 18.7.2002. Dehri Branch in turn informed the petitioner that the contents of the said postal cover was not the abovesaid bill. It appears that some miscreants have nexus with the postal employees of the Post Office and they have manipulated the said cover. Thus, there is no deficiency on the part of the petitioner.

RESPONDENT No. 2, initially appeared before District Forum, but later on absented and as such was proceeded ex parte.

DISTRICT Forum, vide its order dated 11.4.2008 held that due to the negligence act as well as deficiency in service on the part of petitioner and respondent No. 2, respondent No. 1 was unable to collect the value of the assignment and, therefore, he should be compensated. Accordingly, it directed that petitioner and respondent No. 2, shall have to pay the invoice amount of Rs. 1,56,185 together with interest at 12% from the date of complaint i.e. from 14.8.2003 upto the date of payment and also Rs. 10,000 towards mental agony and Rs. 1,000 towards expenses.

BEING aggrieved by the order of District Forum, petitioner filed an appeal before the State Commission which, vide impugned order, allowed the appeal in part and modified the order of District Forum by setting aside the order of compensation and confirmed the rest of the order of District Forum.

IT is contended by learned Counsel for the petitioner that there is no deficiency on the part of the petitioner in handing over the documents. The documents were despatched through registered post and on non-receipt of the payment, the matter was taken up with the Dehri Branch. Dehri Branch of the Bank has forwarded the envelope and contents thereof received by them to Tiruppur Branch. Thus, no negligence can be attributed to the petitioner''s Bank for the manipulation/loss of the documents in the transit.

IT is also contended that petitioner''s Bank has never assumed the responsibility of getting documents paid. It has assumed the responsibility of only forwarding documents for payment to the Banker of the buyer.

OTHER contention is that the matter of complaint is a commercial transaction and cannot be adjudicated by the Consumer Forums.

IT is also contended that it is well settled that in case the negotiable instrument sent for collection is lost in transit, the banker is not liable for payment for the amount of the bill, but it is liable only for the payment of damages, if negligent. In support, learned Counsel has relied upon a decision of this Commission reported as State Bank of Patiala v. Rajendra Lal and Anr., IV (2003) CPJ 53 (NC).

DISTRICT Forum, while allowing the complaint has held: "It was informed by the Dehri branch, that the bill sent with this letter was not received by them. Therefore, the letter was received by the Dehri Branch. Along with that letter, the statement saying that the bill was not enclosed therewith, is a delayed statement. In such case, what is actually received along with that letter is not clearly stated. Further it is stated earlier that the letter bearing No. 1603 was not received by Dehri Branch. Now it is stated that along with the letter there was no bill, inside the cover. When all these matters are scrutinized carefully, it is observed that 1st Respondent has taken a stand once and another different stand at another place. We decide that the default of service of respondent''s other Bank and the default of service of 1st respondent bank are the reasons for this case. Within getting the original bill, the permission granted by 2nd respondent to clear the goods by consignee is a clear indication of default of service by the 1st respondent and 2nd defendant. Thus, we decide that the applicant has right to get remedy as prayed for."

It further held: "The postal department has advised that they have sent the letter through Registered Post No. 1603 and the same is delivered to the concerned person. The relative documents are also produced. If the postal department has manipulated and removed the contents of the tapal and used for wrongful gains, the 1st respondent bank who sent the post and their Branch at Bihar should have initiated criminal proceedings. The applicant entrusted the work to the 1st respondent after paying commission and the Bank only has to take necessary further action for the mistakes done by others. The 1st respondent and their Dehri Branch have rights to intimate civil and criminal action against the complaint given to the Police Station at Dehri. We, therefore, decide that the omission of inclusion of post office in the case will not affect the course of this case in any way".

STATE Commission, while concurring with the finding of facts of the District Forum, set aside its order with regard to compensation and observed: "6. The complainant, being a business man, had consigned grey sheeting worth of Rs. 1,56,185, to one Shankar Handloom House, Dehri, Onsone Post, Rohtas District, Bihar. Invoice, Lorry Receipts, were entrusted to the 1st opposite party, by the complainant, they being their bankers. The consignment was entrusted to the 2nd opposite party, for delivery to the consignee, on their production of invoice, original Lorry Receipt, etc. Under the Banking system, the consignee, upon intimation, has to pay the amount, to the collecting Bank at Dehri, and on payment of such amount, the Bank will release the documents, crediting the amount, to the account of the consignor. In this case, admittedly, clearing bank has not collected the amount, and the consignee also has not paid the amount. Enquiry revealed that the 2nd opposite party/transport, had handed over the consignment, either to the consignee, or to somebody, without the original lorry receipt. Thus the complainant, unable to realize the amount, as per the established banking system, when questioned for payment, not honoured, resulting consumer complaint. 7. It is the duty of the 1st opposite party to take the responsibility to collect the amount, from its branch at Dehri. The 1st opposite party, cannot simply escape from its liability, as if their duty was over, when they have despatched the documents to the collecting bank. In this case, though an attempt was made to say, that the collecting bank, has not received the original lorry receipt and other connected documents, it is proved, by the certificate issued by the post office, they have delivered the registered post, sent by the 1st opposite party at Dehri branch, as seen from Ex. B6 also. It is known, under what circumstances, the 2nd opposite party delivered the consignment, without the original lorry receipt, and invoice. The above facts are within the knowledge of the 1st opposite party, and its branch at Dehri, as well, within the knowledge of the 2nd opposite party, or its branch at Dehri. They have not explained, under what circums-tances, they have handed over the consigned goods, to the consignee, without the documents, and without collecting the invoice value also. This conduct, and the procedure adopted by the opposite party, should be held as negligent act, followed by deficiency in service. 8. Neither the 1st opposite party, nor its branch at Dehri, cannot escape from the liability, alleging that only a cover, contending some other papers were delivered, in which there was no lorry receipt. If it is so, they ought to have taken action, against the post office concerned, which they failed. For that, it may not be proper to allow the complainant to suffer, since he has not committed any mistake in adopting the procedure, and in view of the admitted position, the 1st opposite party, as well as 2nd opposite party, had collected consideration, for rendering service, failed to do the service, causing deficiency, they should be directed to pay the value of the goods consigned, which was conclusion of the District Forum, in which finding, we are unable to find any infirmity. It is not the case of opposite parties 1 and 2, they have paid the amount, or the consignee has paid the amount, or the complainant has received the goods or something like that. When the goods were entrusted to the 2nd opposite party, it is their duty to deliver the goods to the consignee, as per the lorry receipt, obtaining the original lorry receipt, and invoice, which was sent to the bank for collection. Since they failed and delivered the goods to somebody, the 2nd opposite party also should be held responsible. In our considered opinion, neither the 1st opposite party, nor the 2nd opposite party, can escape from the joint and several liability, since both have committed deficiency. The District Forum, considering the above facts and circumstances of the case, as well as the loss sustained by the complainant, has directed both the opposite parties to pay the value of the goods, which finding should be confirmed. 9. The complainant, has claimed, not only the value of the goods consigned, based upon invoice, but also claimed interest, as well as compensation. The District Forum, has granted interest at 12% from the date of petition, as well as a further sum of Rs. 10,000 for compensation, which may not be proper and permissible, since the mental agony, and other sufferings if any, is compensated by the grant of interest, which the complainant is not otherwise entitled to claim, since it is not a money transaction. In this view, we are inclined to set aside the order of compensation alone."

ADMITTEDLY, respondent No. 1 in this case has rendered the bill under the invoice for a sum of Rs. 1,56,185 to the petitioner and petitioner has forwarded the same for collection by registered post to Dehri branch. However, respondent No. 1 did not receive either the proceeds or the bill unpaid. The postal cover was admittedly received by Dehri Branch of petitioner''s bank but as per Dehri branch version, the bill in question was not in the postal cover and it contained some "unwanted notings". However, those "unwanted notings" purported to have been received in the registered envelope by Dehri branch of petitioner, have neither been placed nor proved on record.

CASE of State Bank of Patiala v. Rajender Lal and Anr. (supra), as cited by learned Counsel for the petitioner, is not applicable to the facts of the present case at all.

IN that case, cheque was dishonoured due to insufficiency of the funds and the same was lost in the transit. It was held, that it is legally open for the complainant to initiate civil/criminal proceedings and as such Bank is not liable to pay the cheque amount. In the case in hand, there is no such thing that the cheque was dishonoured due to insufficiency of the funds.

IN view of the admitted facts as per written statement of the petitioner and as per finding of facts given by two Foras below, deficiency on the part of the petitioner is clearly apparent in this case. We find no reason to disagree with the finding of facts given by two Foras below.

SINCE, there is no illegality or infirmity in the impugned order passed by the State Commission, present revision petition is not maintainable and there is no merit in it.

ACCORDINGLY, the petition stands dismissed with costs of Rs. 10,000 (Rupees ten thousand only). Petitioner is directed to deposit the costs by way of a cross cheque in the name of "Consumer Legal Aid Account" within four weeks from today.

IN case, costs are not deposited within the prescribed period, petitioner shall be liable to pay interest @ 9% p.a., till realization.

LIST the matter on 13th January, 2012 for compliance. Revision Petition dismissed.