STATE BANK OF INDIA vs INDUSTRIAL DISTRIBUTORS

APPELLANT Bank which was the Opposite Party before the State Commission has filed this Appeal against the judgment and order dated 21.11.08 passed by the State Consumer Disputes Redressal Commission, Delhi (in short, ''the State Commission '') in Complaint Case No. C-36/20007 whereby the State Commission partly allowing the complaint has directed the Appellant Bank to pay a lump-sum compensation of Rs.50,000/- including costs of litigation to the Respondent. Appellant Bank was directed to return all the hundis in its possession to the Respondent within a month. FACTS:- Complainant/Respondent had business dealings with a firm namely M/s. Telas Sub. Station Equipment. The said firm placed purchase orders upon the Respondent against which the goods were supplied by it. In consideration for the value of goods supplied, Respondent had drawn hundies. As per the agreement between the Respondent and the Firm, the hundies along with the documents of title of goods were to be delivered to the Branch of the Appellant Bank. Appellant Bank ''s Branch was to deliver the documents of title of goods to the firm on the acceptance of the hundi by it. Thereafter, the Branch of the Appellant Bank was to realize the payment of the hundi from the firm on its due date along with the Sales Tax Declaration Form "C " charges. In case of failure of the firm to honour the hundi on the due date the same was to be returned to the Respondent. Respondent was to pay the charges for the said service to the Appellant Bank. Respondent delivered six hundies along with the documents of title of the goods to the Appellant on different time and period. However, the Appellant Bank failed to either realize the payment from the firm on the due date or return the hundies to the Complainant. Respondent wrote letters dated 16.09.98 and 12.12.98 calling upon the Appellant Bank either to realize the payment or return the hundies. Appellant did not respond the said letters. Respondent vide letter dated 14.01.2000 called upon the Appellant Bank to pay the sum of Rs.7,44,786.60 towards the payment of the hundies and over-due interest, but in vain. Complainant, being aggrieved, filed the complaint before the State Commission.

ON being served, the Appellant Bank entered appearance and filed its written statement taking the preliminary objections; that the State Commission, Delhi had no territorial jurisdiction to entertain, try and decide the complaint as the cause of action had arisen in Bhopal, that the complainant was not a ''consumer '' as the services of the Appellant Bank were availed for ''commercial purposes ''; that the complaint was barred by limitation as the cause of action had arisen in 1997 whereas the complaint was filed in 2000. On merits, it was pleaded that the Appellant Bank had returned the original unpaid bill of exchange to the Respondent through Value Payable Post (VPL) however the same were received back with the postal remarks "refused ''; that the Bank could not be made liable to pay compensation for withholding the documents when the documents were returned by the Respondent. State Commission, after considering the facts, pleadings and evidence adduced by the parties, held that the complainant was a ''consumer '' and the Appellant Bank was deficient in service as no efforts were made by it to return the undelivered documents to the Respondent by a messenger or by hand. State Commission partly allowed the complaint and directed the Appellant Bank to pay a lump-sum compensation of Rs.50,000/- including costs of litigation to the Respondent. Appellant Bank was also directed to return all the hundis in its possession to the Respondent within a month. State Commission in its order held as under :- " Main question that calls for determination is whether the OP bank has returned the original documents of unpaid bills for value payable by post or not. In this regard, the OP bank has relied upon the document Ex.CW/15 whereby the postal authority had returned with the remarks ''refused ''. The main problem of the complainant is that in the absence of these documents he could not file suit for recovery. The OP bank does not know as to where these documents are lying. Though there is a presumption of service whenever any parcel or any letter is received with the remarks ''refused '' but such a presumption is dislodgeable if the addressee denies having refused. It was the bounden duty of the bank that these documents are returned even after having received the same and returned undelivered by the postal authority. Efforts could have been made for returning the documents either by a messenger or by hand. Refusal does not mean that the OP bank was empowered to keep the documents particularly when the complainant had sent letter after letters calling upon the bank to return the undelivered documents. "

APPELLANT , being aggrieved, has filed the present appeal. We have heard the Ld. Counsel appearing for the Appellant at some length. Respondent is not present despite service. Ld. Counsel appearing for the Appellant Bank contends that neither the Respondent had any account with the Appellant nor there was any contract between the parties nor any consideration was paid towards the services rendered; that there was no relationship of banker and customer with the Respondent and the collection of documents was undertaken by the Appellant as a measure of ancillary services rendered by it in the capacity of the agent of the Respondent. That the Appellant returned the documents to the Respondent through Value Payable Post (VPL) which were received back with the postal remarks "refused ". That since the documents were received back with the postal remarks "refused ", there was no deficiency on the part of the Appellant in rendering the service. That the documents were returned in the year 1997 to the Respondent whereas the complaint was filed beyond the period of limitation of two years provided u/s 24 A of the Consumer Protection Act, 1986, i.e. in the year 2000 and, therefore, the complaint is liable to be dismissed as time-barred; that there was no territorial jurisdiction for the State Commission, Delhi to entertain and decide the complaint as no part of cause of action arose in Delhi; that the services of the Appellant bank were availed of by the Respondent for commercial purpose which is excluded within the purview of the Consumer Protection Act, 1986; that the Respondent has failed to prove that the efforts were made by it to collect the unpaid documents but the Appellant Bank had refused to deliver the same.

THE facts of the case are not disputed before us. Respondent had business dealing with a firm, namely M/s. Telas Sub Station Equipment. Some purchase orders were placed by the said firm upon the Respondent. Respondent supplied the goods and prepared the hundies for the value of the goods supplied. Respondent delivered six hundies to the Appellant Bank along with the documents of title of the goods supplied. Appellant Bank was to deliver the documents of title to M/s. Telas Sub Station Equipment on acceptance of the hundi by them. Thereafter, the Appellant Bank was to realize the payment of the hundies on due dates and in case of failure to realize the amount the hundies were to be returned to the Respondent. Since the six hundies were received back unpaid, Appellant Bank returned the same to the Respondent through Value Payable Post (VPL) which were received back with the postal remarks "refused ". We do not agree with the view taken by the State Commission that the efforts should have been made by the Appellant Bank to return the unpaid documents by special messenger. Appellant incurred an expenditure of Rs.2,465/- for sending the documents through Value Payable Post which the Respondent refused to accept. Under these circumstances, no deficiency can be attributed to the Appellant Bank as it was not obliged to deliver the documents by special messenger. Respondent has also failed to lead any evidence to show that efforts were made by it to collect the returned documents and the Appellant Bank refused to deliver the same. Finding recorded by the State Commission that the Appellant Bank was deficient in service in not returning the documents by sending the special messenger is totally unwarranted. This apart, the State Commission did not have the territorial jurisdiction to adjudicate upon the complaint. In the complaint the address of the Appellant Bank is mentioned as State Bank of India, Industrial Area, Govind Pura, Bhopal-462-23. The State Commission in its order has mentioned the address of the Appellant as State Bank of India, Parliament Street, New Delhi which is factually incorrect. Even the Ld. Counsel appearing for the Appellant submits that the Respondent had initiated the execution proceedings before the State Commission and matter was settled between the parties on 24.04.09. The order dated 24.04.09 passed by the State Commission, Delhi in Execution Application No.EX-9/06 reads as under:- " On behalf of respondent/JD, copy of order dated 15.04.2009 passed by the Hon ''ble National Commission along with two envelopes alleging containing the original LCS are submitted as per order of the Hon ''ble National Commission. These LCs are to be handed over to the Complainant/Petitioner DH in these execution proceedings. The same are accordingly delivered to the Ld. Counsel for the Petitioner/DH against acknowledgement and further proceedings since stands stayed. Case be listed on 09.07.09 for further orders. "

THE original documents have already been returned by the Appellant to the Respondent. Only dispute which remains to be adjudicated is regarding compensation. Since, we have come to the conclusion that the Appellant was not deficient in rendering the services to the Respondent, the compensation awarded by the State Commission cannot be sustained and is accordingly set aside. For the reasons stated above, the appeal is accepted and the order of the State Commission is set aside. No order as to costs. Registry is directed to refund the sum of Rs.25,000/- deposited by the Appellant as statutory deposit along with accrued interest.