State Bank of India vs MITHAN LAL KALRA RICE AND GENERAL MILLS

-THIS order will dispose of Appeal No. 434 of 2004 (State Bank of India v. Mithan Lal Kalra Rice and General Mills) and Appeal No. 435 of 2004 (State Bank of India v. Evershine Solvex Pvt. Ltd.) as questions oflaw and facts involved in both the appeals are the same. For the sake of convenience, facts are taken from Appeal No. 434 of 2004 and the parties would be referred by their status in this appeal.

THE respondents availed the cash credit limit from the appellants to the tune of Rs. 70 lacs and opened account No. 01559/075040. An amount of Rs. 55,53,839 was outstanding against the respondents against this account. The talks of settlement took between the parties and the respondents agreed to make the payment of Rs. 60 lacs in full and final settlement of the claim of the appellants under this account. The respondents had made the offer vide their letter dated 15. 2. 2001 which was accepted by the appellants in their meeting held on 3. 3. 2001. This amount of Rs. 60 lacs was to be deposited by the respondent with the appellants within one month from the date of approval of the offer on 3. 3. 2001 i. e. upto 4. 4. 2001. The respondents could not deposit the amount by the stipulated date and the appellants vide their letter dated 2. 6. 2001 informed the respondents that the compromise offer stood cancelled. However, the respondents vide their letter dated 12. 7. 2001 informed the appellants that the delay was caused as the property of the respondents could not be sold and undertook to make the payment after 19. 7. 2001. However, by the subsequent letters dated 18. 7. 2001 and 22. 7. 2001 respondents again prayed for time to deposit the settled amount and the entire amount of Rs. 60 lacs was paid upto 15. 2. 2001. The account was closed for which the appellants issued the statement of account.

The respondents opened a fresh current with the appellants bearing account No. 01050/075132 and they started operating it. The appellants had also opened this account in their bank accepting the preposition that the cash credit limit account of the respondents was fully settled and closed. An amount of Rs. 2,03,561 was lying deposited in current account bearing account No. 01050/075132. However, the appellants transferred this amount in the earlier cash credit limit account allegedly towards the interest outstanding against the respondents in the said account whereas no amount of interest was outstanding against the respondents in the cash credit limit account which was finally settled and closed. Therefore, the respondents filed the complaint in the learned District Consumer Disputes Redressal Forum, Muktsar (in short "district Forum'') challenging the action of the appellants for transferring this amount from one account to the other account without the permission and consent of the respondents.

THE appellants filed the written statement. Preliminary objections were pleaded and the case was also contested on merits. It was admitted that the amount outstanding against the respondents in the cash credit limit account was settled under the ''one time settlement'' scheme but the respondents had failed to abide by commitment/schedule of payment as stipulated under the relief agreement. Since the compromise deed was defaulted by the respondents and the deal was rescinded, the conditions settled in the subsequent compromise had been kept concealed by the respondents. The respondents were to pay the interest for the defaulting period and the respondents themselves had made the payment of Rs. 2,03,561 towards the interest for the delayed period. Hence dismissal of the complaint was prayed. The respondents placed on file the affidavit of Ravi Kalra @ Ravinder Kumar as Ex. C-A and also proved documents Ex. C-1 to Ex. C-12. On the other hand, the appellants produced on file the affidavit of Mr. A. K. Bhatia, Chief Manager, State Bank of India, Muktsar Branch as Ex. O. P. 1 and also proved documents as Exs. O. P. 2 and O. P. 3.

ON the basis of this evidence the learned District Forum accepted the complaint vide impugned order dated 5. 12. 2003 with consolidated compensation for mental tension and litigation expenses of Rs. 7,200 and directed the appellants to refund the amount of Rs. 2,03,561 with interest at the rate of 12% per annum from 23. 2. 2002 till the date of its payment. Hence this appeal. The facts are not disputed. The respondents were to make the payment in the cash limit account No. 01559/075040 and a compromise was reached between the parties on 3. 3. 2001 by which the respondents were to make the payment of Rs. 60 lacs upto 4. 4. 2001 in full and final settlement of the outstanding amount against this account. It is also undisputed that the respondents had failed to make the payment of this amount by the stipulated period and ultimately the amount was paid by them upto 15. 12. 2001.

NOW, the question arises whether the appellants are entitled to the interest amount for the delayed period from 4. 4. 2001 to 15. 12. 2001.

IN the affidavit (Ex. C-A) Ravi Kalra @ Ravinder Kumar has deposed on behalf of the appellants that after accepting Rs. 60 lacs from the respondents on 15. 12. 2001 no amount was outstanding against the respondents against this account and the appellants themselves had issued the statement of account declaring the said account to have been closed as fully and finally settled. A copy of the statement of account has been proved as Ex. C-7. This statement clearly reveals that the appellants had accepted this amount finally on 21. 12. 2001 and the balance was shown as nil and the account was closed by the appellants. The appellants had also issued a certificate on 22. 4. 2002 Ex. C-9 that nothing was outstanding against the respondents under this account. However, the appellants had failed to place on the file any document to show if there was any agreement between the parties by which the respondents were liable to pay interest on the delay in making the payment of settled amount. Since the appellants had been accepting the amount under ''one time settlement'' without raising any objection regarding the payment of interest on the delayed payments. It would be deemed that the delay has been waived. Moreover, when the appellants have themselves given the statement of accounts by which no amount was shown as outstanding against the respondents against this account on 21. 12. 2001 and they have given a certificate to that effect on 22. 4. 2002 (Ex. C-9) then the appellants cannot assert a right to claim interest because of the delay on the part of the respondents in making the payment of settled amount. The appellants also failed to place on file any document to show if an amount of Rs. 2,03,561 was the interest amount or any document to show as to on what rate the interest and for what period. They have also not placed on the file any agreement to show if this amount was decided to be the interest amount under ''one time settlement''. The appellants cannot be permitted to abuse their fiduciary relationship to exploit the helplessness of their customers.

The version of the appellants was that this amount of Rs. 2,03,561 was not transferred by the appellants of their own. Rather this payment was made by the respondents themselves by issuing a cheque dated 21. 3. 2002 copy of which has been proved on the file as Ex. O. P. 2.

THIS submission has been considered. This cheque, of course, has been issued by Anand Enterprises but this is in favour of M/s. Mithan Lal Kalra R/g. It is not in favour of the appellants. This cheque dated 21. 3. 2002 copy of wich is Ex. O. P. 2 does not reveal if by this cheque the respondents wanted to make the payment of Rs. 2,03,561 in favour of the appellant Bank. Therefore, this submission of the appellant Bank cannot be accepted.

IN view of the discussion held above, we are satisfied that the action of the appellants in appropriating this amount of Rs. 2,03,561 towards the alleged interest of the delayed payment of the settled amount is totally arbitrary and is a concocted version. We intended to reduce the rate of interest from 12% p. a. to 9% p. a. but since the appellants have abused their position, therefore, we do not feel inclined to reduce the rate of interest. Both these appeals are dismissed with costs of Rs. 2,000 in each case. The appellants deposited an amount of Rs. 25,000 each at the time of filing of both these appeals in this Commission. These amounts along with interest accrued thereon, if any, be remitted by the Registry to the respondents in each case by way of crossed cheque/demand draft after the expiry of 45 days. The remaining amount shall be paid by the appellants to the respondents immediately. The arguments were heard in these cases on 14. 2. 2008 and the orders were reserved. Now the order be communicated to the parties.

THE appeals could not be decided within the statutory period because of heavy pendency and non-availability of the requisite Benches and infrastructure in the State Commission, for which the State Government has already been requested. Appeals dismissed.