UCO BANK vs BHOGALS

THIS is an appeal arising from the common order passed by the State Consumer Disputes Redressal Commission, Haryana at Chandigarh. It appears that the respondent approached the appellant Bank for facilities sometime, on or about 25th February, 1989 for the first time and got the facilities sanctioned. At the time of approaching the Bank for facilities and opening the Account, no disclosure was made of the fact that the appellant was one of the 1984 riot victim. It was a commercial loan and overdraft facilities were sanctioned on the terms and conditions contained in the sanction letter of the Bank. In the meantime, in the year 1992 the Reserve Bank of India had come out with a scheme of Grant of Interest Subsidy by Nationalised Banks to the 1984 riots victims. This benefit was available, provided the applicants fulfilled certain conditions and not otherwise. Under the said scheme, the lending Banks had to grant that benefit of the said subsidy to the parties who were covered by the term "Deserving Case" as defined under the said Scheme. Such subsidy was not to be granted by the Reserve Bank of India. Under that scheme, every party was required to submit an application and the scheme expired on 31st March, 1994. Incidentally on that very date i.e., the last date, the respondents made an application claiming to be a riot victim and asking for interest subsidy under the Central interest Subsidy Scheme meant for November, 1984 riot victims. Some of the salient features of the said scheme are : "The term ''Deserving Case'' is defined as under : (f) ''Deserving case'' means eligible loans granted to a borrower who in the opinion of the Authority which has sanctioned the loan does not have, on the effective date, capacity to pay interest at the rates prescribed by instructions/interest rate directives on advances issued by the Reserve Bank of India in this regard."

UNDER that scheme, it was further provided that the Authority which had sanctioned the loan, had the power to determine the ''deserving cases'' for interest relief and the Branch where the accounts are being operated shall provide the relief in the ''deserving cases'' thus determined. In this case the interest subsidy was initially sanctioned, but lateron when the balance sheets were furnished it transpired from perusal thereof that the respondent was not eligible for such benefit as they did not fall within the definition of the term "deserving case", because right from the year 1989 upto 1992 when the scheme was introduced, it had been showing profits. The Head Office of the appellant as also RBI on an examination of facts and circumstances found the respondent to be not a "deserving case". The matter was taken up with the Banking Ombudsman who also came to the conclusion that the respondent was not entitled to the interest subsidy under the said scheme as it was not a ''deserving case''. The question that the appellant having recommended the respondent''s case and having sanctioned the necessary interest subsidy could not at a later date withdraw that benefit on a review without notice to the appellant. Counsel submitted that certain liabilities such as bank charges etc. had not been taken into the balance sheets. If that had been done the balance sheet would have reflected loss. It is interesting to note that long before the filing of the present complaint, the Bank had instituted a suit against the present respondent/complainant for recovery of Rs. 93,15,587.67 which was pending before the Debt Recovery Tribunal, Jaipur since 1994, while the complaint was filed under the Consumer Protection Act only in 1997 even though the complainant had taken all the pleas which are the basis of present complaint, in defence of that suit of the Bank. The said Tribunal is ceased of the case and the complainant who has already raised a plea in defence to show that he was eligible for the benefit of the scheme and that the balance sheets did not reflect the correct picture. It will be for that Tribunal to consider the effect of it.

ON an inquiry from the Bench, it was stated at the Bar that all the points which arose for consideration before the State Consumer Disputes Redressal Commission including those noticed above, had been raised in defence of such suit and were pending adjudication in that suit.

SUBSTANTIAL questions have been raised in defence to the complaint even by the UCO Bank which need to be considered in detail which we are afraid has not been done in this case. The reasons for rejection of the claim by the Bank and concluding that the complainant is not covered by the term "deserving case" as defined in the scheme have not been examined in detail as also the findings of Bank Ombudsman and its implications have not been dealt with in the impugned order. The State Commission failed to appreciate that it was the appellant who was to determine the question as to whether under the scheme complainant was "deserving case" and whether its approach was not perverse or contrary to law. We find that RBI which had no privity of contract with the complainant had framed the scheme only for the Banks to follow who had to determine the question whether the complainant was a "deserving case". Mere framing a scheme for Banks to follow, cannot by itself fasten any liability on the Reserve Bank of India. Therefore, the order of payment against RBI in the impugned order cannot be sustained in any case.

THE State Commission, in our opinion in the facts and circumstances of this case, should not have proceeded with this case, particularly, when the fact of pendency of the suit and all the grounds which are the basis of the complaint were pending adjudication in such suit, was brought to its notice. The very filing of this complaint when the suit had already progressed considerably before a competent Court wherein the complainant had already filed a defence taking all the pleas which are the basis of the present complaint, appears to be only a counter-blast and an abuse of the process of law.

IT is also not free from doubt as to whether this case would fall within the jurisdiction of the FORA provided under the Consumer Protection Act. Because, among other things, the fact as to whether the complainant would be entitled to the benefit of certain schemes prima facie would not by itself amount to hiring of any service for consideration as contemplated under the Consumer Protection Act. The complainant is seeking relief under a scheme formulated by RBI. Whether they are covered by the scheme or not is for the Authority concerned to decide, the question of hiring of services for consideration under the scheme does not arise. We refrain from stating anything further on the merits of the claim of the respondent/complainant, to avoid any prejudice being caused to his defence in the suit before the Debts Recovery Tribunal, wherein the complainants pleas are also pending adjudication. That Tribunal will consider on merits the pleas raised by the respondent in his written statement. For the reasons mentioned above, we consider that the impugned order cannot be sustained and is hereby set aside. We may also observe that it is in the interest of judicial propriety that where a civil action is already pending adjudication involving the same questions of facts and law, Special Tribunal should not normally, in the absence of special circumstances, entertain such actions for by doing so the possibility of it becoming a tool in the hands of complainant to overreach the Civil Court and thereby abuse the process of law cannot be ruled out. The appeal is accepted and is disposed of as above with costs quantified at Rs. 5,000/-.