Delhi District Court
Office At Mangalore (South Kanara vs Suresh Sharma on 3 May, 2017
IN THE COURT OF SHRI ANKIT SINGLA: CIVIL JUDGE : 03 CENTRAL
TIS HAZARI COURTS : DELHI
Suit No. 137/2013 (97139/2016)
Corporation Bank
LIC Card Centre, New Delhi, A body corporate constituted under
the Banking Companies (Acquisition and Transfer of
Undertakings) Act, 1980 (Act No.3 of 1980) having its Head
Office at Mangalore (South Kanara, Karnataka State) and having
a branch at Corporation Bank,
LIC Card Centre,
16/10, FF, Main Arya Samaj Road,
Karol Bagh, New Delhi110005. .......Plaintiff
Versus
Suresh Sharma
S/o Shobha Ram Sharma
R/o B220, Kapra Colony,
NIT Faridabad,
Haryana121001 ........ Defendant
SUIT UNDER ORDER XXXVII OF THE CODE OF CIVIL PROCEDURE
FOR RECOVERY OF Rs.26,132.17 ALONG WITH PENDENTELITE
AND FUTURE INTEREST @ 2.5% PER MONTH.
Date of institution : 01.07.2017
Date of reserving for orders : 03.05.2017
Date of decision : 03.05.2017
E X P A R T E J U D G M E N T
1.Vide this judgment, I shall dispose of the present suit filed by Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 1 of 9 the plaintiff seeking recovery of Rs.26,132.17/ along with pendentelite and future interest @ 2.5% per month. It is pertinent to note that originally the suit was filed under Order 37 of CPC, however, on 26.02.2014, this court converted the present suit into ordinary suit for recovery on the premises that the plaintiff has claimed interest and other charges from defendant even after account of the defendant was declared as NPA which is a triable issue.
2. Briefly stated the facts as averred by the plaintiff in the plaint which are necessary for the disposal of the present suit are as follows:
(a) The plaintiff bank is nationalized bank and is a body corporate constituted under the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1980 (Act No. 3 of 1980) having its head office at Manglore (South Kanara, Karnataka State) and having a branch at Corporation Bank, LIC Card Centre, 16/10, FF, Main Arya Samaj Road, Karol Bagh, New Delhi.
(b) It is averred that Sh. A.V. Ambastha, Chief Manager is the constituted attorney and is a principal officer of the plaintiff/bank, has been duly authorized and empowered to institute the present suit and sign, verify and affirm all the pleadings, affidavits and vakalatnma on behalf of plaintiff bank. It is further averred that the LIC card is issued by LIC Cards Services Limited in association with the Corporation Bank and the LIC Card account is maintained by Corporation Bank, whereas LIC card is distributed and marketed by the LIC Cards Services Limited.
(c) The defendant approached the plaintiff bank for issuing a LIC Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 2 of 9 Credit Card and submitted dully filled and signed application along with copies of Voter ID Card, PAN Card, NDPL Electricity Bill for the proof of his photo identity and residence of the defendant. After due consideration of the request of defendant, the plaintiff bank issued a LIC Credit Card No.4628460001478007 to defendant with a limit of Rs.25,000/.
(d) It is averred that defendant availed and used the LIC Credit Card from time to time in purchasing various goods from the market, paying various bills, buying various services and making cash payments etc. It is further averred that whole transactions of buying and purchasing by the defendant is a part and parcel of tripartite agreement entered into by the plaintiff with the VISA and merchant Establishments.
(e) It is further averred that as per the terms and conditions of the LIC Credit Card user guide, defendant is liable to make the payments of all the outstanding of the said credit card and other charges as applicable for the retentions and utilizing the said credit card. It is further averred that defendant has been regularly billed by means of periodical monthly statement (s) issued by the plaintiff by way of couriers, email and SMS etc. in relation to the said credit card. It is further averred that the plaintiff has repeatedly called upon the defendant to clear and liquidate the dues in respect to the said credit card, however, all the demands proved futile and the account of the defendant became highly irregular from almost the very beginning.
(f) It is averred that the defendant failed to maintain financial discipline and to deposit regular minimum amount in the Card account, and as a result, the Card account became overdrawn. In the above facts and Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 3 of 9 circumstances, the plaintiff bank was left with no alternative, but to issue a recall notice and accordingly, the plaintiff issued a recall notice dated 14.02.2013 through registered post on 05.03.2013 calling upon the defendant to pay sum of Rs. 21,225.46/ It is averred that no response was received by the plaintiff to the recall notice dated 14.02.2013 nor the defendant regularized the LIC Credit Card account.
(g) On the basis of the aforesaid facts, it is prayed that a decree for the recovery of Rs.26,132.17 along with pendentelite and future interest @ 2.5% per month be passed in favour of plaintiff against the defendant.
3. Summons for settlement of issues was served but, defendant did not appear in the court, therefore, vide order dated 15.09.2014, his defence was struck off and he was proceeded exparte.
4. In support of his case, plaintiff examined Sh. Ashwin Tirkey as PW1 and he relied upon following documents: Exhibits/ Marks Description of documents Ex. PW1/1 (OSR) Power of attorney of Sh. Ashwin Tirkey. Ex. PW1/2 (OSR) Copy of agreement dated 30.03.2009. Ex. PW1/3 (colly) Original credit card form and the supporting documents.
Ex. PW1/4 (OSR) The most important terms and conditions. Ex. PW1/5 The screen Shot providing the details regarding the defendant and the credit card allotted to him.
Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 4 of 9 Ex. PW1/6 (colly) Copy of legal notice with registered post receipts. Ex. PW1/7 (colly) Certificate of 65B of Indian Evidence Act, 1872 i.e. which is the part of statement of account.
Ex. PW1/8 (OSR) Agreement executed between the Corporation Bank and Opus Software Solution Pvt. Ltd.
Ex.PW1/9 Plaint along with supporting documents.
Mark A Power of Attorney of the previous AR Sh. A.V.
Ambastha.
Mark B The copy of white lable/cobranded credit card feature.
5. Arguments were addressed by the counsel for the plaintiff. Record perused.
6. In order to decide whether plaintiff is entitled to claim any amount from the defendant or not, the court has to decide first whether there is privity of contract or not between the parties or not. The perusal of documents filed by the plaintiff on record does not show that defendant entered into any contract with the plaintiff. The perusal of pleadings and documents relied upon by the plaintiff shows that one company namely LIC Credit Card Limited (LICCSL) received an application for issuance of credit card and submitted the same on behalf its customer with designated branch of the plaintiff bank situated at Delhi. The documents on record shows that LICCSL entered into an agreement with the plaintiff bank for distribution and marketing of the said credit card. The perusal of record further shows that the plaintiff bank accepted the said application of defendant for issuance of credit card and accordingly, issued the same.
Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 5 of 9
7. The perusal of documents shows that the defendant had transacted/contracted with the LICCSL through the sales representative of LICCSL as it is evident from the declaration of sales representative of LICCSL made in the application form. There is no averment in the plaint that the LICCSL had acted as an agent of plaintiff while entering into contract with the defendant. On the contrary, the plaintiff has claimed that the company LICCSL was an agent of the defendant. However, it is an admitted fact on record that an agreement was executed between the plaintiff bank and LICCSL only. The defendant had neither authorized the said LICCSL to enter into the impugned agreement with the plaintiff bank nor defendant has later on appointed LICCSL as its agent in any form. Evidently, the contract is a bipartite between the defendant and LICCSL. The plaintiff bank is not a party to the said contract though it has maintained the account of the defendant. In this regard, merely maintaining the account of defendant or determining the credit limit of the credit card does not entitle the plaintiff to sue the defendant for the amount accrued towards usage of the credit card. Simply, stating, there is no privity of contract between the plaintiff and the defendant and undoubtedly, the plaintiff is a stranger to the contract entered into between the LIC Card Services Ltd. and defendant.
8. As noted above, the plaintiff is a stranger to the contract entered into by the LIC Card Services Ltd. and defendant, hence, the court has no hesitation in holding that the plaintiff has no right to sue to the defendant on the basis of any contract.
Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 6 of 9
9. After deciding that there is absence of privity of contract between the plaintiff and the defendant, the question which arise for the consideration is, can plaintiff still claim recovery of any amount from defendant or not. In my considered opinion, the plaintiff can still seeks recovery of amount from defendant on the basis of principle of unjust enrichment as is enunciated in section 68 to 72 of Indian Contract Act. The principle simply states that a person who has been unjustly enriched at the expense of another is required to make the restitution to the other. This proceeds on the basis of that it would be unjust to allow one person to retain a benefit received at the expense of another person. Nemo debet locupletari ex aliena juctura i. e. no man should grow rich out of another person's loss. Reliance is placed upon judgment titled as "Mahabir Kishore Vs. State of Madhya Pradesh, AIR 1990 SC 313, wherein it is held that the principle of unjust enrichment has been stated to presuppose three things: A. that the defendant has been enriched by the receipt of benefit;
B. he must have been so enriched at the plaintiff's expense and C. it would be unjust to allow to him to keep the benefit.
10. From the above, it is apparent that a claim for compensation made by one person against another under provision of from Section 68 to 72 of Indian Contract Act are not on the basis of any subsisting contract between the parties but, it is based on principle that something had been done by one party for the other without intending to do so gratuitously which other party has voluntarily received.
Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 7 of 9
11. Thus, in view of above, even if there was no privity of contract between the plaintiff and the defendant and as the defendant has enjoyed the benefit of money delivered by the plaintiff not intending to give so gratuitously, the defendant is liable to compensate to plaintiff for the same. Accordingly, this court is of the view that plaintiff can still claim from the defendant the money which it paid to the establishments where defendant used the credit card issued by plaintiff.
12. As per Ex. PW1/6, the account of defendant was declared as NPA on 02.09.2010. However, the perusal of statements of account filed by the plaintiff does not show what was the amount due as on 02.09.2010. The statement of account dated 21.08.2010 shows that amount of Rs.905/ was due from the defendant. Thus, after including the interest for period of 12 days, as on 02.09.2010, the amount of Rs.995/ was outstanding from the defendant. Thus, the plaintiff is entitled for this amount from the defendant. Accordingly, the plaintiff's suit is decreed for this amount.
13. The perusal of statements of account subsequent to declaration of account of defendant as NPA reveals that plaintiff has levied service tax and interest @ 30% per year on the defendant on the outstanding amount. In my considered opinion, plaintiff can not claim any service tax from the defendant after the account of the defendant was declared as NPA for simple reason that no credit card facility was provided by the plaintiff to the defendant after the declaration of account of defendant as NPA.
Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 8 of 9
14. Similarly, in my considered opinion, in absence of any valid agreement between plaintiff and defendant, plaintiff can not claim interest @ 30% per year from the defendant after the account was declared as NPA. The interest @ 30% is highly excessive and exorbitant in nature. Considering the facts and circumstances of the case and nature of the credit given to the defendants, this court is of the view that interest @ 6% is sufficient to meet the end of justice. Accordingly, the plaintiff is granted interest @ 6% from 02.09.2010 till realization on the decreed amount i.e. Rs.995/.
RELIEF
15. In view of aforesaid observation, the suit of the plaintiff is partly decreed for an amount of Rs.995/ @ 6% from 02.09.2010 till realization.
Decree sheet be prepared accordingly. Cost of the suit to be borne by the defendant.
File be consigned to record room after necessary compliance.
Announced in the open court today i.e. on 03.05.2017.
(ANKIT SINGLA) CIVIL JUDGE03C/THC DELHI/03.05.2017 Suit no. 137/2013 (97139/2016) Corporation Bank Vs. Suresh Sharma 9 of 9