National Consumer Disputes Redressal
M/S Ashiana Inn Limited & Anr. vs Punjab & Sind Bank, Ifb Bank Square on 5 July, 2013
NATIONAL CONSUMER DISPUTES REDRESSAL COMMISSION NEW DELHI CONSUMER COMPLAINT NO. 99 OF 2013 WITH INTERIM APPLICATION NO. 2693 OF 2013 1. M/s Ashiana Inn Limited ........ Complainants A body corporate, having its Registered Office at Village Dhakoli, Tehsil Dearabassi, District, Mohali through its Managing Director Shri Avtar Singh 2. Shri Avtar Singh s/o Shri Sarwan Singh r/o 1843, Sector 21, Panchkula, Haryana Vs. Punjab & Sind Bank, IFB, Bank ......... Opposite Party Square, Sector 17-B, Chandigarh Through its Branch Manager BEFORE: HON'BLE MR. JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER HONBLE MR.SURESH CHANDRA, MEMBER For the Complainants : Mr. Madhurendra Kumar, Advocate Alongwith Mr.I.S.Ratta, Advocate PRONOUNCED ON : 05th JULY, 2013 ORDER
PER JUSTICE AJIT BHARIHOKE, PRESIDING MEMBER M/s Ashiana Inn Ltd. through its Managing Director Shri Avtar Singh has preferred this complaint under section 21 r/w section 12 of the Consumer Protection Act, 1986 ( in short, the Act) against M/s Punjab & Sind Bank, IFB Bank Square, Sector 17-B, Chandigarh claiming deficiency on the part of the opposite party in relation to the release and sanction of the bank loan for the upcoming hotel project of the complainant with the following prayer:
i. To direct the bank to immediately release Rs. 25.00 crores.
ii. to direct the bank to convert the overdue amount into FITL.
iii. the opposite party to pay damages on account of mental agony etc. Rs.90.00 crores iv. the opposite party to pay costs of the complaint of Rs.2.00 lac.
v. any other, additional or alternative relief as deemed fit and proper in the fact and circumstances of the case.
2. The break-up of the damages of the Rs.90.00 crores claimed by the complainant given in para 50 of the complaint reads thus:
(Amount in Rs.) Extra Interest liability on Bank borrowings for a period of last three years 15.00 crores Extra interest liability on borrowings from other sources for a period of three years 10.00 crores Loss of income from the Hotel for the period of last three years i.e. Rs.10.00 crores each year 30.00 crores Loss of reputation 30.00 crores Mental torture and physical discomfort 15.00 crores Total Rs. 90.00 crores
3. Shri Madhurendra Kumar, learned counsel for the complainant in his written and oral submissions has contended that the respondent bank is engaged in the business of providing service to the general public for consideration. As such, it being the service provider, the bank is amenable to the jurisdiction of the consumer fora. In support of this contention, learned counsel has drawn our attention to the definition of service as provided in section 2 (1) (O) of the Act. Learned counsel for the complainant has taken us through the definition of consumer as defined under section 2 (1) (d) of the Act and contended that since the complainant has hired the banking services of the opposite party, he squarely falls within the definition of consumer.
He contended that amendment of definition of consumer which excludes the person who avails service for commercial purpose is not applicable in this case for the reason that although the loan transaction between the complainant and opposite party is a commercial transaction but the services availed are not for commercial purpose. Learned counsel contended that the building of the proposed hotel project is not yet complete or functional, therefore, at this stage, it cannot be said that the building in question would be used for commercial purpose because the user of the building is dependent upon various permissions and licences from the authorities. In support of his contention, learned counsel for the complainant has relied upon several judgments of the Apex Court and the National Commission particularly in the cases of Karnataka Power Transmission Vs. Ashok Iron Works Pvt. Ltd. AIR 2009 SC 1905 being Civil Appeal No. 1879 of 2003, Regional Provident Fund Commissioner Vs. Shiv Kumar Joshi (2000) 1 SCC 98, Chandigarh Housing Board Vs. Avtar Singh & Ors.
AIR 2011 SC 130, Lucknow Development Authority Vs. M.K.Gupta (1994) 1 SCC 243, Harsolia Motors Vs. National Insurance Co. Ltd. 1 (2005) CPJ 27 (NC) and also the decision of this Commission dated 18.08.2011 in the matter of HUDA Vs. M/s Suneja & Sons in RP No. 2951 of 2009.
4. We have considered the submissions made by learned counsel for the complainants and perused the record. The answer to the issue of maintainability of the instant complaint would depend upon the fact whether or not the complainants are covered within the definition of complainants given in section 2 (1) (b) of the Act which is reproduced thus:
complainant means-
(i) a consumer; or
(ii) any voluntary consumer association registered under the Companies Act, 1956 ( 1 of 1956) or under any other law for the time being in force; or
(iii) the Central Government or any State Government ; or
(iv) one or more consumers, where there are numerous consumers having the same interest;
(v) in case of death of a consumer, his legal heir or representative; who or which makes a complaint.
5. The complainants claim that they are covered under clause (i) of Section 2 (b) of the Act. Thus it is to be seen whether or not the complainants fall within the definition of consumer. The term consumer is defined under section 2 (1) (d) of the Act.
Section 2 (1) (d) (i) deals with the definition of consumer in relation to the person who buys any good or consideration. Section 2 (1) (d) (ii) deals with the definition of consumer in relation to a person who hires or avails of services for consideration since this is a case relating to alleged deficiency in service. The definition of consumer as provided in section 2 (1) (d) (ii) is relevant which is reproduced thus:
consumer means any person who -
(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first-mentioned person but does not include a person who avails of such services for any commercial purpose;
Explanation.For the purposes of sub-clause (i), commercial purpose does not include use by a consumer of goods bought and used by him exclusively for the purpose of earning his livelihood, by means of self-employment.
6. Before dwelling upon the above noted definition of consumer, we may note that the definition of consumer was amended by Act 62 of 2002, Section 2 w.e.f.
15.03.2003. By this amendment, the legislature in its own wisdom restricted the scope of the definition of consumer by adding the words but does not include a person who avails of such services for any commercial purpose. This implies that a person who avails of services for consideration for any commercial purpose shall not be covered under the definition of consumer and as such, such persons would not be entitled to maintain a complaint under the Act in view of Section 2 (1) (b) of the Act.
We are conscious of the fact that explanation to section 2 (1) (d) of the Act provides that for the purpose of section 2 (1) (d), commercial purpose does not include the services availed by the person exclusively for the purpose of earning his livelihood by means of self-employment. Above-noted explanation restricting the scope of commercial purpose is of no avail to the complainant because complainant no.1 is a body corporate and not a natural person who needs to indulge in some activity to earn his livelihood.
7. In the light of the above analysis of the relevant provisions of the Act, we now proceed to analyse the complaint to find out whether or not the complainants fall within the definition of consumer reproduced above. On perusal of the complaint, it is evident that loan facility was availed of by the complainants to finance their commercial project to construct and run a three star hotel Marc Royale. Therefore, it is obvious that the so called services which are claimed to be deficient were availed by the complainant for commercial purpose i.e. running a hotel for earning profits.
8. Learned counsel for the complainant has made a valiant effort to make a distinction between the commercial transaction and commercial purpose referred to in the definition of consumer. He has contended that although the nature of loan transaction between the complainants and the opposite party is commercial but the loan sanctioned by the opposite party cannot be termed as loan for any commercial purpose. We do not find any merit in this contention in view of the allegations made in the complaint. Otherwise also, perusal of para 50 of the complaint would show that the complainants have sought compensation of Rs.30.00 crores for loss of income for three years because of deficiency in service by the opposite party and also Rs. 30.00 crores for loss of reputation. From the fact that the claimants are seeking compensation for loss of income for a period of three years because of non completion of project as a consequence of deficiency in service of the opposite party, it is clear that the loan in question was taken for commercial purpose. That being the case, the only conclusion which can be derived on reading of the complaint is that the complainants had availed the services of the opposite party bank for a commercial purpose i.e. construction of hotel for earning profit. Thus, in our view, the complainants are not covered under the definition of consumer as defined under section 2 (1) (d) (ii) of the Act. As such, the complaint is not maintainable before the consumer fora.
9. Judgments of the Supreme Court in the matters of Karnataka Power Transmission Vs. Ashok Iron Works Pvt. Ltd. (supra), Regional Provident Fund Commissioner Vs. Shiv Kumar Joshi (supra), Lucknow Development Authority Vs. M.K.Gupta (supra) are of no avail to the complainant because aforesaid judgments relate to the cases pertaining to the period prior to the amendment of definition of consumer which included the persons availing or hiring services for commercial purpose also.
Even the other judgments relied upon by the complainants are of no avail to them for the reason that those judgments have been given in different context based upon the peculiar facts of said case. In the instant case, as discussed above, it is evident from the allegations in the complaint that the complainants have availed of the alleged services for purely commercial purpose. As such, complainants are not covered under the amended definition of consumer.
10. The result of above discussion is that the complainants herein are not covered under the definition of consumer as defined under section 2 (1) (d) (ii) of the Act. As such they are not entitled to maintain a consumer complaint in view of section 2 (1) (b) of the Act. Complaint is, therefore, rejected as not maintainable.
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(AJIT BHARIHOKE, J) ( PRESIDING MEMBER) Sd/-
(SURESH CHANDRA) MEMBER Am/