State Consumer Disputes Redressal Commission
Vijay Sukhija, Member vs Swami Geeta Giri @ Indu Arora on 20 October, 2009
STATE CONSUMER DISPUTES REDRESSAL COMMISSION, PUNJAB,
S.C.O. NO. 3009-10, SECTOR 22-D, CHANDIGARH.
First Appeal No. 258 of 2009
Date of institution : 3.3.2009
Date of decision : 20.10.2009
Vijay Sukhija, Member, The Muktsar State Bank of India Employees' Coop.
Urban Salary Earners Thrift & Credit Ltd., Muktsar, now resident of Dhannu Mal
Street, Muktsar.
.......Appellant
Versus
1. Swami Geeta Giri @ Indu Arora daughter of Shri Gopi Ram, resident of
Satsang Bhawan, Channu Mal Street, Muktsar.
2. The Muktsar State Bank of India Employees' Coop. Urban Salary Earners
Thrift & Credit Society Ltd., Muktsar, through its President Shri Arun
Singla, Officer State Bank of India, Doda, Muktsar.
3. Arun Singla, President, The Muktsar State Bank of India Employees' Coop.
Urban Salary Earners Thrift & Credit Society Ltd., Muktsar, now posted at
State Bank of India, Doda, District Muktsar.
4. Sham Sunder Bedi, Vice President, The Muktsar State Bank of India
Employees' Coop. Urban Salary Earners Thrift & Credit Society Ltd.,
Muktsar, now resident of behind Old Samundri Petrol Pump, Muktsar.
5. Krishan Kumar Gawri, Asstt. State Bank of India, Main Branch Muktsar,
Secretary-cum-Cashier, The Muktsar State Bank of India Employees'
Coop. Urban Salary Earners Thrift & Credit Society Ltd., Muktsar, now
resident of Chhannu Mal Street, Muktsar.
6. Karnail Singh son of Shri Guljar Singh, Senior Assistant, State Bank of
India, Treasury Branch, Sector 17, Chandigarh, Member, The Muktsar
State Bank of India Employees' Coop. Urban Salary Earners Thrift &
Credit Society Ltd., Muktsar.
First Appeal No.258 of 2009. 2
7. Akshoni Kumar, Assistant, State Bank of India, ADB Muktsar, Member,
The Muktsar State Bank of India Employees' Coop. Urban Salary Earners
Thrift & Credit Society Ltd., Muktsar.
8. Chief General Manager, State Bank of India, Local Head Office, Sector 17,
Chandigarh.
9. Branch Manager, State Bank of India, Main Branch, Muktsar.
......Respondents
First Appeal against the order dated 23.1.2009 of
the District Consumer Disputes Redressal Forum,
Muktsar.
Before :-
Hon'ble Mr. Justice S.N. Aggarwal President.
Lt. Col. Darshan Singh (Retd.), Member.
Shri Piare Lal Garg, Member.
Present :-
For the appellant : Shri Ashwani Talwar, Advocate.
For respondent No.1 : Shri S.C. Arora, Advocate.
For respondent No. 2 to 4 & 7 : Shri R.K. Girdhar, Advocate.
For respondent No.5 : Ex parte.
For respondent No.6 : Shri R.L. Gupta, Advocate.
For respondent No.8 & 9 : Shri Kapil Kakkar, Advocate.
JUSTICE S.N. AGGARWAL, PRESIDENT:
This order will dispose of three appeals, namely, First Appeal No.258 of 2009 (Vijay Sukhija v. Swami Geeta Giri @ Indu Arora and others), First Appeal No.271 of 2009 (Arun Singla and others v. Swami Geeta Giri and others) and First Appeal No.283 of 2009 (Karnail Singh v. Swami Geeta Giri @ Indu Arora and others) as all these appeals are directed against the same impugned order dated 23.1.2009 passed by the learned District Consumer Disputes Redressal Forum, Muktsar (in short "District Forum"). The questions of law and facts involved in all these appeals are also identical. The facts are being taken from First Appeal No.258 of 2009 and the parties would be referred by their status in this appeal.
2. The Muktsar State Bank of India Employees' Coop. Urban Salary Earners Thrift & Credit Society Ltd., Muktsar respondent No.2 (in short " the respondent First Appeal No.258 of 2009. 3 Society") was constituted with a purpose of welfare of the employees of the Bank. It used to provide loans to the employees and others by collection of deposits from general public. The respondent society was duly registered with the Registrar, Cooperative Societies, Punjab under the provisions of Cooperative Societies Act. The appellant was its Member. Arun Singla respondent No.3 (appellant No.1 in First Appeal No.271 of 2009) was its President. Sham Sunder Bedi respondent No.4 (appellant No.2 in First Appeal No.271 of 2009) was its Vice President. Krishan Kumar Gawri respondent No.5 (appellant in First Appeal No.330 of 2009 "Krishan Kumar Gawri v. Swami Geeta Giri @ Indu Arora and others" dismissed for want of prosecution on 21.8.2009) was its Secretary-cum-Cashier. Karnail Singh respondent No.6 (appellant in First Appeal No.283 of 2009) was its Member. Akshoni Kumar respondent No.7 (appellant No.3 in First Appeal No.271 of 2009) was its Member. Respondent No.8 was the Chief General Manager of State Bank of India whose employees had started the respondent society and respondent No.9 was the Manager of Muktsar Branch of State Bank of India.
3. It was further pleaded that Swami Geeta Giri respondent No.1 was a lady of religious nature. Her original name was Indu Arora. She was inducted into service of religion by her Guru by spiritual conversion and she was serving Satsang Bhawan, Chhannu Mal Street, Muktsar. She was having savings bank account with the State Bank of India, Muktsar Branch (respondent No.9).
4. It was further pleaded that on 1.1.2003 respondent No.1 visited the bank respondent No.9 for depositing certain amounts in fixed deposits. She was welcomed by respondent No.9. She deposited an amount of Rs.1,00,000/- and she was issued FDR No.2440 with the stipulation of interest at the rate of 12% per annum. The date of maturity was 1.1.2004. From appearance this FDR did not appear to be the regular FDR. Respondent No.1 raised her doubts about the sanctity of this document but the Branch Manager told her that this amount had First Appeal No.258 of 2009. 4 been deposited in the account of the Society of the Bank (the respondent Society) and it pays more interest than the interest paid by the bank.
5. It was further pleaded that on this, respondent No.1 asked the Manager of respondent No.9 if the higher authority allows such society working in the premises of the Bank itself and against the interest of the Bank. The Manager replied that the Society had been duly approved by the Central Office of the Bank and it was working with the permission of the Bank. Moreover the repayment was also assured by the Bank. Respondent No.1 believed this representation made by the Manager respondent No.9 and no reason was left in her mind to disbelieve whatever was told to her. Respondent No.1 did not need the money. Accordingly the FDR was got renewed upto 1.1.2005 and further renewed upto 1.1.2006 and upto 1.1.2007.
6. It was further pleaded that on 4.8.2004 respondent No.1 again visited the Bank Branch of respondent No.9 for depositing Rs.2,00,000/- with the Bank. The deposit was accepted in the joint name of respondent No.1 with her mother Smt. Lajwanti and T.D. receipt No.2703 dated 4.8.2004 was issued to her. This FDR was again issued by the respondent Society in place of the Bank. This was to be materialized on 4.8.2005. This FDR was renewed from 4.8.2005 to 4.8.2006 and the interest rate was again 12% per annum.
7. It was further pleaded that on the same day i.e. 4.8.2004 respondent No.1 again deposited a sum of Rs.2,00,000/- in her name alone and this amount was deposited by the employees of the Bank in the account of the respondent Society. Fixed Deposit (TDR No.2705 dated 4.8.2004) was issued to her. The interest rate was also mentioned as 12% per annum. It was also got renewed from 4.8.2005 to 4.8.2006.
8. It was further pleaded that on 1.3.2005 again respondent No.1 went to the Main Branch of respondent No.9 to deposit a sum of Rs.2,00,000/-. It was deposited by respondent No.1 jointly in her name and in the name of her mother Lajwanti against TDR No.2774 dated 1.3.2005. The amount was deposited with First Appeal No.258 of 2009. 5 the respondent Society instead of with the Bank by the employees of respondent No.9. The date of maturity was 1.3.2006. It was got renewed from 1.3.2006 to 1.3.2007. The rate of interest was again 12% per annum.
9. Respondent No.1 again visited the Main Branch of respondent No.9 for depositing a sum of Rs.1,00,000/- on 1.4.2005 jointly in her name and in the name of her associate Neeru Bala. This amount was deposited against TDR No.2773 dated 1.4.2005 in the account of the respondent Society and not in the name of the Bank with interest at the rate of 12% per annum. The date of maturity was 1.4.2006. It was again renewed for the period from 1.4.2006 to 1.4.2007.
10. It was further pleaded that on 1.4.2005 respondent No.1 again deposited a sum of Rs.2,00,000/- in her religious name Swami Geeta Giri against TDR No.2775 dated 1.4.2005 with interest at the rate of 12% per annum. The date of maturity was 1.4.2006. It was got renewed for the period from 1.4.2006 to 1.4.2007. The TDR was issued by the respondent Society and not by the Bank.
11. It was further pleaded that respondent No.1 in all had deposited a sum of Rs.10,00,000/- with the respondent Society. Out of this amount, Rs.4,00,000/- had fallen due on 4.8.2006, Rs.1,00,000/- on 1.1.2007, Rs.2,00,000/- on 1.3.2007 and Rs.3,00,000/- on 1.4.2007. Respondent No.1 entered into an agreement with some persons at Pathankot to purchase a piece of land in Pathankot for the construction of Ashram. She approached the respondents to collect the amount entrusted to them so that she would get the sale deed executed. However, she was told by the respondents that the Secretary-Cum-Cashier of the respondent Society had misappropriated the funds and she was told to wait for a while. The respondents, however, failed to make the payment. Alleging deficiency in service on the part of the appellant and respondents No.2 to 9, respondent No.1 filed the complaint against them in the learned District Forum for releasing the amounts of the FDRs/TDRs with the agreed rate of interest. Compensation, interest and costs were also prayed.
First Appeal No.258 of 2009. 6
12. Respondent No.3 (appellant no.1 in First Appeal No.271 of 2009) filed the written reply. It was admitted that the respondent Society was duly registered with the Registrar, Cooperative Societies, Punjab under the Cooperative Societies Act. However the respondent Society was non-functional. The record of the respondent Society was under the custody of respondent No.5 in his capacity as Secretary-Cum-Cashier. No meeting of the Executive Committee was convened by the said Secretary-cum-Cashier which was a part of his duty.
13. It was also pleaded that respondent No.3 was transferred from State Bank of India, Muktsar since 2002 and he was out of touch with the respondent Society since then. Therefore he cannot be held responsible for the misuse of official record and FDRs/TDRs prepared by respondent No.5. The account of the respondent Society was being audited by the Audit Department of the Cooperative Societies. Respondent No.5 was an unreliable person. He was placed under suspension in a fraud case by his employer State Bank of India and his whereabouts were not known. If any fraud was committed by respondent No.5 with respondent No.1 it was done by him in his personal capacity as Secretary- Cum-Cashier by misusing the blank forms of FDRs entrusted to him by the respondent Society in his capacity as Secretary-cum-Cashier. Therefore neither the respondent Society is liable for the act and conduct of respondent No.5 nor the other respondents. It was also pleaded that the connivance of respondent No.1 with respondent No.5 could not be ruled out.
14. It was further pleaded that respondent No.3 cannot be held liable for the fraud committed by respondent No.5 with ill intention on behalf of respondent Society. It was also pleaded that the record of the respondent Society was lying with respondent No.5. The jurisdiction of the District Forum was disputed. It was denied if respondent No.1 was a consumer. It was also pleaded that complicated questions of facts and law are involved in this complaint and, therefore, the matter was referable to the civil court. The complaint was bad for non-joinder and misjoinder of parties. It was obligatory for respondent No.5 to file arbitration First Appeal No.258 of 2009. 7 under the provisions of the Punjab Cooperative Societies Act. Hence dismissal of the complaint was prayed.
15. Sham Sunder Bedi respondent No.4 (appellant No.2 in First Appeal No.271 of 2009) also filed the written reply. Almost similar pleadings were made by him as have been made by respondent No.3. Dismissal of the complaint was prayed.
16. Krishan Kumar Gawri respondent No.5 also filed the written reply. It was admitted that respondent No.1 was a resident of Muktsar. It was also admitted that the respondent Society was constituted with the purpose and objective as pleaded in the complaint. It was pleaded that Arun Singla respondent No.3 was duly authorized to carry on the business of the respondent Society. The answering respondent including other respondents were not responsible for the business of the respondent Society. They are not liable for any amount and no liability can be fastened on the answering respondent. The alleged receipts set up by respondent No.1 were not signed by him. All other facts were denied and dismissal of the complaint was prayed.
17. Karnail Singh respondent No.6 (appellant in First Appeal No.283 of 2009) also filed the written reply. It was pleaded that he was transferred in November 2002 to Chandigarh and earlier to that he was transferred from Main Bazar, Muktsar to ADB, Muktsar in March 1999. Thereafter he has no concern whatsoever with the business of the respondent Society. It was admitted by him that respondent No.1 was resident of Muktsar. The respondent Society was constituted with the purpose and object as pleaded in the complaint. The receipts produced by respondent No.1 were not signed by the answering respondent. These were signed by Krishan Kumar Gawri respondent No.5. Therefore respondent No.5 was liable. All other allegations were denied. The legal objections were also pleaded and the dismissal of the complaint was prayed.
18. Akshoni Kumar respondent No.7 (appellant No.3 in First Appeal No.271 of 2009) also filed written reply. It was pleaded that the respondent Society was non- functional since 2002 and, therefore, the deposits were not received by the First Appeal No.258 of 2009. 8 respondent Society after that year. It was admitted that the respondent Society was duly registered with the Registrar, Cooperative Societies, Punjab. As per the bye laws of the respondent Society the record of the respondent Society was being kept by the Secretary-Cum-Cashier i.e. respondent No.5. All the duties were duly defined in the bye laws of the respondent Society. It was the duty of the Secretary to convene the meeting of the respondent Society but after the year 2002 no meeting was convened by him nor he produced any record. The account of the respondent Society was audited by the Audit Department of the Registrar, Cooperative Societies, Punjab and respondent No.5 who was an employee of the State Bank of India, Muktsar was suspended by his employer and his whereabouts were not known. If any misappropriation of funds of respondent No.1 had been done it has been done by respondent No.5 alone. For that purpose neither the respondent Society nor any other Member of the Society can be held liable for it. It was also pleaded that respondent No.1 and respondent No.5 were trying to cheat the other respondents/appellant by preparing fictitious FDRs/TDRs.
19. The appellant also filed the written reply. The pleadings made by him were almost identical. It was admitted that respondents No.2 to 7 were the authorized signatories of the respondent Society but the receipts produced by respondent No.1 were not signed by the appellant. These were only signed by respondent No.5 Krishan Kumar Gawri. Hence it was denied if there was any deficiency in service on the part of the appellant. Dismissal of the complaint was prayed.
20. Respondents No.8 and 9 also filed the written reply. It was denied if the alleged Society was running any business from the premises of the answering respondents. It was also denied if the respondent Society was constituted with a purpose for the welfare of the employees of the Bank. It was also denied if the employees of the answering respondents had obtained loan from the respondent Society with the consent of answering respondents. It was, however, admitted that the respondent Society was duly registered with the Registrar, Cooperative First Appeal No.258 of 2009. 9 Societies, Punjab under the provisions of the Punjab Cooperative Societies Act. It was denied if the answering respondent had any concern with the respondent Society. It was pleaded that the departmental enquiry could be conducted against the erring employees and they would be punished according to the law if they were found guilty. It was pleaded that no employee of the answering respondents was allowed to do personal work during the working hours.
21. It was denied if respondent No.1 had approached the Branch Manager on 1.1.2003 or if the Branch Manager had issued FDR No.2440 to respondent No.1 or if he had told her that the amount deposited by respondent No.1 was deposited in the account of the Society of the Bank or the respondent Society pays more interest than the interest paid by the Bank. It was also denied if the Branch Manager of the Bank had given any assurance to respondent No.1 about the respondent Society being approved by the higher authorities or that the respondent Society could work in the premises of the respondent Bank. It was also denied if any such assurance of repayment was given by the respondent Bank. It was pleaded that respondent No.1 has made out a false cock and bull story with fraudulent intention to grab the money from the respondent Bank. FDRs set up by respondent No.1 were not issued or renewed by the respondent Bank. Preliminary objections were pleaded and the dismissal of the complaint was prayed.
22. Respondent No.1 filed the affidavit of Krishan Rani as Ex.C1. She also filed the affidavit of Deepali Dabra as Ex.C2, affidavit of Mohit as Ex.C3, affidavit of Amandeep as Ex.C4. Respondent No.1 also filed her own affidavit as Ex.C5. She proved documents Ex.C6 to Ex.C20.
23. On the other hand, Arun Singla respondent No.3 (appellant No.1 in First Appeal No.271 0f 2009) filed his affidavit as Ex.OP2. Akshoni Kumar respondent No.7 (appellant No.3 in First Appeal No.271 of 2009) filed his affidavit as Ex.OP3. Sham Sunder Bedi respondent No.4 (appellant No.2 in First Appeal No.271 of 2009) filed his affidavit as Ex.RW3/A. Krishan Kumar Gawri respondent No.5 also filed his affidavit as Ex.OP4/A. Karnail Singh respondent First Appeal No.258 of 2009. 10 No.6 (appellant in First Appeal No.283 of 2009) filed his affidavit as Ex.OP5/A. He also proved documents Ex.OP5/B and Ex.OP5/C. Akshoni Kumar respondent No.7 (appellant No.3 in First Appeal No.271 of 2009) proved documents Ex.OP6/X and OP/X. Vijay Sukhija appellant filed his affidavit as Ex.OP7/A and document Ex.OP7/B. Respondents No.8 & 9 filed the affidavit of P.K. Goyal as Ex.OP8/1 and document Ex.OP8/2.
24. After considering the pleadings of the parties and the affidavits/documents placed on file by them, the learned District Forum accepted the complaint with costs of Rs.5,000/- vide impugned judgment dated 23.1.2009. Respondents No.2 to 7 were held liable jointly and severally to return the amount of the FDRs/TDRs with interest at the rate of 12% per annum from the date of deposit till the date of payment. Each of them (appellant and respondents No.3 to 7) was also directed to pay Rs.5,000/- as compensation to respondent No.1.
25. Hence the appellant filed the appeal with the prayer that the appeal be accepted and the impugned judgment dated 23.1.2009 be set aside.
26. Respondent No.3, 4 and 7 also filed First Appeal No.271 of 2009 with the same prayer that the appeal be accepted and the impugned judgment dated 23.1.2009 be set aside.
27. Karnail Singh respondent No.6 also filed appeal (First Appeal No.283 of 2009) with the prayer that the appeal be accepted and the impugned judgment be set aside.
28. Krishan Kumar Gawri respondent No.5 also filed appeal (First Appeal No.330 of 2009 "Krishan Kumar Gawri v. Geeta Giri @ Indu Arora and others") which was dismissed for want of prosecution on 21.8.2009.
29. Submissions have been considered. Record has been perused.
30. Swami Geeta Giri respondent No.1 has proved the receipt dated 1.3.2005 Ex.C6, which proves that she had deposited a sum of Rs.2,00,000/- in the respondent Society on 1.3.2005. The amount was accepted by the Secretary-cum- Cashier, namely, respondent No.5 and the said amount was repayable on 1.3.2006 First Appeal No.258 of 2009. 11 with interest at the rate of 12% per annum. Respondent No.1 has also proved receipts Ex.C7 to Ex.C11 which prove that respondent No.1 had deposited the following amounts in the respondent Society and the amounts were accepted by the Secretary-cum-Cashier respondent No.5 on behalf of the respondent Society:-
S.No. Amount deposited Date of FDR/TDR Date of
Deposit No. Maturity
1. Rs.1,00,000/- 1.1.2003 2440 1.1.2004
Renewed upto
1.1.2005,
1.1.2006 &
upto 1.1.2007
2. Rs.2,00,000/- 4.8.2004 2703 4.8.2005
Renewed upto
4.8.2006
3. Rs.2,00,000/- 4.8.2004 2705 4.8.2005
renewed upto
4.8.2006
4. Rs.2,00,000/- 1.3.2005 2774 1.3.2006
renewed upto
1.3.2007
5. Rs.1,00,000/- 1.4.2005 2773 1.4.2006
renewed upto
1.4.2007
6. Rs.2,00,000/- 1.4.2005 2775 1.4.2006
renewed upto
1.4.2007
Total: Rs.10,00,000/-
31. It is also not disputed that respondent No.3 is the President of the respondent Society, respondent No.4 is the Vice President, respondent No.5 is the Secretary-Cum-Cashier while respondents No.6 & 7 and the appellant are the Members of the respondent Society. Since the money was accepted on behalf of the respondent Society, therefore, all the office bearers of the respondent Society are equally liable along with the respondent Society.
32. The appellant and respondents No.3 to 7 have not been able to show if any other person was the office bearer of the respondent Society who has not been impleaded as respondent party.
33. In the present case, respondent No.1 had availed the services of the respondent Society of which the appellant and respondents No.3 to 7 were the office bearers. Therefore respondent No.1 was the consumer qua the respondent First Appeal No.258 of 2009. 12 Society and its office bearers i.e. the appellant and respondents No.3 to 7. The respondent Society had been accepting the money from respondent No.1 through its functionaries and the fixed deposit receipts were issued to her. Since the appellant and respondents No.3 to 7 failed to return the money and failed to render assured and promised services, therefore, the respondent Society and its office bearers were deficient in service.
34. The meaning of the words such as "consumer", "service", "deficiency in service" have been discussed by the Hon'ble Supreme Court in a number of judgments. Reference can be made to the judgment reported as "S.P. Goel v. Collector of Stamps, New Delhi" AIR 1996 (SC) 839. Moreover a number of cases have been decided by the Hon'ble National Commission where money was deposited by a person in the Kisan Vikas Patras or National Saving Certificate and the authorities failed to pay interest, it was held that it amounted to deficiency in service and the complaints under the Consumer Protection Act, 1986 were held as maintainable. Reference can be made to a recent judgment of the Hon'ble National Commission dated 01.09.2009 passed in Revision Petition No.2180 of 2004 "Senior Post Master v. Arvind Industries".
35. The first submission of the learned counsel for the appellant was that the respondent Society was a society registered under the Punjab Cooperative Societies Act vide registration No.205 dated 5.11.1985. Therefore the matter falls within the domain of Punjab Cooperative Societies Act and the rules framed thereunder. As such the matter is referable for arbitration. It was also submitted that when there is a special provision, general law would not be applicable. Reference was made to the judgment of Hon'ble Supreme Court reported as "GENERAL MANAGER, TELECOM v. M. KRISHANN & ANR." III(2009) CPJ 71 (SC) in which it was held by the Hon'ble Supreme Court that the special law overrides the general law.
36. This submission has been considered.
First Appeal No.258 of 2009. 13
37. The law on the subject has been settled by the Hon'ble Supreme in a number of judgments and it was held that the provisions of Section 3 of the Consumer Protection Act, 1986 (in short "the Act") specifically laid down that the remedy under the Act is an additional remedy. Section 3 of the Act reads as under:-
"3. Act not in derogaton of any other law.--The provisions of this Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force."
38. This provision was considered by the Hon'ble Supreme Court in the judgment reported as "Fair Air Engineers Pvt. Ltd. v. N.K. Modi" (1996)4 CTJ 749 (Supreme Court) (CP). It was observed by the Hon'ble Supreme Court as under:-
"15. Accordingly, it must be held that the provisions of the Act are to be construed widely to give effect to the object and purpose of the Act. It is seen that Section 3 envisages that the provisions of the Act in addition to and are not in derogation of any other law in force. It is true, as rightly contended by Shri Suri, that the words "in derogation of the provisions of any other law for the time being in force" would be given proper meaning and effect and if the complaint is not stayed and the parties are not relegated to the arbitration, the Act purports to operate in derogation of the provisions of the Arbitration Act. Prima facie, the contention appears to be plausible but on construction and conspectus of the provisions of the Act we think that the contention is not well-founded. The Parliament is aware of the provisions of the Arbitration Act and the First Appeal No.258 of 2009. 14 Contract Act and the consequential remedy available under Section 9 of the Code of Civil Procedure, i.e., to avail of right of civil action in a competent court of civil jurisdiction. Nonetheless, the Act provides the additional remedy.
16. It would, therefore, be clear that the Legislature intended to provide a remedy in addition to the consentient arbitration which could be enforced under the Arbitration Act or the civil action in a suit under the provisions of the Code of Civil Procedure. Thereby, as seen, Section 34 of the Act does not confer an automatic right nor create an automatic embargo on the exercise of the power by the judicial authority under the Act. It is a matter of discretion. Considered from this perspective, we hold that though the District Forum, State Commission and National Commission are judicial authorities, for the purpose of Section 34 of the Arbitration Act, in view of the object of the Act and by operation of Section 3 thereof, we are of the considered view that it would be appropriate that these Forums created under the Act are at liberty to proceed with the matters in accordance with the provisions of the Act rather than relegating the parties to an arbitration proceedings pursuant to a contract entered into between the parties. The reason is that the Act intends to relieve the consumers of the cumbersome arbitration proceedings or civil action unless the forums on their own and on the peculiar facts and circumstances of a particular case, come to the conclusion that the First Appeal No.258 of 2009. 15 appropriate forum for adjudication of the dispute would be otherwise those given in the Act."
39. This view of law was repeated by the Hon'ble three Bench judgment of the Hon'ble Supreme Court reported as "Skypak Couriers Ltd. v. Tata Chemicals Ltd." 2000 CTJ 321 (Supreme Court) (CP) in which it was held by the Hon'ble Supreme Court as under:-
"Even if there exists an arbitration clause in an agreement and a complaint is made by the consumer, in relation to certain deficiency of service, then the existence of an arbitration clause will not be a bar to the entertainment of the complaint by the Redressal Agency, constituted under the Consumer Protection Act, since the remedy provided under the Act is in addition to the provisions of any other law for the time being in force."
40. The same view of law was repeated by the Hon'ble Supreme Court in another judgment reported as "Secretary, Thirumurugan Cooperative Agricultural Credit Society v. M. Lalitha (dead) through Legal Representatives and others" 2004 CTJ 1 (Supreme Court) (CP) in which it was held by the Hon'ble Supreme Court as under:-
"13. As per Section 3 of the Act, as already stated above, the provisions of the Act shall be in addition to and not in derogation to any other provisions of any other law for the time being in force. Having due regard to the scheme of the Act and purpose sought to be achieved to protect the interest of the consumers, better the provisions are to be interpreted broadly, positively and purposefully in the context of the present case to give meaning to additional/extended First Appeal No.258 of 2009. 16 jurisdiction, particularly when Section 3 seeks to provide remedy under the Act in addition to other remedies provided under other Acts unless there is clear bar."
41. Hon'ble Supreme Court in M. Lalitha's case (supra) relied upon various other judgments of Hon'ble Supreme Court and it was specifically held that the provisions of Section 90 of the Tamil Nadu Cooperative Societies Act, 1983 do not bar the remedy of the consumer under the Act and it was held by the Hon'ble Supreme Court as under:-
"The remedies that are available to an aggrieved party under the 1986 Act are wider. For instance in addition to granting a specific relief the forums under the 1986 Act have jurisdiction to award compensation for the mental agony, suffering, etc., which possibly could not be given under the Act in relation to dispute under Section 90 of the Act. Merely because the rights and liabilities are created between the members and the management of the society under the Act and forums are provided, it cannot take away or exclude the jurisdiction conferred on the forums under the 1986 Act expressly and intentionally to serve a definite cause in terms of the objects and reasons of the Act, reference to which is already made above. When the decision of Dhulabhai's case was rendered, the provisions similar to 1986 Act providing additional remedies to parties were neither available nor considered. If the argument of the learned counsel for the appellant is accepted, it leads to taking away the additional remedies and First Appeal No.258 of 2009. 17 forums expressly provided under the 1986 Act, which is not acceptable."
42. Hon'ble Delhi High Court has gone still ahead and gave wider interpretation to the provisions of Section 3 of the Act in the judgment reported as "HINDUSTAN MOTORS LTD. v. AMARDEEP SINGH WIRK & ORS."
III(2009) CPJ 417 (DB) that the proceedings under the Consumer Protection Act, 1986 and the proceedings in the civil court can proceed simultaneously even if issues involved in the two proceedings are substantially similar. It was further held that the remedies under the Act and the civil court are independent of each other. The existence of parallel or other adjudicatory Forums cannot take away or exclude jurisdiction created under the Consumer Protection Act, 1986. It was held by the Hon'ble Delhi High Court as under:-
"15. On the contrary, the judgments of the Supreme Court, as noticed above, clearly state that as per Section 3 of the Act the provisions of the Act are in addition to and not in derogation of any other provision of any other law for the time being enforced. Having due regard to the scheme of the Act and the purpose sought to be achieved to protect the interest of the consumers better, the provisions are to be interpreted broadly, positively and purposefully to give meaning to additional/extended jurisdiction, particularly when Section 3 seeks to provide remedy under the Act in addition to other remedies provided under other Acts unless there is a clear bar."
43. Even the Hon'ble National Commission was pleased to hold in the judgment reported as "MAHYCO MONSANTO BIOTECH (I) LTD. & ANR. v. BODDULURI JEEVAN KUMAR & ANR." III(2009) CPJ 379 (NC) that the Consumer Protection Act, 1986 being a special act having additional/extended First Appeal No.258 of 2009. 18 jurisdiction, the provisions of Seeds Act, 1966 do not take away the remedy made available to the consumers under Section 3 of the Act. Similar view was taken by the Hon'ble National Commission in the judgment reported as "National Seeds Corpn. Ltd. v. P.V. Krishan Reddy and others" 2009 CTJ 522 (CP) (NCDRC) in which it was held by the Hon'ble National Commission that the existence of an arbitration clause does not bar the jurisdiction of the Consumer Fora under the Act.
44. Hon'ble National Commission in another judgment reported as "HARYANA URBAN DEVELOPMENT AUTHORITY v. DR. MAYA VAID"
II(2009) CPJ 348 (NC) was pleased to hold that where the appeal was dismissed by the Administrator HUDA, it was not necessary for the consumer to challenge the said order in the Hon'ble High Court by filing writ petition. The consumer could still resort to the remedy made available under Section 3 of the Act.
45. In another judgment reported as "E.I.C.M. EXPORTS LTD. v SOUTH INDIAN CORPN. (AGENCIES) LTD. & ANR." III(2009) CPJ 73 (SC) the Hon'ble Supreme Court was pleased to hold that the proceedings under the Act do not amount to suit and the provisions of the Act would apply in preference to the provisions of the Indian Carriage of Goods by Sea Act, 1925.
46. In view of the discussion held above and the overwhelming thrust of the law laid down by the Hon'ble Supreme Court placed on the provision of Section 3 of the Act, it is held that the remedy available under Section 3 of the Act can be availed by the consumer on the allegations that services rendered by the respondents were defective or deficient and seek compensation. The jurisdiction of the District Forum is not barred on the plea that arbitration clause as provided in the Punjab Cooperative Societies Act was applicable.
47. The next submission of the learned counsel for the appellant was that the complaint filed in the District Forum virtually amounts to civil suit for recovery and the complaint has been filed under the Act in order to avoid payment of court First Appeal No.258 of 2009. 19 fee. Hence it was submitted that respondent No.1 should have filed a civil suit instead of initiating proceedings under the Act.
48. This submission has been considered.
49. Even if the suit was maintainable but the remedy provided under the Act was an additional remedy and this remedy cannot be denied to respondent No.1 merely because a suit was maintainable.
50. As has been discussed above, the Hon'ble Delhi High Court has been pleased to hold that the proceedings under the Consumer Protection Act, 1986 and the proceedings in the civil court can proceed simultaneously even if issues involved in the two proceedings are substantially similar and both the remedies can be availed by the consumer. Therefore merely because the civil suit was maintainable, respondent No.1 cannot be denied the remedy to institute the present complaint under the Act, 1986.
51. It was further submitted by the learned counsel for the appellant that the bye-laws of the respondent Society have been proved as Ex.OP-6. Only the Members could enter into transactions with the respondent Society and only the remedy available under these bye-laws could have been availed by respondent No.1. Hence it was submitted that respondent No.1 being a Member could not go beyond the bye-laws.
52. This submission has been considered. It has no merits. The question before this Commission to be considered is whether respondent No.1 had availed the services of the respondent Society by depositing the money with it through its office bearers and whether the office bearers of the respondent Society had accepted the money with the assurance to refund the same with interest. Whether respondent No.1 was a Member of the respondent Society or not is not material. The material thing is that respondent No.1 had availed the services of the respondent Society by depositing the money with it. Since the appellant and respondents No.3 to 7 failed to render services expected of them she has filed the complaint under the provisions of the Act. It has already been discussed in detail First Appeal No.258 of 2009. 20 that it was not mandatory for respondent No.1 only to initiate proceedings under the Punjab Cooperative Societies Act.
53. It was further submitted that some of the office bearers including the appellant were transferred from Muktsar. They were no longer the functionaries of the respondent Society and, therefore, they were not liable.
54. This submission has been considered.
55. Admittedly the appellant and respondents No.3 to 7 are the President, Vice President and other office bearers of the respondent Society. Being the office bearers obviously they were managing the affairs of the respondent Society. Even if the appellants were transferred from Muktsar, they continued to hold their offices in the respondent Society. Therefore respondent No.1 was justified in believing that the appellant and respondents No.3 to 7 were the office bearers of the respondent Society. Even after their transfers from Muktsar, the appellants and other respondents continued to hold their official position in the respondent Society and they cannot be absolved from their liability. If the appellant and other respondents had resigned from their official position they could have claimed exemption from their liability but since they did not cease to be the office bearers of the respondent Society, they cannot be absolved merely because they were transferred from Muktsar.
56. It was further submitted by the learned counsel for the appellants that they were not given an opportunity to cross-examine the witnesses produced by respondent No.1.
57. This submission has been considered.
58. The proceedings before the District Forum are summary in nature. These proceedings are determined on the basis of affidavits/documents and it is not necessary that the witnesses are examined and cross-examined. Detailed procedure is not adopted in the District Forums. The object of the Act is to decide the proceedings in a summary way and speedily. The appellant and other respondents had full opportunity of producing the affidavits/documents in support First Appeal No.258 of 2009. 21 of their respective versions and they had produced the affidavits/documents which were taken on record and were duly considered.
59. Moreover the appellant and other respondents had not filed any application before the District Forum about their desire to cross-examine the witnesses produced by respondent No.1. If they had filed any application to that effect that could have been decided by the learned District Forum and if an order adverse to the interest of the appellant and other office bearers had been passed, it could have been challenged by them by filing revision petition and they could have sought an opportunity to cross-examine the witnesses. However this has not been done by the appellant and other respondents. Therefore now they cannot turn around and debunk the proceedings only on the ground that they were not given an opportunity to cross-examine the witnesses.
60. It was further submitted by the learned counsel for the appellant that the District Forum has fixed the liability jointly and severally whereas the amount was accepted by Krishan Kumar Gawri, Secretary-cum-Cashier respondent No.5. Hence it was prayed that the appellant and respondents No.3, 4, 6 and 7 are not liable to pay any amount to respondent No.1.
61. This submission has been considered.
62. Since the appellant and respondents No.3, 4, 6 and 7 were also the office bearers of the respondent Society, therefore, they were deemed to be running the affairs of the respondent Society in the eyes of law even if the amount had been accepted by Krishan Kumar Gawri, Secretary-Cum-Cashier, respondent No.5 alone on behalf of the respondent Society. Obviously it was so done by him in his capacity as Secretary-Cum-Cashier. The appellant and respondents No.3, 4, 6 and 7 cannot avoid their liability as they were the office bearers of the respondent Society at that time. Therefore it is held that appellant and respondents No.3, 4, 6 and 7 along with respondent No.5 are equally liable to pay the amount to respondent No.1. Besides that the respondent Society is also liable. First Appeal No.258 of 2009. 22
63. In view of the discussion held above, respondent no.1 is held entitled to the refund of Rs.10,00,000/- with interest at the rate of 12% per annum from the date of deposit till the date of payment. Since the money has been accepted on behalf of the respondent Society, therefore, the respondent Society is liable to pay the whole amount of Rs.10,00,000/- with interest at the rate of 12% per annum to respondent No.1.
64. The appellant and respondents No. 3 to 7 being the office bearers of the respondent Society are also liable to make the payment of Rs.10,00,000/- along with interest at the rate of 12% per annum from the dates of deposits till the date of payment to respondent No.1 in equal share. They are also liable to make payment of Rs.5,000/- each to respondent No.1 as directed by the learned District Forum.
65. Accordingly all these appeals, namely, First Appeal No.258 of 2009, First Appeal No.271 of 2009 and First Appeal No.283 of 2009 are dismissed.
66. Vijay Kumar Sukhija appellant had deposited an amount of Rs.25,000/- with this Commission at the time of filing of the appeal. In pursuance of the order dated 21.5.2009 he had further deposited an amount of Rs.1,00,000/- with this Commission on 22.6.2009. This amount of Rs.1,25,000/- with interest accrued thereon, if any, be remitted by the registry to respondent No.1 by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and to the appellant. This amount shall be adjusted against the principal amount.
67. The interest on the amount of Rs.1,25,000/- shall stop running with effect from the dates the appellant had deposited the same in this Commission. Interest on these amounts shall be what has accrued on these amounts when these amounts remained deposited by this Commission in the Bank.
68. Remaining amount of his share shall be paid by the appellant to respondent No.1 immediately.
First Appeal No.258 of 2009. 23First Appeal No.271 of 2009:
69. Arun Singla, Sham Sunder Bedi and Akshoni Kumar appellants had deposited an amount of Rs.25,000/- with this Commission at the time of filing of the appeal on 5.3.2009. In pursuance of the order dated 19.3.2009 they had further deposited an amount of Rs.5,00,000/- with this Commission on 22.4.2009. This amount of Rs.5,25,000/- with interest accrued thereon, if any, be remitted by the registry to respondent No.1 by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and to the appellants. This amount shall be adjusted against the principal amount.
70. The interest on the amount of Rs.5,25,000/- shall stop running with effect from the dates the appellants had deposited the same in this Commission. Interest on these amounts shall be what has accrued on these amounts when these amounts remained deposited by this Commission in the Bank.
71. Remaining amount of their share shall be paid by the appellants to respondent No.1 immediately.
First Appeal No.283 of 2009:
72. Karnail Singh appellant had deposited an amount of Rs.25,000/- with this Commission at the time of filing of the appeal on 6.3.2009. In pursuance of the order dated 21.5.2009 he had further deposited an amount of Rs.1,00,000/- with this Commission on 12.6.2009. This amount of Rs.1,25,000/- with interest accrued thereon, if any, be remitted by the registry to respondent No.1 by way of a crossed cheque/demand draft after the expiry of 45 days under intimation to the learned District Forum and to the appellant. This amount shall be adjusted against the principal amount.
73. The interest on the amount of Rs.1,25,000/- shall stop running with effect from the dates the appellant had deposited the same in this Commission. Interest on these amounts shall be what has accrued on these amounts when these amounts remained deposited by this Commission in the Bank.
First Appeal No.258 of 2009. 24
74. Remaining amount of his share shall be paid by the appellant to respondent No.1 immediately.
75. The liability of the appellant and respondents No. 3, 4, 6 and 7 shall stand discharged on the date they make the payment of remaining amount of their shares to respondent No.1.
76. Since the appeal filed by Krishan Kumar Gawri respondent No.5, namely, First Appeal No.330 of 2009 has been dismissed for want of prosecution by this Commission vide order dated 21.8.2009, therefore, respondent No.1 may recover the amount of his share from him in accordance with law. The amount can also be recovered from the assets of the respondent Society.
77. The arguments were heard in these appeals on 6.10.2009 and the orders were reserved. Now, the order be communicated to the parties.
(JUSTICE S.N. AGGARWAL)
PRESIDENT
(LT. COL. DARSHAN SINGH [RETD.])
MEMBER
October 20, 2009 (PIARE LAL GARG)
Bansal MEMBER