State Consumer Disputes Redressal Commission
M/S. Hi- Tech Dry Wash & Hygienic ... vs The Manager, Kerala Financial ... on 12 October, 2012
Daily Order
Kerala State Consumer Disputes Redressal Commission Vazhuthacaud,Thiruvananthapuram First Appeal No. A/11/836 (Arisen out of Order Dated 28/05/2010 in Case No. CC/03/109 of District Pathanamthitta) 1. Hi Tech Dry Wash Pathanamthitta Pathanamthitta Kerala ...........Appellant(s) Versus 1. The Manager,KFC Pathanamthitta Branch,College Road, Pathanamthitta Kerala ...........Respondent(s) BEFORE: SMT.A.RADHA PRESIDING MEMBER PRESENT: ORDER
KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAUD, THIRUVANANTHAPURAM.
APPEAL NO. 836/11
JUDGMENT DATED : 12.10.2012
PRESENT:
SHRI. M.K. ABDULLA SONA : MEMBER
SMT. A. RADHA : MEMBER
1. M/s. Hi- Tech Dry wash & Hygienic Services
P.O. Box 57, Pathanamthitta P.O.,
Pin - 689 645,
Represented by its Power of Attorney-
Sri.Sharafuddeen.
2. Sri. Sharafuddeen, S/o. Aboobacker,
Shannovre House, Mele Vettipuram,
Pathanamthitta Pin -689 645. : APPELLANTS
3. Smt. Seenath Sharafuddeen,
W/o. Sharafuddeen,
Shannovre House, Mele Vettipuram,
Pathanamthitta Pin -689 645.
(By Adv. Narayan R.)
Vs
1. The Manager, Kerala Financial Corporation,
Pathanamthitta Branch, College Road,
Pathanamthitta, Pin. 689 645.
2. The Managing Director, : RESPONDENTS
Kerala Financial Corporation,
Vellayambalam, Thiruvananthapuram.
(By Adv. V.S. Bhasurendran Nair)
JUDGMENT
SMT. A. RADHA : MEMBER Dissatisfied by the order of dismissal passed by the CDRF, Pathanamthitta in OP No.109/2003 the complainants came up in appeal.
2. The facts of the case are that the complainants applied for a loan of Rs.15 lakhs for starting a dry wash unit for self employment purpose. A comprehensive project report was prepared and submitted to the opposite parties. The complainants were pioneers in this project and they were given training under STED. As per the directions of the opposite parties the complainant submitted application with relevant documents and collateral security for starting the project. It is the case of the complainant that on getting the verbal assurance from the officers of the opposite party the complainants initiated works for construction of workshop, appointment of employees and also training for employees at Hyderabad. The complainant invested huge money for placing orders for the dry cleaning machines. At this juncture, the opposite parties informed rejection of the loan application stating that the proposal is neither technically feasible nor financially viable. Several communications were sent to the opposite parties to know the rationale behind the rejection of the loan application, which was not responded. The complainant had to spend a lot of money for the initial preparation and the act of the opposite parties amounted to deficiency in service and unfair trade practice and sought for a compensation of Rs.13,08,000/- on various heads.
3. The opposite parties filed the written version contending that an application was received for a loan of Rs.15,00,000/- from the complainants. On inspection of the site and on market survey about the prospective suppliers of the complainants' project, the project was found not feasible. The credibility of the supplier of machine was also doubtful. These reports were under consideration by the sanctioning authority of the opposite parties and the said committee rejected the application on the ground of lack of technical feasibility and financial viability. It is also stated that the complainants were asked to submit any other feasible project for which the complainants were not amenable. It is an admitted fact that as per norms the opposite parties collected processing charges to accept the loan application. There is no deficiency in service on the part of the opposite parties or any illegality in their action. The sanctioning committee inspected the site and also the future feasibility of the project. The discretion of granting or refusing was only the privilege of the opposite parties after conducting studies in the field. The opposite parties are being State Financial Institution no individual interference in the matter is involved.
4. On the side of the complainant PW1 to PW6 were examined and documents marked as Exts.A1 to A16 series. DW1 and DW2 were examined on the side of the opposite parties and documents marked as Exts.B1 to B8 (a). The Ext.C1 and Ext.C2 also were marked as court exhibits. The Forum below on appreciation of the documents and evidence found that the rejection of loan application was done stating reasons and no illegality as such there is no deficiency in service on the part of the opposite parties and the complaint was dismissed by the Forum below.
5. The argument raised by the counsel for the appellant is that the complainants were NRIs who planned for starting a dry wash unit availing a loan of Rs.15,00,000/- from the opposite parties. As instructed by the opposite party 15% collateral security was submitted along with the loan application and informed that the processing time for sanctioning of loan was two to four weeks. It is also argued that the legal officer verbally confirmed the loan application. Based on the positive approach the complainant started initial work for the project by constructing workshop, appointing employees and also sending technical staff for training to Hyderabad and Mumbai caused to incur a lot of money to the complainant. Several discussions were held with the Branch Manager and Regional Manager. In the meantime, several communications were exchanged in between the parties. The sanctioning authority decided to reject the project and informed the rejection of loan application on 21.11.2001 that the project is neither technically feasible nor financially viable. The rejection of the loan application after giving verbal sanction is a clear deficiency in service which caused financial loss and mental agony to the complainants and the opposite parties are liable to compensate and claimed for Rs.13,08,000/-.
6. The contention of respondent/opposite parties' is that the rejection of the loan application is based on the studies and enquiries conducted by the officials of the respondents. It is an admitted fact that the respondent accepted the processing charges of Rs.1875/- as per norms of Kerala Financial Corporation which is an agency established by the State Government for providing loan for starting self-employment projects. The processing fee remitted on filing the application cannot be refunded as per the norms of the opposite parties. Only after payment of processing fee the application for loan will be entertained. On receipt of application form the respondents through their officials conduct studies on the feasibility of the project and only after satisfying the feasibility, the loan would be sanctioned. The definite objection raised by the respondents is that on enquiry regarding the supplier it was not a satisfactory one and revealed that no such agency is in existence which was not rebutted in evidence by the complainants. Further the project had not furnished any details of marketing set up. No case is pleaded or proved that the machinery required is available or substituted machinery can be provided. The respondent also extended the service for submission of any other feasible projects substituting the proposed project. The respondent returned the documents to the appellant on 28.1.2002. Prior to the sanction of loan, the act of the complainant cannot be multed upon the respondent. The rejection of the loan application is not an illegal action and cannot be treated as a deficiency in service on the part of respondent/opposite party.
7. On going through the evidence and records and on hearing the counsels, we find that the sanctioning of loan is a discretion vested upon the respondents and being a State Government concern the report and studies conducted by the respondents/opposite parties were not in favour of the appellants. Further the respondents extended the service for any other feasible project which was not amenable to the appellants. On that ground no deficiency in service can be attributed on the part of the respondents/opposite parties. The verbal confirmation is not an acceptable justification and cannot be taken into evidence in favour of the appellants. In the absence of cogent evidence the act of rejection of loan application by appellants does not amount to deficiency in service and the Forum below rightly dismissed the complaint.
In the result, appeal is dismissed and we find no infirmity in the order passed by the Forum below.
Office is directed to send a copy of this order to the Lower Forum with the LCR.
A. RADHA : MEMBER M.K. ABDULLA SONA : MEMBER Da [ SMT.A.RADHA] PRESIDING MEMBER