1. The order dated 4.7.2012 passed by the District Consumer Disputes Redressal Forum (Central) in the matter of M/s. Indo Arab Air Services v. ICICI Home Finance Company Ltd., directing the ICICI to pay to the complainant a sum of Rs. 13,821 with interest @ 12% p.a. from 15.3.2006 till realisation and, secondly, interest @ 12% on the amount of Rs. 3,41,507 from 15.3.2006 to 12.2.2007 apart from Rs. 20,000 as compensation for mental agony and Rs. 5,000 as litigation cost, has been assailed before this Commission under Section 15 of the Consumer Protection Act 1986, the Act, by the complainant company, for short appellant, against the ICICI Home Finance Company Ltd., hereinafter referred to as respondent, claiming for setting aside the order so passed and praying for relief as under:
It is most respectfully prayed that this Hon’ble Commission be pleased to entertain this appeal and:
(a) Set aside the impugned order dated 4.7.2012 passed by the learned District Consumer Disputes Redressal Forum (Central) Maharana Pratap Bus Terminal, Mezzanine Floor, Kashmiri Gate, Delhi-110006 in Consumer Complaint No. 347/07.
(b) Pass an order directing the respondent to:
(i) Refund an amount of Rs. 9,25,000 along with interest @ 24% p.a. with effect from 22.11.2005 till its realization.
(ii) Refund an amount of Rs. 13,821 along with interest @ 24% with effect from 12.2.2007 till its realisation.
(iii) Pay to the appellant an amount of Rupees 78,172 being interest @ 24% p.a. for the period of 15.3.2006 to 12.2.2007 on amount of Rupees 3,55,328.
(iv) Pay damages of Rupees 5,00,000 for causing harassment, agony and loss to the appellant.
(v) Pay Rs. 75,000 as litigation expenses to the appellant.
(vi) Pass any other order as this Hon’ble Commission may deem fit and proper in the interests of justice.
2. Facts of the case necessary for the disposal of the appeal are these.
3. The appellant company had applied for a loan of Rs. 5 crores from the respondents with interest at the rate of 9.25% p.a. for a term of 120 months, with equated monthly instalments of Rs. 6,40,164 per month which loan was approved in the month of August 2005 against the property bearing number B-21, Maharani Bagh, New Delhi. However much to the shock and surprise of the appellant the respondents had deducted two EMIs totalling Rs. 12,80,328 without the loan having been disbursed and accordingly they sought for the refund of the requisite amount. As a consequence thereof an amount of Rs. 3,55,328 was refunded but an amount of Rs. 9,25,000 claiming to be interest for 73 days was allegedly retained. Several requests were made for the refund the amount but that could evoke no response. All the efforts made in this behalf proved an exercise in futility. Legal notice issued could not persuade the Bank to refund, leading to filing of a complaint before the Consumer Forum for the redressal of their grievances. The said complaint was disposed of with directions to the OPs but disallowing the claim to the complainant to extent of Rs. 9,25,000, accepting the contention of the bank that the retained amount is interest.
4. In these circumstances the appeal has been preferred on the ground that the District Forum has passed the order in violation of the principles of natural justice. Secondly, the impugned order suffers from material infirmities, inasmuch, as without determining the issues raised by the appellant which go to the root of the dispute, the District Forum could not even have entered into evaluating the merits of the case. Thirdly the impugned order dated 4.7.2012 is liable to be set-aside being bad and perverse on the facts of the case. The learned District Consumer Forum, has wrongly held that the respondent made the cheques on the loan amount on 30.8.2005 without delving into the evidence. The District Forum has further erred in law and on facts by holding that the respondent is entitled for interest on the sanctioned loan amount prior to the disbursement of the loan amount. Fourthly the impugned order is bad and liable to be set-aside as the claim of the complainant qua the amount of Rs. 9,25,000 has been rejected. Infact the said amount was wrongfully encashed by the respondent by misusing the authority given by the appellant to encash the ECS against the EMIs for the loan to be disbursed to the appellant. The respondent has encashed two ECS of Rs. 6,40,164 against EMIs for the month of October and November against the terms of the loan and without even disbursing the loan amount to the appellant. The act of encashing the ECS by the respondent prior to disbursement of loan amount is manifestly an unfair trade practice besides the same tantamounts to deficiency of services.
5. Respondents were noticed and in response thereto their Counsel made a statement on 26.4.2016 stating that they do not wish to file reply.
6. Short question for adjudication in this appeal is whether there exists any infirmity in the order assailed before this Commission and, secondly, whether the complainant/appellant is entitled for the relief claimed in this appeal.
7. This appeal was listed for final hearing on 12.12.2019 when the Counsel for both sides appeared and advanced their arguments, the appellant for the refund of amount of Rs. 9,25,000 along with interest @ 24% w.e.f. 22.11.2005 and for the refund of Rs. 13,821 along with interest @ 24% w.e.f. 12.2.2007 and the respondents praying for dismissal of the appeal raising their objection both on merit and on technical ground namely, that the appellant is not a consumer and secondly, this Commission lacks territorial jurisdiction.
8. I have perused the records of the case and given a thoughtful consideration to the subject matter.
9. The learned Counsel for the appellant argued that the findings of the District Forum to the effect that the respondent was within competence to deduct interest, well before the loan amount was deducted, is a distressing violation of the principles of natural justice. Infact in a similar case, the Hon’ble Kerala State Consumer Disputes Redressal Commission, Thiruvananthapuram, had been pleased to observe as below:
The Forum has held that the claim of the OPs that the complainant is liable for interest from the date of sanction of the loan i.e. 29.3.1997 and not from the date of the disbursal i.e. 24.7.1997 is against the principles of nature of justice and all norms of banking practice and rightly so.
Secondly with regard to the objection of the respondents that the complainant being a partnership firm and having taken the loan for the business activities, is not a consumer within the meaning of Section 2(1)(d) of the Act and thus not entitled to raise a consumer dispute under Section 2(1)(e). The learned Counsel for the appellant on the other hand clarified that they being a partnership firm are also consumer as contemplated under Section 2(1)(m)(i) of the Act which says that the person includes a firm. However whether the transaction done or the issue involving sanction of the loan is within the meaning of Section 2(1)(d) would be deliberated upon hereinafter. Further as regards the objection of the respondent regarding territorial jurisdiction of this Commission, the argument of the appellant, drawing the attention of the judgment of the Hon’ble Supreme Court in the matter of Sneh Lata Goel v. Pushplata or Ors., as reported in (2019) 3 SCC 549, is that it is a fundamental principal of law that objections regarding territorial jurisdiction should be raised in the Court of first instance, at the earliest possible opportunity. It cannot be raised subsequently in appeal.
10. I may at this stage advert to the defence of the OPs/respondent filed before the District Forum to see if any objection regarding the factum whether the complainants are consumer and secondly, whether this Commission enjoys the territorial jurisdiction to hear and to dispose of this complaint were taken. On perusal it is noticed that objections to this effect were not taken during the pendency of the matter before the District Forum. Besides the orders of the District Forum has not been assailed by the respondents. The learned Counsel for the respondents raising these objection has submitted relying on Order 41 Rule 33 of the Code of Civil Procedure 1908 that the Appellate Court shall have power to pass any decree and make any order which ought to have been passed or made and to pass or make such further or other decree or order as the case may require, and this power may be exercised by the Court notwithstanding that the appeal is as to part only of the decree and may be exercised in favour of all or any of the respondents or parties, although such respondents or parties may not have filed any appeal or objection and may, where there have been decrees in cross-suits or where two or more decrees are passed in one suit, be exercised in respect of all or any of the decrees, although an appeal may not have been filed against such decrees.
11. At this stage for examining the objection of the respondents raising territorial jurisdiction of this Commission. I may advert to Section 21 of the Code of Civil Procedure (supra). The said provision posits as under:
Objections to jurisdiction:
No objection as to the place of suing shall be allowed by any appellate or Revisional Court unless such objection was taken in the Court of first instance at the earliest possible opportunity and in all cases where issues are settled at or before such settlement and unless there has been a consequent failure of justice.
No objection as to the competence of a Court with reference to the pecuniary limits of its jurisdiction shall be allowed by any appellate or Revisional Court unless such objection was taken in the Court of first instance at the earliest possible opportunity and in all cases where issues are settled at or before such settlement and unless there has been a consequent failure of justice.
No objection as to the competence of the executing Court with reference to the local limits of its jurisdiction shall be allowed by any appellate or Revisional Court unless such objection was taken in the executing Court at the earliest possible opportunity, and unless there has been a consequent failure of justice.
12. On perusal of the said provision it is manifestly clear that the objection of the respondents regarding territorial jurisdiction of this Commission, the objection not having been taken before the District Forum cannot sustain and it is accordingly overruled.
13. The learned Counsel for the respondents with respect to the second objection to the effect that the appellant is not a consumer within the meaning of Section 2(1)(d) of the Act, the transaction in the given case since for commercial purpose, being a legal submission argued that this, can be raised at any stage if it goes to the root of the matter and involves jurisdictional issue. I am in agreement with the submission made. [Reference: Orders passed by the Hon’ble High Court of Delhi in the matter of Union of India v. Shankar Raju, in WP(C) No. 4557 of 2007 decided on 13.12.2007. In that case involving the allotment of Govt. accommodation to Sh. Shankar Raju Member of the Central Administrative Tribunal as he then was, the Hon’ble CAT on the judicial side accepted the claim, but when the appeal was preferred by the Union of India, the objection regarding maintainability of the case before the Hon’ble CAT was taken, which objection was resisted by Sh. Shankar Raju on the ground that the said objection, not having been taken before the Court below, cannot be raised at the appellate stage. The Hon’ble High Court was pleased to hold that if an issue involves jurisdictional issue and goes to the root of the matter, the objection can be examined and considered even at the appellate stage notwithstanding the fact whether that objection was taken at the Original stage or not. Hence the objection of the OPs involving jurisdictional issue whether the complainant is a consumer or not, the subject which goes to the root of the matter can be taken and deliberated upon by the appellate forum regardless of whether this objection was taken at the initial stage.
14. Having reached to this conclusion I may examine the objection of the respondent whether the appellant/complainant in the subject matter pertaining to the sanction of loan is a consumer within the meaning of Section 2(1)(d) of the Act.
15. The crux of the issue in the complaint, in the appeal is whether the complainant/appellant is a consumer within the meaning of Section 2(1)(d) of the Act in which event alone they would be entitled to raise a consumer dispute before the consumer forum. Section 2(1)(d) of the Act referred to above posits as under:
“Consumer means any person who—
I. Buy any goods for a consideration which has been paid or promised of partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or
II. [hires or avails of] any services of 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 person who avails of such services for any commercial purpose];
Explanation—For the purpose of this Clause, “commercial purpose” does not include use by person of goods bought and used by him and services availed by him exclusively for the purpose of earning his livelihood by means of self employment.
16. On a careful perusal of the provision of the Act it is evident that transaction done for commercial purpose are outside the scope and ambit of the aforesaid provision save the condition when availing of the service is exclusively for the purposes of earning livelihood by means of self-employment. Exception is carved out to the limited extent of these two factors and both the factors must exists to be within the parameters of Section 2(1)(d). To put it differently there should be personal use while availing the services unconnected with any commercial angle, profit or dividend. In the subject matter there exists no averments that the loan was procured and the transaction was done for livelihood by employment. This leads to an inescapable conclusion that the complainant in the given case is not a consumer within th
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e meaning of Section 2(1)(d) of the Act. 17. The Hon’ble NCDRC in the matter of Shiv Shankar Lal Gupta v. Kotak Mahindra Bank Ltd. & Ors. as reported in II (2013) CPJ 56 (NC), is pleased to hold that loan against Collateral Security of immovable property is a commercial transaction which means he is not a consumer. 18. Similar view was taken in the case of Sutlej Industries Ltd. v. Punjab National Bank, I (2018) CPJ 593 (NC), the Hon’ble National Commission has held that if the business activities of a company cannot be conveniently undertaken without the goods purchased or the services hired or availed by a company, such purchase or hiring/availing as the case may be, would be for a commercial purpose, because the objective behind such purchase of goods or hiring or availing of the services would be to enable the company to earn profits by undertaking and advancing its business activities. 19. Having regard to the discussion done and the legal position explained I am of the considered view that the appellant/complainant having procured the loan for commercial purpose is not a consumer and if that be the case the complainant company cannot raise a consumer dispute as contemplated under Section 2(1)(e) of Act. 20. In these circumstances both appeal in totality and the complaint filed before the District Forum are dismissed leaving the parties to bear the cost. Ordered accordingly. 21. A copy of this order be forwarded to the parties to the case free of cost as statutorily required. A copy of this order be forwarded to the District Forum for information. File be consigned to records. Appeal dismissed.