T.S.P. Moosath : Judicial Member

The complainant in CC.No.153/2014 of the Consumer Disputes Redressal Forum, Idukki , in short, the district forum has filed the appeal against the order passed by the district forum by which the complaint filed by him was dismissed.

2. The case of the complainant is that Managing Partner of a partnership firm named Popular Auto Spares for selling auto spare parts. Mr.Scaria Kurian, Perumpuzhamoolayil, Adimali is the other partner. They are running the business for their livelihood. The complainant in the year 2010 availed an over draft of Rs 5,00,000/- from the opposite party through Loan Account No.105102276812. As per the terms of loan agreement, the complainant is entitled to get the overdraft facility upto Rs 5,00,000/- and the opposite party shall honour the cheques which was issued by the complainant to their suppliers upto Rs 5,00,000/- in a financial year. The over draft facility has to be renewed every year after getting the instruction from the opposite party and the complainant complied all stipulations without fail till date. On 01.07.2011 a cheque bearing No.029190 issued by the complainant to Jai Agencies was mistakenly dishonoured by the opposite party and by knowing this the opposite party tendered an unconditional apology to the complainant. Again on 28.02.2013 a cheque bearing No.15889 issued by complainant was dishonoured as insufficient funds, even though there was sufficient funds in the account. For that also the opposite party given written apology on 28.03.2013. In spite of repeated assurance, on 04.11.2013 another cheque for an amount of Rs 1,00,000/- issued by the complainant to the Popular Mega Motors was dishonoured. Due to that the Popular Mega Motors has reduced the credit limit which the complainant was enjoying for several years. Again on 24.02.2014 and on 03.04.2014 also the complainant’s cheques were dishonoured due to the carelessness and negligence of the opposite party. The act of the opposite party is gross deficiency in service. Due to the negligent act of the opposite party, the complainant suffered severe loss and frequent dishonor of cheques affected the credibility of his business and it may adversely affect the complainant’s future dealings with other banks and also several companies refused to supply products even on full payment. Formerly the companies sent the products through private bus, and due to the nonpayment in time they had withdrawn. Then the complainant’s credibility in the dealings that was created by him through years effort was lost. This caused considerable mental agony to the complainant. Hence the complainant approached the forum and prayed for allowing Rs 5,00,000/- from opposite party towards compensation for the loss of business of the complainant and also for getting Rs 2,00,000/- from the opposite party to the complainant towards compensation for pain and sufferings caused by the opposite party and also for getting an amount of Rs 5000/- towards litigation cost.

3. Opposite party entered appearances and filed detailed written version denying the allegations in the complaint. It was alleged that the complainant had availed the said loan under small business financial scheme. The opposite party was further alleged that as per paragraph 9 of the complaint, the cause of action for the complaint arose on 28.02.2013 on 24.02.2014 and on 03.04.2014. With respect to the transaction of 28.02.2013, the matter has been settled between the parties. The next instance of dishonor of cheque was on 25.02.2014, with respect to cheqeu No.51853 for Rs 37,464/-. As per the sanction letter of the loan, the complainant have to renew the loan file. In this case the complainant failed to renew the loan file, therefore the said cheque has been dishonoured on 25.02.2014 from centralized clearing processing cell code no.10394 on getting this information, the complainant on 25.02.2014, approached the opposite party and requested for renewing loan file and which has been renewed on 17.05.2014. The opposite party added that, the reason for dishonor of cheque on 03.04.2014 was that, 01.04.2014 is a public holiday with respect of banking as per Negotiable Instruments Act. On 02.04.2014, the branch has been affected by pressure of work due to financial year closing and attendant duties and therefore the stock statement has not been entered in the computer system on 02.04.2014. It is not due to any carelessness or negligence from the part of the opposite party, but it has been dishonoured due to unforeseen reasons. Moreover the allegation that the dishonor of cheque will be entered in CIBIL site which will impede the prospect of the complainant is denied of all merits. The opposite party prayed to dismiss the complaint due to following reasons.

1. There is no willful latches or deficiency of service on the part of the opposite party, as alleged.

2. The complainant has not sustained any pecuniary loss or reduction of credibility as alleged.

3. The disputed cheque dated 28.02.2013 has been settled between the parties and there is no cause of action against the opposite party.

4. The opposite party is still rendering banking service to the complainant as per the existing norms and keeping cordial relationship with the complainant.

5. Dishonour of cheques dated 25.02.2014 and on 03.04.2014 are not due to any negligence or carelessness on the part of the opposite party.

4. The complainant was examined as PW1 and Exts.P1 to P10 (a) were marked on his side. No evidence was adduced by the parties. Considering the evidence adduced by the complainant and hearing both sides the district forum has passed the impugned order, by which the complaint was dismissed. Aggrieved by the order passed by the district forum the complainant has filed the complaint.

5. Heard both sides. Perused the records.

6. There is no dispute to the fact that in year 2010 the complainant availed a over draft facility of Rs 5,00,000/- from the opposite party through the Loan Account No.10512276812. Ext.A1 is the copy of the stamen of account of the complainant in the opposite party bank. As per the terms of the agreement the complainant is entitled to get over draft facility up to Rs 5,00,000/- and opposite party has to honour the cheques, to be issued by the complainant to their suppliers up to Rs 5,00,000/- in a financial year. The allegation of the complainant is that the cheques issued by him to his suppliers were dishonoured by the opposite party on the ground of insufficient funds, even though there was sufficient funds in his account. Alleging deficiency of service on the part of the opposite party the complainant has filed the complaint. Opposite party admitted the dishonoured of the chequs but contended that it was not due to any latches or negligence on their part. The district forum found that with respect to the dishonoured three cheques the opposite party offered apology, one cheque was dishonoured since there was difference in writing of the amount in the cheque. The dishonour memo regarding the one cheque was not produced by the complainant. The district forum found that the complainant failed to prove that he suffered any damages in the business due to the irresponsible attitude of the opposite parties as alleged by him. It is also found that the complainant failed to prove any deficiency of service on the part of the opposite party and dismissed the complaint. Aggrieved by that order the complainant has filed the complaint.

7. The counsel for the appellant submitted that the district forum observed that the complainant has not produced the dishonour memos of the cheques which were dishonoured and it was taken as a ground to reject the claim of the complainant / appellant and that is not correct, since the opposite party had admitted the dishonour of those cheques on the ground of insufficient funds, except in the case of one cheque. Further the complainant has produced Ext.P2 (a) P4 (a) and P9 cheque return memos issued by the opposite party bank. The complainant has also produced Exts.P3, P5 & P6 letters of apology issued by the opposite party bank. Ext.P2 cheque is dated 30.06.2010. The said cheque was dishonoured when presented before the opposite party. Ext.P2 (a) is the dishonour memo issued from the opposite party bank for the reason ‘exceeds arrangement’. It is the case of the complainant that cheque dated 01.07.2011 issued by him was dishonoured when presented before the opposite party bank on the ground of insufficient funds. Ext.P3 is the letter issued by the opposite party to the complainant stating that cheque was returned due to mistake and the opposite party sought pardon for their mistake. The cheque dated 26.02.2013 issued by the complainant was dishonoured when presented before the bank. Ext.P4 is the cheque, Ext.P4 (a) is the cheque return memo. Ext.P5 is the letter issued by the opposite party that the cheque was returned wrongly and they were extremely sorry for the inconvenience caused and it was requested that the cheque may re-presented which will be honoured. During the time of trial, during the cross examination of PW1, the opposite party put up a defense, on the basis of Ext.P4(a), that Ext.P4 cheque was dishonoured for the reason that the amount in the cheque was irregularly drawn. But in Ext.P5 letter the opposite party bank has no such case and in that letter it was requested that the cheque may be re-presented and then it will be honoured. Further the opposite party has no such contention in the version filed by them and it is stated that they have settled the matter with the complainant. So there is no basis in the contention of the opposite party that the said cheque was dishonoured since the amount in the cheque was drawn irregularly. The chque dated 04.11.2013 issued by the complainant was dishonoured. Ext.P6 is the letter issued by the opposite party stating that the said cheque was returned by mistake and the cheque may be re-presented which may be honoured. The opposite party expressed sorry for the inconvenience caused due to the dishonoured of the cheque. It is stated by the complainant that the cheque dated 24.02.2014 and 03.04.2014 were also dishonoured by the opposite party. It is stated by the opposite party that the over draft facility was allowed to the complainant on 23.02.2012 with a written condition to renew it in every two years. So the complainant ought to have to renewe it on or before 23.02.2014. The cheque dated 24.02.2014 was dishonoured on 25.02.2014 and the loan file was renewed on 17.05.2014. So according to the opposite party that the said cheque happened to be dishonoured due to the non renewal of the loan file by the complainant as stipulated in the sanction letter. Even though the said allegation is denied by the complainant and contended that he had renewed the loan file in time, he failed to substantiate his contention. So from the available evidence it has to be found that there was sufficient reason for the opposite party to dishonoured the cheque dated 24.02.2014 issued by the complainant. Regarding the dishonour of the cheque dated 01.04.2014 issued by the complainant, the explanation / reason stated by the opposite party is that 01.04.2014 was a public holiday with respect of banking as per the Negotiable Instrument Act. On 02.04.2014 the branch has been affected by pressure of work due to financial year closing and attendant duties and therefore the statement has not been entered into the computer system on 02.04.2014. The cheque was dishonoured not due to any carelessness or negligence from the part of opposite party, but it has been dishonoured for unforeseen reasons. But in Ext.P9 cheque return memo the reason for the return of the cheque is stated as “funds insufficient ‘’. The opposite party has no case that on 03.04.2014 when the cheque was returned for the reason ‘funds insufficient’, there were no sufficient funds in the account of the complainant.

8. From the evidence, it can be seen that at least on four occasions the cheques issued by the complainant were dishonoured by the opposite party for the reason “in sufficient funds” when there was sufficient fund in his account. Of course, subsequently opposite parties issued letters of apology and on some occasions the cheques were honoured on re-presentation. From the contentions raised by the opposite party, it can be seen that the cheques issued by the complainant happened to be dishonoured due to the carelessness and negligence of the opposite party. The opposite party has not offered any reasonable explanation or reason for the dishonour of the cheques even though it is stated that it happened not because of their latches or negligence. It can be found that there was deficiency of service on the part of the opposite party and so the complainant is entitled to get compensation from the opposite party. So the finding of the district forum that the complainant failed to prove any deficiency of service from the part of the opposite party is not sustainable and is liable to be set aside. We do so.

9. The complainant is a businessman and he had issued cheques to his suppliers. It is stated by the complainant that the frequent dishonour of cheques affected the credibility of his business and some companies refused to supply products even on full payment. PW1 deposed that the cheque for Rs 1,00,000/- issued to Popualr Mega Motors was dishonoured and due to that they had reduced the credit limit which the complainant was enjoying for several years. From the records of the lower forum it is seen that the complainant has produced the copy of the letter dated 31.01.2014 issued by the Popular Mega Motors to him in which it is stated that the cheque dated 31.10.2013 for Rs 1,00,000/- has been bounced in bank due to “ in sufficient funds” in the bank account of the complainant and they will not entertain cheque bounce activity. Therefore they reduced the credit limit of the complainant from Rs 2,00,000/- to Rs 1,00,000/- with effect from 01.04.2014. It is not possible to ascertain whether the said document was marked or not before the district forum.

10. Admittedly the complainant who is a business man issued cheques to different phases in connection with his business activities and it can be easily found that repeated dishonor of cheques issued by him would have certainly affected the credibility of his business, even though the complainant failed to prove any financial loss to him with cogent evidence. From the evidence it has to be considered that some of the cheques were later re-presented and honoured by the opposite party. Further the complainant admitted that he is keeping good relation, with the opposite party bank. Considering all these facts we consider that complainant is entitled to get Rs 25,000/- as compensation for the mental agony and loss suffered by him due to the irresponsible attitude of the opposite party and he is entitled to get Rs 5000/- as cost of the proceedings from the opposite party.

11. The counsel for the respondent submitted that the complainant / appellant is not entitled to get any relief against the respondent / opposite party since the complaint is not maintainable before the district forum. The complainant is a business man and he had issued the cheques in connection w

ith his business transactions and the complainant availed the service of the opposite party for commercial purpose. So the complainant is not a consumer as defined under section 2(1) (d) of the Consumer Protection Act, so the complaint is not maintainable before the district forum. It is to be noted that in the version filed by the opposite party they have not raised such a contention. No question was put to be PW1 regarding that aspect. It is a settled principle of law that the question of law can be raised at any stage of the proceedings. It is to be noted that in the first paragraph of the complaint itself it is stated by the complainant that he is a managing partner of the partnership firm engaged in the spare parts business at Adimali and apart from the complainant Mr.Scaria Kurian is the other partner of the business. The complainant and Scaria Kurian are running the business as a self employment for their livelihood. The complainant and Scaria Thomas are employed in the business and the income from the business is only source of their livelihood. So the contention raised by the counsel for the respondent that the complainant / appellant is not entitled to get any relief, since he is not a consumer as defined in the Consumer Protection Act and hence the complaint is not maintainable before the forum is unsustainable. In the result, the appeal is allowed. The order passed by the district forum is set aside. The opposite party is directed to pay Rs 25,000/- as compensation and Rs 5000/- as cost to the complainant within one month from the date of receipt of the copy of the order, failing which the amount of compensation ordered will carry interest at the rate of 9% till realization.