State Consumer Disputes Redressal Commission

West Bengal

BHABANI BHAVAN (GROUND FLOOR)

31, BELVEDERE ROAD, ALIPORE

KOLKATA – 700 027


S.C. CASE NO-412/A/07





DATE OF FILING : 19.11.07DATE OF FINAL ORDER:16..3.09



APPELLANTS/COMPLAINANTS :

1. The Director Khadi and Village Industries Commission ,

3 Irla Road, Vile Parle (W) , Mumbai-400 056 having its State Office, The State Director , Khadi & Village Industries Commission, 33, Chittaranjan Avenue (6th and 7th floor), P.S- Hare Street, Kolkata –700 012, West Bengal.





RESPONDENTS/O.P.S : :

1. Shri Prasanta Kumar Dutta ,

Son of Sri Ashok Kumar Dutta of Village and PO- Bamondasbati, P.S- Kandi, Dist- Murshidabad, West Bengal.



2. The Manager, Bank of Baroda, Kharsa Branch, PO- Kharsa,

Dist – Murshidabad, W.B





3. Bank of Boroda, 27, Sarat Bose Road, Kolkata- 700 017. W.B.





BEFORE : HONBLE JUSTICE :

MEMBER : Shri. A.K. Ray.

MEMBER : Shri. P.K. Chattopadhyay.



FOR THE PETITIONER / APPELLANT : Shri. S.L. Biswas (Advocate)

FOR THE RESPONDENT / O.P.S. : Shri S. Sen and Shri M . Ghosh , Shri S. Dhar and Shri P. Banerjee (Advocates)








Shri A.K. Ray., Member,



The Dist Forum, Murshidabad in its order dated 7.9.07 passed in case no 132 of 2006 allowed the complaint on contest against OP Nos 1 & 3 and exparte against OP No –2 without any costs. OP No 1, branch manager, Bank of Boroda , Kharsa branch, PO- Kharsa, Murshidabad was directed to credit a sum of Rs. 1,50,000/- towards balance of subsidy in the name of the petitioner within a period of 2 months from the date of the order in default interest @ 9 % p.a was allowed.



2. Being aggrieved by the aforesaid order the Appellant has filed the instant appeal. The Respondent no 1 herein had filed a complaint being no 132 of 2006 before the Forum below alleging inter alia that he took loan from Respondent no 2/ OP-1 Bank for manufacturing nails made of iron wires against a total project cost of Rs. 9,96,000/-. Respondent no –2 /OP No-1/ however financed Rs. 8,96,000/- against the margin money ( subsidy) of Rs. 2,49,000/-. Complainant was entitled to adjustment of the margin money ( subsidy) of Rs. 2,49,000/- as per order of the Director of Rural Employment Generation programme (REGP) scheme under Khadi and Village Industries Commission (KVIC) . In terms of undertaking of the above scheme the said margin money ( subsidy) of 25 % on project cost was required to be deposited inTDR for 2 years in the name and a/c of the loanee/ Complainant , with the Respondent no-2 /Op No 1 Bank.



3. As alleged , Respondent no –2/Op-1 Bank adjusted the sum of Rs. 99,000/- out of the total margin money (subsidy) of Rs. 2,49,000/-, but it did not however adjust the entire margin money which the Respondent no 1/ Complainant as beneficiary was entitled to. The Petitioner had already paid up the loan within 2 years . The OP – 1 thus violated the order of the directorate of REGP with the prayer for a direction upon the Respondent –2 bank to credit Rs. 1,50,000/- in the name of the Complainant with interest @ 18 % p.a.



4. OP No 3 contested the case by filing W.V denying all the material allegations of the Complainant . It contended amongst others that in the REGP scheme, the Complainant was sanctioned Rs. 9,96,000/- on 20.12.01 of which the term loan was Rs. 3,22,000/- and cash credit was Rs. 6,74,000/-. The margin money ( subsidy) would be released by the concerned bank in favour of the beneficiary to the financing bank and the said amount would be adjusted in the loan account of the beneficiary after 2 years of successful running of the unit in accordance with the norms of REGP scheme of KVIC.



5. The Complainant however, repaid the entire loan and closed the loan account on 1.11.2002 i.e within 1 year from the date of sanction. On scrutiny of the office record it was revealed that another unit of the same activity , i.e, nail manufacturing under the same working shed at the same address had been sanctioned by the Bank on 10.08/2002 in favour of one Sri Ashoke Kr Dutta, further of the Complainant and member of the same family. As per guidelines,benefit of REGP was not available to another member of the same family. Moreover , the Complainant did not produce any records of bill, voucher , book of account etc to show i.e production/ business ran successfully for more than 2 years as the Complainant had closed the account within one year another unit was sanctioned under the same shed for the same parties in the name of his father, a member of the family. So no margin money ( subsidy) could be released and as such the Complainant was not entitled to get the benefit of the margin money. Father of the Complainant also availed of the margin money amounting to Rs. 2,49,000/- for the business of the same nature under the same shed at the same address of the Complainant. The Complainant also did not adduce any evidence. OP –1/Bank of Boroda , Kharsa Branch, Mursidabad also contested the case by filing WV stating inter alia that the Complainant did not ask for the subsidy money from this OP nor he was refused by the OP that he would not disburse the loan . The Complainant never asked this OP No 1 earlier to disburse the subsidy amount. So this OP had no deficiency in service.

6. The Appellant further contended that in terms of circular no 11/ECR/KVIC/MM/211/97-98 dated 1/7-10-1997 of the REGPscheme the margin money could not be withdrawn before expiry of the term of 2 years as per clauses 5 & 6 of the said circular. The Forum below while allowing the complaint failed to consider that as per terms of the circular /guidelines of the KVIC, the benefit under the REGP scheme could be extended to only one member of family. As the father of the Respondent no-1/Complainant ,Sri Ashok Kr Dutta had already obtained such finance Assistance from the bank on the self same nature of unit of business under the REGP scheme, Respondent no-1/ Complainant being the son of the said Ashok Kr Dutta, living in the same family and carrying on the self same nature of business, was not entitled to get any benefit under the above scheme. The Forum below further failed to consider that the Respondent no –1 /Complainant did not come within the purview of the circular / order /rules of the REGP Scheme of KVIC in respect of adjustment of margin money against his loan account with the Respondent no 2/OP-1 Bank. The Respondent no 1/ Complainant having closed the unit of manufacture of nails before expiry of 2 years ceased to be a “consumer” under the C.P Act, 1986.



7. In his written argument, the Respondent no 1 stated amongst others that the Appellant proposed to contribute Rs. 2,49,000/- as margin money as per their rules and the said amount was deposited in the FDR Account in the name of Respondent no –1, but it was not released in his favour after 2 years as per proposal of the said scheme. He opened a cash credit account being no 36 with Bank of Boroda ,Kharsa Branch to run the business and he utilized the entire loan amount as it was available to him and in view of good running of his business ,he closed his cash credit account, i.e he refunded his entire loan amount to the bank as he has been running his business as yet and also maintaining a current account with Respondent no –2. He has paid necessary taxes for his nail manufacturing business and such payment of tax would proof that he has been running his business of nail manufacturing in the same place. Closing of a bank account after repayment of entire loan amount would not proof that he had closed his business. There was no such bar in the scheme in question to re-pay the entire loan amount within a period of 1 year. Sri Ashok Kr Dutta , his father got sanction of subsidy after starting his business. Sri Ashok Kr Dutta started his nail manufacturing business after the date of starting of the same business by Respondent no 1. The Appellant sanctioned and released the subsidy but never asked the question about being members of the same family. As the Appellant sanctioned the project of Ashok Kr Dutta after sanction of project of the Respondent no 1 , the Appellant was therefore duty bound to release the subsidy to Respondent no 1. There was no bar to run two separate businesses in a single shed.



8. We have heard the contesting parties to this case at length and have perused the memo of appeal along with the impugned order of the Forum below. Respondent no 3 never appeared before us to contest this case. Admittedly, Respondent no 1 got adjustment of Rs. 99,000/- as margin money out of total margin money of Rs. 2,49,000/-; further he ( Complainant ) within 1 year closed his loan account without crediting the aforesaid margin money in borrowers/ loan account. It was violation of clauses 5 & 6 of KVIC circular no 11/ECR/ KVIC /MM/211/97-98 dated 1/7-10-1997. This was not considered by the Forum below. Moreover, as per terms of the circular/ guidelines of the KVIC the benefit under the REGP scheme could be extended to only one member of a family. But the father of the Respondent no 1/ Complainant also obtained such financial Assistance from the bank on the self same nature of unit of business under the REGP scheme. Respondent no 1 being the son of the said Sri Ashok Kr Dutta , living in the same family and carrying on the self same nature of business was not entitled to get any benefit under the above scheme. The Respondent no 1 was not therefore entitled to any further release of subsidy kept with the financing bank. The Forum below mis-directed itself in passing its order in question without going through the relevant circular / guidelines of KVIC. The appeal therefore succeeds.



9. It is accordingly ordered that the appeal be allowed on contest against Respondent nos 1 & 2 and exparte against Respondent no 3. The impugned order of the Forum below be set aside. LCR be returned with a copy of this order.