CC No.1584.2015

Filed on 04.09.2015

Disposed on.19.03.2018

BEFORE THE III ADDITIONAL BANGALORE URBAN DISTRICT

CONSUMER DISPUTES REDRESSAL FORUM,

BENGALURU– 560 027.

DATED THIS THE 19^th DAY OF MARCH 2018

CONSUMER COMPLAINT NO.1584/2015

PRESENT:

Sri.  H.S.RAMAKRISHNA B.Sc., LL.B.

        PRESIDENT

              Smt.L.MAMATHA, B.A., (Law), LL.B.

                     MEMBER

                                       V/S

ORDER

BY SRI.H.S.RAMAKRISHNA, PRESIDENT

1. This Complaint was filed by the Complainant on 04.09.2015 U/s 12 of the Consumer Protection Act, 1986 and praying to pass an Order directing the Opposite Parties to pay compensation of Rs.10,00,000/- towards loss & damage caused to the Complainant and other reliefs. 
2. The brief facts of the complaint can be stated as under:

In the Complaint, the Complainant alleges that the Complainant is a permanent resident of Kerala having his native place at Kanattil House, Kottanellore Post, Trichur District, Kerala State and his business interest in Bangalore where he is residing presently in a rented house.  It is the cherished dream of the Complainant to own a residential property of his own in his native place.  In pursuance of the said dream, the Complainant identified a property at his native place to purchase the same by availing financial facility from Bank.  In this context, the Complainant negotiated with the Vendor of a property for an agreed sale consideration.  Under the said agreement the Complainant had paid a sum of Rs.10 Lakhs towards part sale consideration further agreeing to pay the balance at the time of registration of the sale deed by obtaining a loan sanctioned from the Bank.  In this context, the Complainant approached Central Bank of India, seeking a housing term loan and submitted requisite papers for preliminary verification such as Credit Information Report from the 1^st Opposite Party.  The 1^st Opposite Party herein is a Company incorporated under the Companies Act and engaged in the business of collecting Credit Information on behalf of various Banks and financial institutions and providing credit reports to such banks and financial institutions.  The 1^st Opposite Party represent that for the purpose of its members i.e., banks & financial institutions, a furnish with credit information on their customers and borrowers as required under the Credit Information Companies Act, 205 & the Rules & Regulations made thereunder.   The 1^st Opposite Party represented that for the purpose of its members they furnish with Credit Information on their customers & borrowers has required under the CICR Act, Rules & Regulations.  The said Credit Information is the credit history of previous & current borrowings/credits availed by both individuals & entities and this information is applicable to all loan products, credit card and he submitted to a Credit Information Companies by its member Credit Institutions as mandated under the Act.  In pursuance of the approached made by the Complainant, Central Bank of India sought for Credit Information Report of the Complainant from the 1^st Opposite Party.  Here the Credit Information Report furnished by the 1^st Opposite Party dt.18.03.2013 & 02.01.2014 with a CBIL Transmission Score of 488 is full of discrepancies attributing various outstanding to several financial institutions against the name of the Complainant which in fact is not true and the Complainant has nothing to do with the outstanding shown in the report.  It is not known on what basis or information the aforesaid report is furnished by the 1^st Opposite Party which in fact has caused great damage to the credit worthiness of the Complainant which cannot be compensated.  The Report submitted by the 1^st Opposite Party has seriously put the credibility, accuracy & reliability of the 1^st Opposite Party to test as the 1^st Opposite Party has emphasized that they are a trusted leader in the Credit Information Industry & takes accuracy very seriously ad committed to provide complete and reliable credit information.  The list of names of the banks & financial institutions furnished by the 1^st Opposite Party in its report starting from Central Bank to Centurian Bank is baffling and obviously the financial institution to whom the report was submitted draw an adverse inference on the credit worthiness of the Complainant and consequently the proposal submitted by the Complainant was turned down for the sole reason of the erroneous report submitted by the 1^st Opposite Party. The Complainant herein had prolonged correspondence with the 1^st Opposite Party where under the 1^st Opposite Party was requested to rectify the error by removing the entries in the report submitted which is not pertaining to him and to furnish a rectified report so as to enable the financial institutions to process the loan application submitted.  In this context, the Complainant had issued a notice dt.09.04.2014 through his counsel and the said notice was duly served on the 1^st Opposite Party.  In response to the notice, the 1^st Opposite Party sought certain clarifications vide their letter dt.16.04.2014 which was duly complied by the Complainant vide reply letter dt.17.06.2014.  Despite of receipt of the said clarification the 1^st Opposite Party failed and neglected to furnish rectified report with accurate entries.  In pursuance of the said correspondence regularly, however the 1^st Opposite Party failed & neglected to identify the mistake committed by them in furnishing wrong information to the financial institutions which in fact has caused immense damage to the financial reputation of the Complainant.  Even after prolonged correspondence, the 1^st Opposite Party continued to furnish false information with regard to the Credit Information of the Complainant herein.  The Complainant has submitted an application to the Citi Bank, M.G.Road Branch, Bangalore, where he is maintaining his account, for credit card facility.  While processing the application the Manager-Customer Service of Citi Bank sought for credit information report from the 1^st Opposite Party and to the shock & surprise of the Complainant, the 1^st Opposite Party once again furnished false report thereby the application filed by the Complainant seeking credit card facility was rejected by the 2^nd Opposite Party vide its letter dt.11.12.2014.  Even after prolonged corresponding, the 1^st Opposite Party yet again furnishing an erroneous credit information report dt.20.12.2014 to Citi Bank and consequently the application submitted by the Complainant for credit card came to be rejected.  The Complainant is not a defaulter to any of the financial institutions referred to in report submitted by the 1^st Opposite Party and this clearly shows that negligence on the part of the 1^st Opposite Party.  Due to the aforesaid negligence & inefficiency on the part of the 1^st Opposite Party in furnishing inaccurate reports, the banks to whom approached by the Complainant for financial assistance have turned down the proposal causing huge monetary loss in the form of forfeiture of the advance amount paid to the Vendor of the property with whom the Complainant had negotiated to purchase the same.  Besides it has caused great damage to the creditworthiness of the Complainant in the financial market which cannot be compensated in terms of money.  Even though the 1^st Opposite Party has admitted its mistake during the course of one of the mail exchanges promising to remove the irregularities crept in the report submitted, the discrepancy continued to be reflected in the report subsequently furnished which clearly shows that the 1^st Opposite Party has failed to update the report despite the promise made.  Thus the 1^st Opposite Party has committed grave error of deficiency and negligence.  Therefore the 1^st Opposite Party is liable to compensate the Complainant by way of damage.    Hence this complaint.

3. In response to the notice, the Opposite Party No.1 & 2 put their appearance through their counsel and filed their separate version.  The Opposite Party No.1 in their version pleaded that the complaint is not maintainable against the 1^st Opposite Party, as there is no privity of contract between the Complainant and this 1^st Opposite Party.  The complaint is not maintainable on the ground that the Complainant is not a “Consumer” of this 1^st Opposite Party under the Consumer Protection Act, 1986 as neither the Complainant has availed any services for consideration from this 1^st Opposite Party nor has this 1^st Opposite Party provided any service to the Complainant for a consideration.  This position is apparent from the plain reading of the complaint, wherein the Complainant has only submitted to have approached various financial credit institutions/banks for availing certain credit facilities but no averment as to the relationship of the Complainant with the 1^st Opposite Party has been made.  Hence even by the express admission of the Complainant, he is not a ‘Consumer’ of this 1^st Opposite Party.   The 1^st Opposite Party does not carry on business or have a branch office, or personally work for gain at Bangalore, nor any cause of action, as alleged or otherwise, has arisen against this 1^st Opposite Party within the territorial Jurisdiction of this Hon’ble Forum.  Even the Complainant has not made any averment whatsoever in his complaint as regards the 1^st Opposite Party being within the territorial Jurisdiction of this Hon’ble Forum.  The Complainant has also failed to obtain leave from this Hon’ble Forum as envisaged under Section 11(2)(b) of the Consumer Protection Act, 1986.  Hence the Consumer complaint is not maintainable against this 1^st Opposite Party and has to be dismissed on this ground alone.  In terms of Section 31 of the CICRA no court or authority shall have or be entitled to exercise any Jurisdiction, powers or authority except the Supreme Court or the High Court exercising Jurisdiction under Articles 32, 226 and 227 of the Constitution in relation to the matters referred to in the said section. The Complainant was through several communications made aware about the role and function of the 1^st Opposite Party as a credit information company, yet he has impleaded 1^st Opposite Party.  The 1^st Opposite Party is a Company incorporated under the provisions of the Companies Act, 1956 having its registered office at Hoechst House, 6^th Floor, 193, Backbay Reclamation, Nariman Point, Mumbai-400021, and is engaged in the business of storing, retrieving, compiling, collating, processing and maintaining a data of credit information relating to both individuals and entitles of all types whether incorporated or not, for the use of banks, financial institutions, etc. dealing with the distribution of credit.  The 1^st Opposite Party functions as a credit information company in accordance with the provisions of the Credit Information Companies (Regulation) Act, 2005 read with the Credit Information Companies Rules, 2006 and the Credit Information Companies Regulations, 2006 made under CICRA.  Any pending dispute of the Complainant with the 1^st Opposite Party, it is submitted that in terms of section 18 of the CICRA, notwithstanding anything contained in any law for the time being in force, any dispute on matters relating to the business of credit information is required to the settled solely by conciliation or arbitration under the Arbitration and Conciliation Act, 1996.  The Complainant is aware and has admitted being aware of that the 1^st Opposite Party only acts as a repository of credit information.  The creation of credit information companies like the 1^st Opposite Party and mandatory submission of credit information to such credit information companies by their member banks and financial institutions, being a requirement of statute, no further consent of any person or entity is required in this regard.  Credit information is the credit history of previous and current borrowing credit availed by both individual and entities like partnership firms, proprietary concerns, private and public limited companies, etc.  This information is applicable on all loan products, credit cards, etc.   The CICRA allows the creation of credit information companies which will enable banks to readily access the full credit history of any borrower.  The 1^st Opposite Party helps the credit grantors to access the complete history of the credit applicant’s credit record spread over different institutions.  The CIR merely reflects the information submitted to the 1^st Opposite Party by is member credit institutions as required under the CICRA, the Rules & the Regulations.  This information is submitted by the member credit institutions periodically in a prescribed format and through an automated process-whereby the information directly gets fed into the CIBIL database of the relevant individual.  The credit information appearing in the credit information report furnished by the 1^st Opposite Party is the aggregate of the information submitted to it by its members.  The 1^st Opposite Party issues the Credit Information Report (CIR) in as standard format and it does not create information or provide inputs thereon of its own.  On receipt of the grievance from the Complainant, the 1^st Opposite Party verified the details of the CIR of the Complainant and based on the data submitted to 1^st Opposite Party and the match rules, it was observed that the CIR generated for the Complainant had some credit information details pertaining to another individual due to similarity in the identifying details as submitted by a credit institution.   This is due to the system of generating CIR which works on the match on name, date of birth, address, gender and identifiers like PAN Number Passport number Voter ID No, Driver’s License number or phone number.  When these identifiers are fed into the system a CIR on the best possible match with the date available in the system is generated.  However at times, several pieces of information regarding a person or entity may be so common with that of another person/entity that the date of the two persons/entities gets merged.  That such merger is neither intentional nor due to negligence, and occurs despite adoption of the best market practices.  To rectify such errors, the 1^st Opposite Party itself advises all applicants for CIR to bring to its notice any discrepancies in their CIR so that the same could be re-looked and, if need be, rectified.  Immediately on receipt of Complainant’s request, the 1^st Opposite Party also took up the issue with the relevant credit institution to verify the identification details submitted by the credit institution and accordingly upon being satisfied that the error was due to discrepancy in one of the identifiers submitted by a credit institution, rectified the error in Complainant’s credit information and informed the Complainant of the same vide its several emails including email dt.June 4, 2013 and further confirmed by its email dt.December 20, 2013. The discrepancy in the CIR of the Complainant was neither intentional nor an act of negligence but on account of the circumstances mentioned.  Immediately on receipt of information regarding the grievances, the 1^st Opposite Party has taken immediate steps to rectify the error and had kept the Complainant advised of the corrections made. The 1^st Opposite Party is not responsible for verifying the accuracy, completeness and veracity of any information reported by the member credit institutions.   Such responsibility lies with the reporting institutions as per the CICRA and the Rules and the Regulations made thereunder. When information/data, as required under the CICRA, is submitted by a member credit institution, the 1^st Opposite Party has no reason to believe that any information therein is incorrect and is duty bound to reflect the same as received by its in its CIRs.  In this regard, it is pertinent to note that any rectification in the data base of credit information or change in the credit information can only be made in accordance with the provisions of the CICRA.  Thus the 1^st Opposite Party has no unilateral right to carry out any correction, deletion or modification in the credit information of any person unless such correction etc has been certified as correct by the concerned credit institution. Any act or deed by the 1^st Opposite Party contrary to the said position would render it liable for penal action by the RBI under the CICRA, and the Rules and the Regulations made thereunder.   In terms of section 30 of CICRA, no suit or other legal proceedings can lie against, inter-alia, the 1^st Opposite Party for anything done by it in good faith or in pursuance of the said Act or any other law for the time being in force.  Hence it is submitted that no cause of action arises against the 1^st Opposite Party and the complaint has filed is barred under the express provisions of Section 30(1) of CICRA protecting.  On receipt of the instant complaint, in terms of the provisions of CICRA, the 1^st Opposite Party investigated the matter and found that the query of the Complainant was resolved in the Year 2013 itself.  As explained earlier that the information submission by various member credit institution is a system driven process and as and when the information is sent by a credit institution, it gets automatically updated in the respective CIBIL record of an individual/entity.  However, despite having taken necessary steps and rectifications by 1^st Opposite Party, every time a credit institution submitted the information with errors, the same erroneous data got updated in the records nullifying the changes made each time by the 1^st Opposite Party pursuant to the grievance raised by the Complainant.   The 1^st Opposite Party states that immediately after rectifications were made and before the next cycle of information submission occurred, one of its members had accessed the CIR of the Complainant.  This CIR reflects the changes carried out by 1^st Opposite Party and also denied all the averments made in the complaint and prays to dismiss the complaint.

4.   The Opposite Party No.2 in their version pleaded that the complaint is false and baseless.  The complaint is neither maintainable in law nor on facts.  The Complainant is having a Savings Account Bearing No.5116104816 which is a Salary Account.  The Complainant had applied for the credit card vide application ref No.14121184429.  The Opposite Party after receiving the application had checked from the Credit Information Bureau India Limited (CIBIL) i.e., Opposite Party No.1 for the card approval.   As per the process of the 2^nd Opposite Party Bank, if the customer applies for the credit product, the Complainant’s CIBIL records will be verified before approval.  Based on the Credit Information Report (CIR), the Bank reserves right to process/reject a credit card application.  After verifying the Credit Information Report (CIR) from the CIBIL, the Complainant’s Credit card application was rejected with the internal reason code-RK CIBIL-Applicant has suit filed i.e., “the customer may have some written offs or unpaid dues across his liability products in the market”. With reference to the allegations are against the Opposite Party No.1 and not against this Opposite Party No.2 and do to require response of the Opposite Party No.2.  The Opposite Party NO.2 had informed the Complainant vide mail on 11.12.2014, that the Opposite Party No.2 was unable to approve the Complainant’s application since the feedback from the CIBIL does not meet the minimum credit criteria of Opposite Party No.2.   The Opposite Party No.2 written a letter on 20.12.2014 informing the Complainant to get in touch with the Member Bank/CIBIL for clarification.  The Opposite Party No.2 has acted prudently and diligently and have strictly adhered to and followed the Banking norms and various guidelines issued by the RBI.   There is no cause of action has arisen for the Complainant to file the present complaint.  The Complainant has not claimed any deficiency of service against the Opposite Party No.2.  Hence, the complaint against Opposite Party No.2 is liable to be dismissed.

5. The Complainant, Mr.Anoop K.Raghupathy filed her affidavit by way of evidence and closed her side.  The Opposite Party No.1, Sri.Satish Pillai has filed his affidavit by way of evidence.  The Opposite Party No.2, Sri.Nandish Prabhakar has filed his affidavit by way of evidence.  Heard the arguments of both parties.

6.      The points that arise for consideration are:-

1. Whether the Complainant is a ‘Consumer’ as defined under Section 2(1)(d)(ii) of the Consumer Protection Act, 1986 ?
2. Whether the Complainant has proved the alleged deficiency in service by the Opposite Parties ?
3. If so, to what relief the Complainant is entitled ?

7.     Our findings on the above points are:-

                POINT (1):-  Negative

POINT (2):-  Will not survive for consideration

                POINT (3):-  As per the final Order

REASONS

8. POINT NO.1:- The learned Counsel for the Complainant argued that the main contention raised by the 1^st Opposite Party that the Complainant is not a ‘Consumer’ and there is no privity of contract between the Complainant and the 1^st Opposite Party under the Consumer Protection Act, 1986 and neither the Complainant has availed any services for consideration from the 1^st Opposite Party nor has the 1^st Opposite Party provided any services to the Complainant for a consideration is not correct.   In fact the Complainant is a ‘Consumer’ within the definition of Section 2(1)(d)(ii) of the Consumer Protection Act, 1986 which reads as follows:

Under Section 2(1)(d)(ii) of the Consumer Protection Act, 1986, a consumer is not only the person who hires or avails of any service for consideration but also the person who is the beneficiary of such services.  “The Complainant herein is a beneficiary who have relied upon the CIR report submitted by the 1^st Opposite Party and more so has paid the prescribed fees and therefore a consumer within the meaning of Section 2(1)(d)(ii) of the Consumer Protection Act, 1986.

9. In support of his argument, he relied upon a decision reported in Narain Steel Traders V/s Central Bank of India & Others (Consumer Protection Judgements 1995(III)CPJ495).   On the other hand, the learned Counsel for the Opposite Party No.1 argued that the Complaint is not maintainable.  On the ground that the Complainant is not a ‘Consumer’ of Opposite Party No.1 under the Consumer Protection Act, 1986 and neither the Complainant has availed any services for consideration from the 1^st Opposite Party nor has the 1^st Opposite Party provided any services to the Complainant and there is no privity of contract between the Complainant and the 1^st Opposite Party.  Hence, the Complainant is not a ‘Consumer’ as defined under Section 2(1)(d)(ii).

10. With this argument and on perusal of record, the Complainant filed this complaint against Opposite Party No.1 Credit Information Bureau (India) Limited and Manager, Citi Bank and the prayer of the Complainant is to rectify the error in the Credit Information Report pertaining to Complainant furnished to the financial institutions and to pay sum of Rs.10,00,000/- as compensation towards loss and damages caused to the Complainant in the financial market and for deficiency of service and negligence committed by the 1^st Opposite Party and further it is also very clear that the prayer is only against 1^st Opposite Party, but not against Opposite Party No.2.  Even as looking into the allegations made in the complaint, there is no allegation against Opposite Party No.2.  The allegation is only against Opposite Party No.1 prayer is only against Opposite Party No.1 and also it is clear allegations in the complaint.  When the Complainant approached Central Bank of India sought for Credit Information Report of the Complainant from the 1^st Opposite Party.  Here the Credit Information Report submitted by the 1^st Opposite Party dt.18.03.2013 & 02.01.2014 with a CBIL Transmission Score of 488 is full of discrepancies.   By looking into these allegations and averments made in the complaint, the Complainant availed the service of the Opposite Party No.2 but not Opposite Party No.1 and even they have not paid any consideration to the Opposite Party No.1 whereas section 2(1)(d)(ii) any service for consideration which has been paid or promised or partly paid and partly prom­ised,  but here the Complainant has not placed any evidence to show that he has paid the consideration to the Opposite Party No.2.  Further even as law laid down in Narain Steel Traders V/s Central Bank of India & Others (Consumer Protection Judgements 1995(III) CPJ495).  It is clear that a ‘Consumer’ is not only the person who hires or avails of any services for consideration but also any beneficiary of such services, provided that he is availing the services with the approval of the hirer.  But in this case, the law laid down in the decision is not applicable.  Since the Complainant has not placed any evidence to show that with the approval of the Opposite Party No.2, the Complainant engaged the service of the Opposite Party No.1.  Therefore, the law laid down in the decision is not applicable to the facts of this case.  Hence, it is not proper to accept the argument of the learned Counsel for the Complainant that the Complainant is a ‘Consumer’ as defined under Section 2(1)(d)(ii) of the Act.   As rightly argued by the learned Counsel for the Opposite Party No.1 the Complainant is not a ‘Consumer’ as defined under Section 2(1)(d)(ii) of the Act.  Hence, this point is held in Negative.  

11.  POINT NO.2:- In view of our findings on point No.1 is held in Negative.  In question of considering the point No.2 will not survive. Hence, we answer point No.2 will not survive for consideration.

12. POINT NO.3:-  In the result, for the foregoing reasons, we proceed to pass the following order:

ORDER

The Complaint is dismissed.  No cost.

Supply free copy of this order to both the parties. 

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Open Forum on this, 19^th day of March 2018).

        MEMBER                                             PRESIDENT

LIST OF WITNESSES AND DOCUMENTS

 Witness examined on behalf of the Complainant:

1. Mr.Anoop K.Raghupathy, who being the Complainant has filed his affidavit.

 List of documents filed by the Complainant:

1. Copy of the Credit Information Report dt.18.03.2013 submitted by the 1^st Opposite Party.
2. Copy of the Credit Information Report dt.02.01.2014 submitted by the 1^st Opposite Party.
3. Notice dt.09.04.2014 issued by the Complainant.
4. Letter dt.16.04.2014 issued by the 1^st Opposite Party.
5. Reply dt.17.06.2014 issued by the Complainant.
6. Copies of the e-mail correspondences.
7. Copy of the Credit Information Report submitted by the 1^st Opposite Party.
8. Copy of the letter dt.11.12.2014 issued by the 2^nd Opposite Party.

Witness examined on behalf of the Opposite Parties:

1. Sri.Satish Pillai, Managing Director & CEO of Opposite Party No.1 by way of affidavit.
2. Sri.Nandish Prabhakar, Manager of Opposite Party No.2 by way of affidavit.

List of documents filed by the Opposite Party:

1. Gmail correspondences
2.  

    MEMBER                                                                         PRESIDENT