STATE CONSUMER DISPUTES REDRESSAL COMMISSION,

U.T., CHANDIGARH

1]    India Bulls Financial Services Limited, through its Managing Director, SCO No.337-338, Sector 35-B, Chandigarh.

2]    The Managing Director, India Bulls Financial Services Limited, SCO No.337-338, Sector 35-B, Chandigarh.

……Appellants/Opposite Parties No.1 and 2.

V e r s u s

1. Unison Drugs Private Limited, through V.K.Uppal, Managing Director, 791, Industrial Area, Phase-II, Chandigarh. (respondent no.1/complainant).

2. Credit Information Bureau (India) Limited, Hoechst House, 6th Floor, 193, Backbay Reclaimation, Nariman Point, Mumbai 400021 (respondent no.2/Opposite Party No.3).

              ....Respondents

Appeal under Section 15 of the Consumer Protection Act, 1986.

BEFORE:   JUSTICE SHAM SUNDER (RETD.), PRESIDENT.

                MRS. NEENA SANDHU, MEMBER.

Argued by: Sh. Sandeep Suri, Advocate for the appellants.

                   Sh. Arun Kumar, Advocate for respondent no.1.

                   Sh. Animesh Sharma, Advocate for respondent no.2.

PER JUSTICE SHAM SUNDER (RETD.), PRESIDENT

              This appeal is directed against the order dated 28.09.2012, rendered by the District Consumer Disputes Redressal Forum-I, U.T., Chandigarh (hereinafter to be called as the District Forum only), vide which, it accepted the complaint, filed by the complainant (now respondent no.1) and directed Opposite Parties No.1 and 2 (now appellants) as under:-

“Henceforth, keeping in view the foregoing discussion, findings and entirety of the case, we are of the considered opinion that the deficiency in service as well as indulgence into unfair trade practice, is writ large & apparent on the part of OPs No.1 & 2.  Therefore, the present complaint, having lot of merit, weight and substance, must succeed.  The same is accordingly allowed against OPs No.1 & 2.  The OPs No.1 & 2 are directed to pay Rs.50,000/- as compensation to the complainant for causing his harassment & mental agony, apart from paying litigation cost of Rs.15,000/-.

This order be complied with by the OPs No.1 & 2 within a period of 30 days from the date of receipt of copy of this order, failing which they shall be liable to pay interest on the compensation amount of Rs.50,000/- @ 12% p.a. from the date of filing the present complaint i.e. 06.09.2011 till its actual payment, besides paying litigation costs, as aforesaid”.

2.               The facts, in brief, are that the complainant is a reputed Private Limited Company  and has been running its business, in the market, for the last many years. According to the complainant Company, Mr. Sandeep, a representative of Opposite Parties No.1 and 2, approached Mr. V.K. Uppal, Managing Director of the same, in the second week of June 2008, and requested him, for taking business loan, on the following terms and conditions:-

(i)       interest @19% reducing

(ii)     1% processing charges

(iii)    Total amount of Rs.20 lacs.

3.               The Managing Director of the complainant Company, considered the request of Mr. Sandeep and agreed to take loan, on the above said terms and conditions. The complainant Company was surprised to receive the letter dated 10.07.2008, which was issued by Opposite Parties No.1 and 2, in which it was mentioned that the loan  of Rs.15.00 lacs, was sanctioned against loan account no.LIFSCHG00039577, out of which, an amount of Rs.33,708/- was charged towards processing fees (inclusive of service tax), Rs.781/- towards Pre-EMI, and also, an amount of Rs.20,000/- towards insurance from Max New York Life Insurance Company Limited. In all an amount of Rs.14,45,511/- was disbursed to the complainant, vide cheque no.007794 dated 30.06.2008.

4.               It was stated that, on receipt of the letter dated 10.07.2008, the Managing Director of the complainant wrote a letter dated 17.07.2008, to Opposite Parties No.1 and 2, stating therein, that it (Company), refused to take the loan, as the same was not sanctioned, as per the commitment, made by their representative. It was also intimated to Opposite Parties No.1 and 2, vide the aforesaid letter that the amount of Rs.20,000/-, was  deducted by them, towards insurance, without the consent of the complainant. The complainant Company, thus, requested Opposite Parties No.1 and 2, to settle its claim, on or before 28.7.2008, otherwise, it would be forced to stop payment of first installment of loan, which was due on 01.08.2008. After the receipt of letter dated 17.07.2008, Opposite Parties No.1 and 2, assured the complainant Company, to settle the matter amicably. On the assurance of Opposite Parties No.1 and 2, the complainant Company, cleared two installments of  loan. Again, no action, whatsoever, was taken by Opposite Parties No.1 and 2. Thus, the complainant Company, again wrote letter dated 15.09.2008, to Opposite Parties No.1 and 2, and requested them, to settle the matter, by 25.09.2008. The complainant Company also intimated Opposite Parties No.1 and 2, that it would stop payment of third installment of loan, in case, they failed to settle the matter, amicably.

5.               It was further stated that Opposite Parties No.1 and 2, failed to honour their commitment. Thus, the complainant Company, left with no other alternative, gave instructions, to its bank,  to stop payment of installments, from 1.9.2009 to 01.07.2012, and also gave intimation to Opposite Parties No.1 and 2, in that regard. It was further stated that, thereafter, the complainant Company, in order to close its loan account, wrote letter dated 29.07.2009, to Opposite Parties No.1 and 2.  Opposite Parties No.1 and 2, were also requested vide letter dated 29.07.2009, for giving the detail, with regard to its total pending balance upto 31.07.2009, but they failed to supply the same. The complainant Company,  again wrote letters to Opposite Parties No.1 and 2, requesting them to convey the exact amount, immediately, as the demand draft of Rs.12 lacs, was ready with it, for closing the account. After the receipt of letter dated 24.08.2009, from the complainant Company, Opposite Parties No.1 and 2, informed the complainant vide letter dated 26.09.2009, that Rs.12,17,030/-, were required to be paid by it, to them, towards full and final settlement of the claim. The amount was accordingly paid by the complainant.

6.               It was further stated that in March, 2011, the complainant applied for a loan, in ICICI Bank Limited, for the Staff Bus, but the same was rejected, on the ground, that its name figured, in the defaulter list of CIBIL (Credit Information Bureau (India) Limited). It was further stated that, later on, the complainant Company, came to know that its name was intentionally and deliberately, given by Opposite Parties No.1 and 2, to CIBIL (Credit Information Bureau (India) Limited), and its status  was shown as “settled”, in CIBIL  Consumer Credit Information Report dated 08.06.2011.

7.               It was further stated that since, Opposite Parties No.1 and 2, intentionally and deliberately, gave the name of the complainant Company,  in CIBIL (Credit Information Bureau (India) Limited), even after the clearance of its loan account, it amounted to deficiency, in rendering service and indulgence into unfair trade practice. It was further stated that, on account of this reason, the complainant Company suffered huge loss. Legal notice dated 22.06.2011, was also served upon Opposite Parties No.1 and 2, to settle the grievance of the complainant, but to no avail. When the grievance of the complainant, was not redressed, left with no alternative, a complaint under Section 12 of the Consumer Protection Act, 1986 (hereinafter to be called as the Act only), was filed, directing  Opposite Parties No.1 and 2, to get removed the name of the complainant Company, from the defaulters list of CIBIL (Credit Information Bureau (India) Limited); pay compensation, in the sum of Rs.5 lacs, alongwith interest @24% P.A., on account of mental torture, harassment, damage to reputation, defamation, lowering down its reputation and image in the market; and cost of litigation, to the tune of Rs.25,000/-.

8.               Opposite Parties No.1 and 2, in their joint written version, pleaded that since the complaint, had been filed by the commercial organization,  which had availed of the loan for business purposes, it did not fall within the definition of a consumer, and, as such the Consumer Complaint was not maintainable. It was stated that the loan was disbursed to the complainant Company, on the basis of the agreement executed between the parties. It was further stated that the amount of interest and other charges was charged, by the complainant, as per the agreement.  It was further stated that the complainant Company was contacted, on receipt of letter dated 24.8.2009, and lower amount was offered on the basis of one time settlement.   The complainant Company refused to pay the full amount, due  under the agreement. It was further stated that, hence a settlement was reached at a lower amount, than what was due against the complainant Company to Opposite Parties No.1 and 2. It was further stated that grant or non-grant of  loan, was the sole prerogative of Opposite Parties No.1 and 2.  It was further stated that the name of the complainant Company, in CIBIL, was not attributable to the settlement with the Bank, but, on account of various facilities availed of, by it earlier,  from time to time. It was further stated that  removal of the name  of the complainant was never a part of the settlement and it could not be done by Opposite Parties No.1 and 2. It was further stated that neither there was any deficiency, in rendering service, on the part of Opposite Parties No.1 and 2, nor they indulged into unfair trade practice. The remaining averments, were denied, being wrong.

9.               Opposite Party No.3, in its written version, stated that the data reflected in its Credit Information Report, was provided by the Member Credit Institutions. It was further stated that, it was the responsibility of Credit Institutions, to submit updated, accurate and complete information to it.  It was further stated that, in this case, India Bulls Financial Services Limited, had submitted the data and confirmed the report credit information, on the basis of  which it  acted.  It was further stated that it could not modify any data, in its database, without concerned Credit Institution(s), sending the updated records. It was further stated that the Credit Institutions needed to send the instructions, with updated records, for uploading the same, into the data base. It was further stated that neither there was any deficiency, in rendering service, on the part of Opposite Party No.3, nor it indulged into unfair trade practice. The remaining averments, were denied, being wrong.

10.            The Parties led evidence, in support of their case.

11.            After hearing the Counsel for the parties, and, on going through the evidence, and record of the case, the District Forum, accepted the complaint, in the manner, referred to, in the opening para of the instant order. 

12.            Feeling aggrieved, the instant appeal, has been filed by the appellants/ Opposite Parties No.1 and 2.

13.            We have heard the Counsel for the parties, and have gone through the evidence, and record of the case, carefully.

14.            The first question, that arises for consideration, is, as to whether, the complainant Company fell within the definition of a ‘consumer’ or not ?   No doubt, this question was neither touched, nor discussed nor decided by the District Forum, though a specific objection, was taken in the written version, by Opposite Parties No.1 and 2, in that regard. It is, however, the settled principle of law, that  the Consumer Foras, at any stage of the proceedings, are duty bound to decide of their own, the legal questions, as to whether, the complainant fell within the definition of a consumer; whether they (Foras) had territorial and pecuniary jurisdiction to entertain and decide the complaint  ; whether the complaint involved the consumer dispute; and whether the consumer complaint was maintainable. From the bare allegations, contained in the complaint, it is evident, that the  complainant is a Private Limited Company of repute and has been  running its business, for the last many years, in the market. It is further evident, from the allegations, contained in the complaint, that the complainant was approached   by Mr. Sandeep, a representative of Opposite Parties No.1 and 2, for taking the business loan, on certain terms and conditions. It means, that the loan was obtained  by the complainant Company, for business i.e. for commercial purpose. The complainant Company utilized the loan amount, which was advanced, in its favour, for commercial purpose, i.e. for its business. In the entire complaint, the complainant did not make even a fleeting  reference that it got the said loan facility, for running its business, for earning its livelihood, by way of self employment. For proper decision of this question, the provisions of Section 2(1)(d) and Section 2(I)(o), defining the ‘consumer’ and ‘service’ respectively are extracted, as under ;

 “(d) "Consumer" means any person who, -

(i) buys any goods for a consideration which has been paid or promised or 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 for 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 then 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 a person who avails of such services for any commercial purpose]; Added by Act 62 of 2002 w.e.f. 15.03.2003.

[Explanation. For the purposes of this sub-clause "commercial purpose" does not include use by a consumer of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood, by means of self-employment;]

Section 2(1)(o) defines service as under:-

(o) "service" means service of any description which is made available to potential 16[users and includes, but not limited to, the provision of] facilities in connection with banking, Financing insurance, transport, processing, supply of electrical or other energy, board or lodging or both, 17[housing construction] entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service.”

13.         According to Section 2(1)(d)(i) of the Act, the consumer does not include a person who obtains such goods for resale or for any commercial purpose. Section 2(1)(d)(ii), which was amended by Act 62 of 2002 w.e.f. 15.03.2003, clearly lays down that the person who hires or avails of the services for  consideration, for any commercial purpose, shall not qualify, as a consumer.

15.            In the instant case, respondent no.1/complainant, which is a Private Limited Company, availed of the services, of appellants/Opposite Parties No.1 and 2, by obtaining loan, in the sum of Rs.15,00,000/-. In other words, it took the loan facility, for furthering its business, to generate huge profits, and, as such, it did not fall within the definition of a consumer. In  Economic Transport Organization Vs.Charan Spinning Mills (P) Ltd., & Anr., I (2010) CPJ 4 (SC), a four Judge Bench, of the Hon’ble Apex Court, also held that, after the amendment of Section 2(d) of the Act w.e.f.15.03.2003, the services of the carriers, if had been availed of, for any commercial purpose, then the person availing of the same will not be a consumer.  In  Birla  Technologies Ltd. Vs Neutral Glass and Allied Industries Ltd.  2011 (I) SCC 525 and Sanjay D.Ghodawat Vs R.R.B. Energy Ltd. IV(2010) CPJ178(NC), a case decided by a full Bench of the Hon’ble National Commission, similar principle of law was laid down.  In Shushma Goel Vs Punjab National Bank 2011 Consumer Protection Judgments 270(NC), the complaint related to the operation of bank account, maintained by a commercial entity for commercial purpose.  It was held that the complainant did not fall within the definition of a consumer. Since, the services of Opposite Parties No.1 and 2/appellants, in the instant case, were availed of, by the complainant Company/respondent no.1, for commercial purpose for earning huge profits, it did not fall within the ambit of a consumer, and, as such, the complaint was not maintainable.

16.            The next question, that falls for consideration, is, as to whether, Opposite Parties No.1 and 2, sent a wrong information, to Opposite Party No.3, as a result whereof,   the status of the loan account of respondent no.1/complainant Company was shown in Credit Information Bureau (India) Limited as settled. It is evident, from the averments, contained in the written version of Opposite Parties No.1 and 2, that a settlement was arrived at, between the parties, as a result whereof, the complainant was asked to pay a sum of Rs.12,17,030/-, against the amount of Rs.12,98,842/-, due against it. It is further evident from  the written version, that even the complainant Company was given waivers of Rs.18,559/- and Rs.63,257/-. It was stated in the written version, that as per the settlement, at lower amount, which was arrived at, between the parties, the status of the loan account of the complainant was shown in the CIBIL Credit Consumer Credit Information Report as “settled”.  Once, a settlement was arrived at, between the parties and the account was shown as “settled”, in our considered opinion, it amounted to the   resolution of  dispute, for all times. Word settled means “resolved”. In the CIBIL Consumer Credit Information Report, at page 62 of the District Forum file, the status of the complainant Company, in respect of the loan, in question, was shown as “settled” The complainant Company was not shown as defaulter of Opposite Parties No.1 and 2. We fail to understand, as to how, by showing the status of loan of the complainant Company as “settled”, which was a fact, apparent on record, there was any deficiency, in rendering service, on the part of Opposite Parties No.1 and 2. Had, after the settlement, the complainant been shown as “defaulter”, or some amount would have been shown, due against it, in the CIBIL  Consumer Credit Information Report, the matter would have been different. Since, the word “settled” amounted to “resolved”, status of the loan account of the  complainant was correctly  reflected in the CIBIL  Consumer Credit Information Report. In the letter dated 26.09.2009, it was nowhere stated by Opposite Parties No.1 and 2, that they were sending the report to the Credit Information Bureau (India) Limited, regarding the closure of loan and not as “settled”. The District Forum was, thus, wrong in coming to the conclusion, that there was deficiency, in rendering service, on the part of Opposite Parties No.1 and 2.

17.            The next question, that falls for consideration, is, as to whether, the complainant Company applied for loan, to ICICI Bank, and, it denied the same, to it, on the ground, that its name figured in Credit Information Bureau (India) Limited,. No document was produced, by the complainant Company, on record, to establish that it applied for loan to ICICI Bank, after the settlement had been arrived at, in respect of the loan, with Opposite Parties No.1 and 2, and it was denied the same, on account of the reason, that the status of its loan account was   shown as “settled” in the CIBIL  Consumer Credit Information Report. In the absence of any document, having been placed, on record, in that regard, mere allegations, contained in the complaint, remained  substantiated. Under these circumstances, it could not be said that, on account of showing the status of the loan account of the  complainant Company, in the CIBIL  Consumer Credit Information Report, as “settled”, it was caused any financial loss, by Opposite Parties No.1 and 2.

18.            The complainant is a Private Limited Company. It prayed for compensation, in the sum of Rs.5 lacs, on account of mental torture, harassment, damage to reputation, defamation, lowering down the reputation and image in the market. It was granted compensation, in the sum of Rs.50,000/-, by the District Forum. The complainant being a Private Limited Company, and, as such a Juristic Person it could not suffer mental agony and physical harassment.  Only a living person can suffer mental agony and physical harassment. Under these circumstances, the complainant being a Private Limited Company was not entitled to any compensation, on account of mental agony and physical harassment. The District Forum was, thus, wrong in granting compensation, in the sum of Rs.50,000/-, to the complainant for mental agony and physical harassment.  The findings of the District Forum, in this regard, being illegal, are liable to be set aside.

19.                       No other point, was urged, by the Counsel for the parties.

20.            In view of the above discussion, it is held that the order passed by the District Forum, being not based on the correct appreciation of evidence, and law, on the point, suffers from illegality and perversity, warranting the interference of this Commission, and the same is liable to be set aside.

21.            For the reasons recorded above, the appeal is accepted, with no order as to costs. The order of the District Forum is set aside. Respondent No.1/complainant shall, however, be at liberty to resort to any other legal remedy which may be available to it

22.            Certified copies of this order, be sent to the parties, free of charge.

23.            The file be consigned to Record Room, after completion

Pronounced.

January 10,2013                                                                             Sd-

[JUSTICE SHAM SUNDER (RETD.)]

PRESIDENT

Sd-

[NEENA SANDHU]

MEMBER

Rg