THE KERALA STATE CONSUMER DISPUTES REDRESSAL COMMISSION
VAZHUTHACAUD, THIRUVANANTHAPURAM.
APPEAL . NO - 656/2013
ORDER DATED. 11/12/2017
PRESENT:-
HON’BLE JUSTICE SRI. S.S.SATHEESACHANDRAN : PRESIDENT
SRI. V.V.JOSE : MEMBER
APPELLANT :
Standard Chartered Bank Limited,
Represented by its authorized officer,
HDFC House, Ravipuram , Ernakulam
(By Adv. Ranjana. R)
V/s
RESPONDENT:
V.P. Rasheed, Proprietor,
E Oriental Timbers, IV/ 131, NH Bye pass,
Edappally, Ernakulam – 682 024.
(By Adv. Shaijan C. George )
JUDGMENT
HON’BLE JUSTICE SRI. S.S.SATHEESACHANDRAN : PRESIDENT
Appeal is directed against the Order in CC.620 of 2011, passed by Consumer Disputes Redressal Forum, Ernakulam, for short, the District
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Forum. First opposite party, a bank, has filed this appeal aggrieved by the order of the Forum directing it to refund the pre-closure charges collected from the complainant on closing of his overdraft account.
2. Respondent/complainant availed two facilities from the bank – a loan of Rs.2 crores repayable in 120 monthly instalments @ Rs.2,92,752/- and another overdraft facility upto a limit of Rs.2 crores for a period of one year. According to him, he closed the overdraft account before the expiry of one year period, on which pre-closure charges @ 2% on the outstanding amount due was collected by the bank. Challenging the collection of pre-closure charges as illegal complaint was filed for refund of that sum with compensation. Opposite parties resisted the claim contending that pre-closure charges were collected on
the overdraft account as per the terms and conditions agreed upon and the bank was entitled to realize such sum when the account was closed before the period fixed.
3. Appreciating the materials produced by both sides, the Forum below upholding the case of complainant, directed the bank to refund
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the sum collected as pre-closure charges on the overdraft account within 30 days from the date of receipt of its order, failing which, the amount due was directed to carry interest @12% per annum till realization. Aggrieved by that Order, first opposite party has preferred this appeal.
4. We heard counsel on both sides. We notice that the Forum below has lost sight of the fact that overdraft facility is extended only for commercial activity of an individual or company or firm and not for any other purpose. To facilitate business activities of a customer, the bank provides such facility enabling him to collect goods or raw materials at the credit limit agreed upon. Where it was evident that the facility extended by the bank was for commercial activity of the complainant, even if such a contention was not raised in the version of the opposite parties, it was incumbent upon the Forum to examine whether the complainant was a consumer as defined in Section 2(m) of the Consumer Protection Act . Complainant has no case that he was carrying his business for self-employment and also eking out livelihood from such business. When that was so and no case to claim exemption
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as consumer under the Act is made out, the irresistible conclusion follows that he had availed overdraft facility from the bank for commercial activities for earning profit. He was not a consumer and thus his complaint filed before the Forum to claim refund of the pre-closure charges collected on his overdraft account was not at all maintainable. Reversing the Order of the Forum below, it is ordered that the complaint filed by the complainant shall stand dismissed.
Appeal is allowed directing both sides to suffer their cost.
JUSTICE S.S.SATHEESA CHANDRAN: PRESIDENT
V.V.JOSE : MEMBER
Rj/sh-
