ORDER
S.N. Kapoor, J. (Presiding Member)
1. This order shall dispose of Complaint No. 171/98 claiming refund of an amount of Rs. 61,91,891 with interest at the rate of 17% p.a. from 1.3.1998 and Rs. 11,00,000 as compensation. In all, the complainant has prayed for refund of Rs. 72,91,891 with interest at the rate of 17% p.a. with costs.
2. The complainant, a partnership concern, has filed this complaint through one of its partners, Mr. Kamal Kishore Innani. The complainant was selling and supplying cotton to the opposite party with whom it was having substantial business dealings. The opposite party represented that it could keep money on call deposit. The complainant kept Rs. 75,00,000 as call deposit at the rate of 17% p.a. Opposite Party issued balance certificates in the years 1984 and 1985. On request of the complainant for payment of the amount, the opposite party paid a sum of Rs. 45,00,000 by July 1995 out of the total deposit of Rs. 75,00,000. On 31.3.1996, total amount payable to the complainant was Rs. 54,93,251 inclusive of interest as per the terms agreed to between the parties.
3. On 28.2.1998, the opposite party was to pay Rs. 61,91,891 inclusive of interest agreed and calculated up to 28.2.1998. Despite demand the amount had not been paid. Since the opposite party agreed to pay interest at the rate of 17% p.a. on the deposit, the party had undertaken to render financial services. Not refunding the amount held by it with interest from the complainant would amount deficiency in service and consequently a complaint was filed.
4. The opposite party, Kolhapur Zilla ” Shetkari Vinkari Sahkari Soot Girani Ltd., (hereinafter referred to as the Society for short) has contested this complaint on the ground that the complaint is not tenable under the Consumer Protection Act, (CP Act for brief). The relationship between the complainant and the opposite party was that of seller and purchaser of cotton and not of a consumer and a supplier. The opposite party is not a banking company but is an agriculture processing society under Rule 12 of Section 9 of the Maharashtra State Co-op. Societies Act, 1960. The opposite party was not entitled to accept call deposit but having business relation with the complainant and as per the request of the complainant, the cotton purchase dues were converted into deposits. The complainant company is not a registered partnership firm and Kamal Kishore Innani is not a registered partner and hence not competent to file a complaint. Consumer Fora or this Commission has no jurisdiction to try and decide the complaint under the CP Act for the nature and transactions stretching the business of the society there were no hiring of services. Only Co-operative Court has jurisdiction to try and decide the complaint. It has never agreed to pay interest at the rate of 17% p.a. There was no balance confirmation between the parties. There was no deficiency of service, therefore, opposite party is not liable. The complainant is not within limitation for no transaction took place on or before 15.3.1998. The opposite party is not liable to pay an amount of Rs. 10 lakh or any other amount claimed towards damages or Rs. 1 lakh towards mental agony and inconvenience. The complainant filed rejoinder stating that the complainant firm is a registered partnership firm and produced Form A register extract issued by the Registering Authority.
5. Insofar as the point of registration of the firm is concerned, the complainant has not only asserted that the complainant firm is a registered partnership firm and Mr. Kamal Kishore Innani is one of its registered partners and also annexed with it the Form A. It may also be noted that this aspect has not been challenged any further by the opposite party. Consequently, it could not be said that the complaint is not maintainable on this score.
6. The next point which requires consideration is to the effect that the opposite party is a Co-operative Society and as such a Co-operative Court should have been approached and the consumer Fora would not have any jurisdiction in the matter is to be answered in negative in view of the judgment of the Supreme Court in The Secretary, Thirumurugan Co-operative Agricultural Credit Society v. M. Lalitha (Dead) through L.Rs. and Ors. I (2004) CPJ 1 (SC) : I (2004) SLT 200 : 2004(1) CPR 35.
7. In regard to the contentions about the issuing of balance certificates in the year, 1994 and 1996 and the statement of accounts has not been specifically denied. As such, it is apparent that the opposite party does not dispute that it has received the amount, issued balance certificates and statements of accounts.
8. It is not in dispute that there is a balance certificate dated 31.3.1994 indicating a credit balance by way of deposit Rs. 75 lakh and interest payable and again Rs. 15,48,000 with TDS deduction of Rs. 1,42,800 was issued. Before that, there was similar certificate dated 31.5.1993. There is another letter dated 25.4.1995 which reads as under:
We hereby confirm that your Call Deposit Account with us shows a credit balance of Rs. 50.00 lacs (Rupees fifty lacs only), as on 31st March, 1995 is Rs. 11,47,499 (Rupees eleven lacs forty-seven thousand four hundred ninety-nine only) and credited to your account. Please note that we have debited from your account Rs. 1,14,750 (Rupees one lac fourteen thousand seven hundred fifty only), being 10% T.D.S. as on 31.3.1995. Please confirm the same.
9. The above certificate was followed by another balance certificate which reads as under:
This is to certify that the Account of Mr. Kamal Trading Co., Raichur with us shows a credit balance by way of deposit of Rs. 40,00,000 and interest payable A/c Rs. 5,47,028 T.D.S. is deducted Rs. 54,703 from forty four lacs ninety two thousand three hundred twenty five only payable as on 31.3.1996.
10. The dispute arose only thereafter. According to the statement of call deposit, following statement of account on call deposit w.e.f. 1.4.1996 to 31.3.1997 issued by the complainant was as under:
Statement of Account of Call Deposit
A/c. 1.4.1996 to 31.3.1997.
_________________________________________________________________________________
Date Particulars Debit Credit
_________________________________________________________________________________
1.4.96 Opening Balance
B/F 45,25,074.00
31.3.96 Towards T.D.S.
debited by you,
which was not
paid (for the year
1995/1996) 54,703.00
31.3.97 Interest amount on
Rs. 45,79,777 7,78,562.00
31.3.97 Balance due to us on
31.3.1997 53,58,339.00
______________
Total: 53,58,339.00
_______________________________________________________________________________
And for the year 1998 was as under:
Statement of Account of Call Deposit
A/c. 1.4.1997 to 28.2.1998.
_________________________________________________________________________________
Date Particulars Debit Credit
_________________________________________________________________________________
1.4.97 Opening Balance
B/F 53,58,339.00 _
28.2.98 Interest @ 17%
p.a. debited upto
28.2.1998
(53,58,339 x 334
days x 17% /365) 8,33,552.00
28.2.98 Balance due 61,91,891.00
____________________________________
Total 61,91,891.00 61,91,891.00
________________________________________________________________________________
11. It is evident from the above that on 30.4.1996, the opposite party has acknowledged their debt to the tune of Rs. 44,92,325. On 18.2.1998, it appears that a notice demanding the amount was sent through Mr. D. Suresh, Advocate followed by another notice dated 4.3.1998. In response to the notice, a reply was sent by the opposite party. The Managing Director did not dispute the balance as on 28.2.1998 was Rs. 61,91,891.
12. How ever, it claimed that out of balance of Rs. 61,91,891 a sum of Rs. 45,25,074 stood adjusted as on 31.3.1996, for the opposite party claimed to have transferred the following amount:
__________________________________________________________________________________
Particulars Amount
__________________________________________________________________________________
Bal. Demand as per party 61,91,891.00
Less – out of credit bal. of – Rs. 45,25,074.00
as on 31.3.1996 amt. debited by transfer
and rectified the interest entry as under
on 31.3.1996.
(1) Amt. transfer to cotton purchase
Dues Account on 31.3.1996 4,85,607.00
(2) Interest amount of 1995-96 rectified
and debited on 31.12.1996 as 4,92,385.00
Per our letter No. Actts/3363 dated
1.3.1997 54,703.00
(Rs. 5,47,028.00 : Rs. 54,70,703.00).
(3) Amount of interest claimed by party
which is not agreed by us as under
on 31.3.1997 7,78,562.00
and on 28.2.1998 8,33,552.00
______________
26,44,749.00
_______________________________________________________________________________________
13. As regards the rate of interest, while it is apparent that interest has been given not at the rate of 17% insofar as the balance certificates are concerned it is much more. Seeing the relevant year, the nature of transactions of deposits, one is inclined to accept that the interest should have been paid at the rate of 17% p.a. though earlier it was paid at much higher rate.
14. There could not be unilateral reduction in the rate of interest after jiving it and as such opposite party could not have claimed rectification of Rs. 4,92,385 + Rs. 54,703 less the amount of interest claimed by the complainant. As regards the amount of transfer of Rs. 4,85,607, it may be mentioned that in Para 6 of the affidavit it is stated as under:
That pursuant to the said letter dated 21.2.1992, the management of the opposite party mill accordingly converted the said amount of dues into deposit the same day. And the complainant had not made any separate payment in cash or cheque towards call deposit. Thereafter as per request of the complainant the mill remitted Rs. 55,22,858 out of the amount converted into deposit along with interest accumulated thereon and only Rs. 29,47,147 remained due. The letter dated 12.3.1998 to the same effect was sent to the complainant, the office copy whereof, in original, is marked as Exh. 2.
15. In para 9 of the complaint it is mentioned that the amount mentioned at Item No. 1 (letter dated 12.3.1998 Ann. 2) is not paid at any time and the said amount is in no way concerned with the call deposit claim. This has not been replied to specifically by the opposite party. Consequently, the opposite party could not claim any adjustment of Rs. 26,44,749. As regards the amounts mentioned in Item No. 4 amounting to Rs. 6 lakh paid from 30.6.1997 to 5.11.1997, the complainant has specifically alleged that those amounts were paid towards the price of the cotton supplied and the said payment had been adjusted towards cotton dues:
The complainant further would like to bring to the notice of the Hon’ble Commission the fact that in the recent letter of the opposite party dated 12.3.1998 and marked as Annexure No. 11 filed along with this complaint, it has admitted the dues at Rs. 61,91,891 but has tried to impress that out of this amounts shown in Column No. 1 as items 1, 2, 3 and 4 are not payable and the total amount of Rs. 32,44,749 is to be deducted from the total claim of Rs. 61,91,891 and amount due is only Rs. 29,47,142. It is humbly submitted that this claim is false and unsustainable because:
Amount shown at Item No. 1 is not paid at any time and the said amount is no way concerned to the “Call Deposit” claim.
Amounts at Item Nos. 2 and 3 are legally due being interest amounts and the opposite party once having agreed to pay interest cannot take any unilateral decision not to pay interest without notice and consent of the complainant.
Regarding amounts mentioned at Item No. 4, the complainant submits that, these amounts were paid towards the price of cotton supplied and the said payment have been rightly adjusted towards cotton dues and these amounts cannot be deducted from the Call Deposit claim amount. Hence the amount claimed in this complaint is legally due and the opposite party is bound to pay the same in discharge of his obligations included in service assured.
16. This part also has not been specifically denied. Consequently, the opposite party cannot claim any adjustment, taking into consideration that on 28.2.1998 the opposite party was liable to pay Rs. 61,91,891 with interest as on 28.2.1998.
17. The opposite party disputed the amount for the first time on 21.3.1998. But before this date, the opposite party not only acknowledged, that as on 31.3.1996, as per the statement of account and the balance certificate, a sum of Rs. 44,92,325 were due, but also by made certain payments. According to statement of accounts signed by Managing Director, from 22.12.1992 till 31.3.1996, a sum of Rs. 45,25,074 was due. Since the dispute arose after acknowledging the debt on 31.3.1996 disputing the claim of the complainant by letter dated 12.3.1998, it could not be said that the amount claimed was barred by time by any stretch of imagination.
18. The moment the deposit of Rs. 75 lakh was accepted with the promise of giving attractive rate of interest with security of investment, even if the amount of Rs. 75 lakh of sale proceeds of cotton was converted into deposits, consequently, such a transaction is clearly providing service for consideration depositor. The partnership is clearly consumer under the C.P. Act and the respondent cannot be absolved from the liability to pay in case they are found deficient in service as in the case of Neela Vasant Raje v. Amogh Industries and Anr. III (1993) CPJ 261 (NC) : 1986-94(National a Commission & Supreme Court on Consumer Cases) 446 (NS).
19. So far as the contention that the opposite party being Co-operative Society is concerned the complainant should approach b only the Co-operative Court under Maharashtra Co-operative Societies Act, would also not help the opposite party for this matter is squarely covered by the judgment of Supreme Court in The Secretary, Thirumurugan Co-operative Agricultural Credit Society v. M. Lalitha (Dead) through L.Rs. and Ors. (supra). In this case, Section 90 of the Consumer Co-operative Societies Act came up for consideration along with Section 156 of the Act and Section 3 of the C.P. Act. After referring to these provisions in Paras 8 and 10, following observations were made:
In General Assembly a Consumer Protection Resolution No. 39/248 was passed and India is a signatory to this Resolution. The United Nations had passed a resolution in 1985 indicating certain guidelines under which the governments could make laws for better protection of the interest of the consumers and such laws were more necessary in developing countries to protect the consumer from hazardous to their health and safety and to make them available speedier and cheaper redress. With this background, the 1986 Act was enacted. The statement of objects and reasons show that the Consumer Protection Bill, 1986 sought to provide for better protection of the interest of the consumers and for the purpose, to make provision for the establishment of Consumer Council and other authorities in the settlement of consumer disputes and for matters connected therewith. It seeks, inter alia, to promote and protect the rights of consumers such as protection against marketing of goods which are hazardous to life and property; the right to be informed about the quality, quantity, potency, purity, standard as price of goods to protect the consumers against their trade practices; the right to be assured, wherever possible, access to an authority of goods to be assured that the interest of consumers will receive due consideration at appropriate forums; the right to seek redressal against unfair trade practices or unscrupulous exploitation of consumers and right to consumer education. The object is also to provide speedy and simple redressal to consumer disputes, a quasi-judicial machinery is sought to be set up at the District, State and Central levels. These quasi-judicial bodies will observe principles of natural justice and have been empowered to give relief of specific nature and to award, wherever appropriate, compensation to consumers. Penalties for non-compliance of orders given by quasi-judicial bodies have been provided.
The preamble of the Act declares that it is an Act to provide for better protection of the interest of consumers and for that purpose to make provision for the establishment of Consumer Council and other authorities for the settlement of consumer disputes and matters connected therewith. In Section 3 of the Act in clear and unambiguous terms it is stated that the provisions of 1986 Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.
From the statement of objects and reasons and the scheme of 1986 Act, it is apparent that the main objective of the Act is to provide for better protection of the interest of the consumer and for that purpose to provide for better redressal, mechanism through which cheaper, easier, expeditious and effective Redressal is made available to consumers. To serve the purpose of the Act, various quasi-judicial forms are set up at the District, State and National levels with wide renege of powers vested in them. These quasi-judicial forums, observing the principles of natural justice, are empowered to give relief of a specific nature and award, wherever appropriate, compensation to the consumers and to impose penalties for non-compliance of their orders.
As per Section 3 of the Act, as already stated above the provisions of the Act shall be in addition to and not in derogation of any other provisions of law for the time being in force. Having due regard to the scheme of the Act and purpose sought to be achieved to protect the interest of the consumers, better the provisions are to be interpreted broadly, positively and purposefully in the contact of the present casexs to give meaning to additional/extended jurisdiction, particularly when Section 3 seeks to provide remedy under the Act in addition to other remedies provided under other Acts unless there is clear bar.
Consequently, this plea would also not help the complainant.
20. It was also contended by the opposite party that the Co-operative Society is not having financial status. But what we see is that on one hand it was stated in the written statement (in para 15) that other cotton sellers have covered their cotton dues by adopting job work systems during past yearspaying the cotton dues by way of job work systemclearly indicating that the intention is to coerce the complainant to adopt the job work system to receive the amount due (which was converted into deposits). This could not be accepted.
21. For the aforesaid reasons, we are of the considered opinion that the complainant is entitled to get refund of Rs. 61,91,891 with interest at the rate of 17% p.a. from the date of complainant till payment.