LAWS LAID DOWN BY SUPREME COURT IN BANKING&FINANCING MATTERS

 

CONSUMER TOWARDS PROVIDENT FUND COMMISSION

 

RPFC V. Shiv Kumar Joshi, 2000 AIR (SC)331 : 2000 I LL J 552 : 2000(96) FJR 33 : 2000 I LL N 323 : 2000 LIC 232 : 2000 I CLR 2115 : 2000 SCC (L&S) 37 (SC.2J) 

It has been held that it is rendering of service for consideration as defined in the Consumer Protection Act. The definition of "consumer" is not exhaustive and section 2(i)(o) exempts only such services as are rendered free of charge or under a contract of personal service. The commissioners under the said Act give statutory service on payment of administrative charges which are levied and recoverable by the commissioner for payment of services rendered by the commissioner and the ancilliary staff and they are required to invest the contributions to the Employees Provident Fund like any other banker or financial institution to earn interest and to credit the interest to the subscribers account at such rate as may be determined by the Central Govt. In relation with Central Board .

Another related cases are :-
i) Kamlesh Vohra V. Central Provident Fund Commissioner & ors.1993 CPJ 232 (Delhi State Commission)

Regional Provident Fund Commissioner V Bhavani SC(CP) p 563 decided on 22nd April 2008, held

“ that non payment of dues to the complainants[number of cases of similar nature on the similar point of law clubbed together ] under Employees Pension Schemes  amounts to deficiency in services .By becoming a member of the employees family pension scheme and contributing to the same ,one avails services rendered under section 2(1)(O) by the commission for implementing the scheme,hence is a consumer under section 2 ( 1 ) (d) of the act.” Supreme court has  not agreed with  the plea taken by Regional Provident Fund Commission that provident fund commission is not a service provider it being a statutary body

Jagdish singh v State bank of Patiala and others, Decided on 27th Feb.2008 by Punjab SCDRC in appeal no 953 of 2006 p633,CTJ

 

GUARANTOR’S LIABILITY AND LIABILITY OF THE SURETY

 

“Banks /financial institutes can recover their dues from the guarantor or surety even without exhausting their remedy available to them against the borrower .Consumers are to sign such documents with great care and after they understand the consequences thereof,”

Manohar lal Bhandari v Sun Earth Ceramics [RP No.1926 of 2004 ]order dt 26.5.2009 reported as 2009 CTJ 68(CP)(NCDRC)

CONSUMER’S RIGHT WHEN COMPANY GOES SICK

 

National Commission Held

“ that   section 22 of SICA 1985,does not provide for any permission to continue with a pending complaint before consumer court nor does it place any restriction to deal with pending proceedings under the CP act  1986.It only talks of permission from BIFR  to file suit/recovery proceedings  before the civil court .Fixed Deposits are not recovery matters ,it is a consumers own money kept with the company with a promise to pay it back with agreed interest.Hence consumer’s case can continue before the consumer forum and  company’s reference to BIFR shall not make any difference or bar the consumer forum to deal with the matter before it”

Smt Sarvjeet Kinra v Modern Denim Ltd in 2008 in appeal no 2069of 2006 alongwith Appeal no 2067 of 2006and 2068 of 2006

;in the matter of Smt Sarvjeet Kinra v Modern Thread ((India )Ltd Appeal no 2065 of 2006

:in the matter of Ms Priti Kinra v Modern Terry Towel Ltd Appeal No 2066of 2006 SCDRC Rajasthan( Jaipur)

Held,

“Deposit is not a loan but a sum held in trust till the time of maturity Respondant companies were made to pay the principle amount with agreed rate of interest till the date of maturity  but there after simple interest was allowed to be paid as spelled out in the scheme approved by Company Law Board.”

In View of the discussions above ,the law related to Fixed deposits made by the depositor/consumer as on date through various judgements is as hereunder:

1)         Depositor is a consumer under Consumer Protection Act 1986 as amended upto 2002 for receiving services from the service provider who keeps his acconts,calculates and sends interest ,isssues FDR etc and also uses his money for expanding his business for a specified fixed tenure.

2)         Depositor can go to the consumer court even if  respondent company is referre to BIFR and even declared sick.Consumer is not to seek permission from BIFR under the provisions of section 22(1)of SICA for filing his complain before the consumer  forum.

3)           In case company  after getting declared sick approaches Company Law Board for preparing a scheme for making payment to the creditors ,in such circumstances ,consumer can go to Company law board for their claim afresh in order to avoid any ambiguity in the orders of both the redressal agencies  and also for execution of their order if any obtained from the consumer court by that time .

4)             In case company fails to pay the amount due to the consumer as per the scheme prepared /approved by the Company law board ,consumer can contact with  his complaint to the Company Law Board under the Reserve Bank Of India (amended )Act 1997.

 

 

 

Dr Prem Lata

Member, Consumer Forum

(west Delhi)

 

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