Dispute Requires Police Investigation, Can’t Entertain, Uttarakhand State Commission Sets Aside District Commission’s Order

Brief Facts:

Dev Caterers (“Complainant/Respondent”), a proprietorship business owned by Sh. Shashi Kant Bose operated a current account with Oriental Bank of Commerce (“Bank”), Rajpur Road, Dehradun. The bank issued two chequebooks upon the complainant's request. The complainant used these cheques to pay suppliers between August 13, 2012, and August 24, 2012, but the bank dishonoured them. Upon discovering this, the complainant requested a statement of account and found that Rs. 3,96,500 had been illegally withdrawn from his account between August 13, 2012, and August 21, 2012.

The complainant contacted the bank and reported the unauthorized withdrawals, also complaining to the police. The bank, in response, claimed that the complainant had requested the issuance of the chequebooks through an application signed by an employee of Dev Caterers. The bank argued that the complainant was aware of these transactions, and the signatures on the cheques matched those in their records. The bank asserted that it had no deliberate intention to issue the chequebooks or make the payments erroneously and accused the complainant of making false allegations. Aggrieved, the Complainant filed a consumer complaint in the District Consumer Disputes Redressal Forum, Dehradun (“District Commission”) against the bank. The District Commission decided in favour of the Complainant and ordered the Bank to pay Rs. 3,96,000/- with 7% interest.

Aggrieved by the order of the District Commission, the bank filed a first appeal in the State Consumer Disputes Redressal Commission, Uttarakhand (“State Commission”). The bank argued that the District Commission's judgment was illegal, lacked proper consideration, and was biased. It further contended that the complainant, who holds a commercial current account, does not qualify as a "Consumer" under the Consumer Protection Act. The bank also presented a handwriting analysis report from an expert to assert that the signatures on the disputed cheques match the complainant's specimen signatures. Furthermore, the bank argued that the matter is criminal and involves extensive evidence and witness cross-examination, which falls outside the scope of the Consumer Protection Act. It emphasized that criminal proceedings are already underway, making the District Commission's jurisdiction inappropriate. The complainant's failure to safeguard the cheques is not the bank's fault, and there is no deficiency in the bank's service.

Observations by the Commission:

The State Commission started by perusing Section 2(d) of the Consumer Protection Act, 1986 which provides that the transaction for commercial purpose does not come within the purview of the Consumer Protection Act, 1986. The State Commission then interpreted the Complainant’s transaction to be commercial and held that the Consumer Protection Act wasn’t applicable in this case. Moreover, it was held that the District Commission lacked jurisdiction as the dispute was criminal which required thorough Police Investigation. Thus, without any cogent and reliable evidence and findings of the investigating officials, the State Commission deemed that holding the Bank liable was inappropriate.

Consequently, the appeal was allowed and the order of the District Commission was set aside based on irregularity and illegality.

Case Title: Oriental Bank of Commerce vs Dev Caterers

Case No.: First Appeal No. 26/2017

Advocate of the Complainant: Sh. S.M. Joshi

Advocate of the Respondent: Ms. Anupama Gautam

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