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Judgment
-THIS is a complaint under Section 17 read with Section 12 of the Consumer Protection Act.
THE complainant claims vast experience in Food Processing Technology. She started in a rented premises as early as in 1987 manufacturing Appalam/Papad and other products. She approached the first opposite parry Tamilnadu Industrial Investment Corporation for financial assistance. She submitted her loan application in 1991 and remitted the investigation fee of Rs. 1485/- on 14.6.91. A Screening Committee of the opposite party considered the matter and sanctioned a term loan of Rs. 7,20,000/- n 19.8.91. As per clause 28 of the above order 50% of the amount will be released at the time of delivery of the machineries and the balance after valuation. THE complainant represented that for designing and manufacturing the machineries advance has to be paid and requested the opposite party to pay at least 75% of the value as cash advance. THE complainant paid a sum of Rs. 38,000/- for her share of the land and a cheque was issued to her on 21.2.92 for Rs. 1,41,850/- instead of Rs. 2,90,700/- THE Branch Manager Mr. Venkataraman told the complainant to proceed with the work and get what can be fabricated or purchased and submit invoice. Accordingly the complainant placed orders and received 4 items of machineries. On 23.3.92 for a sum of Rs. 154,800/-. But subsequently mere was change in the staff and the new Manager ordered a second inspection on 10.6.92. THE opposite parry wrote a letter to Anna University, Madras for valuation of the machinery. THE valuation report was submitted on 2.7:92 but the opposite party did not released the funds; instead it claimed collateral security from the complainant THEre was no such stipulation for furnishing collateral security in the first sanction order dated 19.8.91. It was also falsely alleged, that the dryer was kept in the portico of the building and exposed to sun or rain. THE opposite party instead of considering complainant''s letter on merits have unilaterally cancelled the contract for no fault of the complainant by letter dated 20.10.92. THE complainant has therefore come forward with this claim for compensation in the sum of Rs. 15,25,004/-. The opposite parties resisted the claim. It is contended that the complainant is not a consumer and the complainant is not maintainable. It is pointed out that the complainant originally applied for a term loan of Rs. 9,90,000/- for a soft loan of Rs. 90,000/- on 14.6.91 for the purchase and erection of machinery and construction of building on the land at Ninnakkarai village. The complainant subsequently dropped the proposal of purchase of Land and construction of building and opted for leasehold premises at No. 7A, Mahalakshmi St., Srinivasapuram Guduvancherry. The project was revised and she applied for a term loan of Rs. 7,80,000/- and soft loan of Rs. 75,000/- for purchase of machinery. A term loan of Rs. 7,20,000/- and soft loan of Rs. 1,44,000/- on 14.8.91 was sanctioned. The money will be released at 50% at the time of delivery and 50% after valuation at site. The complainant accepted the terms and conditions. The period of lease of the building was for 8 years and the opposite party insisted on production of the registered Lease Deed. The complainant wanted to purchase the land measuring 11,000 sq.ft. in S.No. 34/lA- Ninnakkarai Village, Chenglepat District. The complainant offered collateral security of the land to be purchased by her but she failed to give the security even after purchase of the land. It was found that only few items have been purchased and the complainant did not give protection to the hypothecated machinery. The opposite party sent a letter dated 16.6.92 calling upon the complainant to shift the machinery inside the lease-hold premises. The complainant requested by her letter dated 22.10.91 to grant time till June 1992 to offer the property as collateral security. She failed to deposit the original sales deed to create mortgage by deposit of tide deed. She also failed to protect the hypothecated machinery. The complainant has also failed to pay the dues nor implement the project The complainant was liable to pay a sum of Rs. 1,94,005/- towards Principal, Interest and other dues. No payment was forth coming. The opposite party had therefore no other way except to foreclose the loan and take possession of the machinery under Section 29 of State Financial Corporation Act. A notice to that effect was given on 6.9.93. Immediately the complainant filed a suit in the City Civil Court in O.S. 7849/93 for injunction restraining the opposite parties from taking possession of the unit. The suit was filed in September 1993 it self. But the complainant was not able to get any order of interim injunction or stay. She has therefore filed this complaint on 11.1.94. The allegations in the complaint are false and are unsustainable.
Exhs. A1 to A17 and B1 to B12 are marked. Proof affidavits are filed. No oral evidence has been let in.
THE preliminary point which arises for consideration is whether this complaint is maintainable in view of the pendency of O.S. 7849/93 on the file of the City Civil Court, Madras. Point: The complainant has applied for a term loan to the opposite party Tamilnadu Industrial Investment Corporation and it has sanctioned a term loan of Rs. 7,20,000/- and soft loan of Rs. 1,44,000/- under Exh. A2 dated 19.8.91. It has disbursed a sum of Rs. 1,41,850/- Subsequently the opposite party officials have visited the premises and found that only 4 machineries have been purchased and they were also exposed to sun and rain. The opposite party has called upon the complainant to furnish collateral security. According to the complainant, the original order for sanctioning the loan does not provide for giving any collateral security and the opposite parties had no right to claim collateral security. It is the further case of the complainant that the opposite parties have unilaterally cancelled the loan and given Exh. A17, foreclosure notice dated, 6.9.93 calling upon the complainant to pay the sum of Rs. 1,74,995.35 with subsequent interest failing which the opposite parties would be constrained to take action under Section 29 of the SFC Act (State Financial Corporation Act) without prejudice to their other rights of recovery on her failure to pay the abovesaid sum. The complainant has alleged deficiency in service on the part of the opposite parties which are the head office and branch office of the TIIC and claimed a sum of Rs. 15,25,004/- as compensation.
THE contention of the opposite party is that the loan was sanctioned under the hire purchase of the machinery but the opposite party has purchased only 4 machineries and they were also supplied as ready-made items. According to the opposite party the complainant has offered to give collateral security of the land to be purchased and even after purchase of the land she failed to deposit the title deeds as security. In Exh. B10 letter dated 8.10.91 the opposite party has accepted that she offered to produce collateral security of the land after purchase. This offer is also reiterated in Exh. B11 letter dated 22.10.91. Evidently the complainant has not given the security. A sum of Rs. 1,94,005/- was due and the complainant did not pay the amounts on instalments. Finally the opposite parties have issued Exh. A17 notice foreclosing the loan, calling upon the complainant to pay the loan amount with interest and threatening to take action under Section 29 of the State Financial Corporation Act. It is therefore the case of the opposite party that there has been no deficiency in service on their part. It is significant to note that the complainant on receiving Exh. A17 foreclosure notice dated 6.9.93 has filed a suit in the City Civil Court, Madras In O.S. 7849/93 for injunction restraining the opposite parties from taking possession of the unit. A copy of the plaint is now produced is marked as Exh. B12. We have gone through the plaint and we find that the allegations are the same as those contained in this complaint. The matter in issue in both the suit and in the complaint is whether the opposite parties were right in insisting upon furnishing collateral security, claiming back the loan amount and issuing the foreclosure notice. It has been repeatedly held by this Commission as well as by the National Commission that where the matter is sub-judice before the ordinary Civil Court, a concurrent adjudication in respect of the same will not be conducted by this Commission under this Consumer Protection Act. As pointed out by the National Commission in M/s. Special Machines, Karnal v. Punjab National Bank & Others, I (1991) CPJ 78 (NC), the objection is not really on the ground of lack of jurisdiction but is one based on consideration of propriety and prudence keeping in view the necessity for avoidance of conflicting decisions and multiplicity of proceedings. In view of the pendency of O.S. 7849/93 filed by the complainant in the City Civil Court, Madras, this complaint is not maintainable. It is also pertinent to point out that this suit in O.S. 7849/93 has been filed by the complainant in September, 1993 soon after receiving Exh. A17 notice dated 6.9.93. The present complaint before this Commission has been filed on 21.1.94 nearly 4 months later. But there is not even a whisper about the earlier suit filed by her before the City Civil Court. There has been a deliberate suppression of the pendency of the suit filed by the complainant in the City Civil Court in this complaint filed before this Commission. It is obvious that the complainant has not come to this Forum with clean hands, and she is not entitled to any relief in the hands of this Commission.
WE therefore hold that the complaint is not maintainable and dismiss the same without prejudice to the right of the complainant to agitate her claim in the suit filed by her before the City Civil Court. Complaint dismissed.