LexUNION BANK OF INDIA versus M/S. SEPPO RALLY OY AND ORS.
Open in Lexace · Ask the AI about this caseJudgment (excerpt)
A
UNION BANK OF INDIA
v
MIS. SEPPO RALLY OY AND ORS.
SEPTEMBER 23, 1999
B
(S. SAGHIR AHMAD AND D.P. WADHWA, JJ.]
Consumer Protection Act, 1986 :
S.2(o) & (g)-Deficiency in service-Bank Guarantee-Invoked-Delay
C in payment of amount under Bank Guarantee-Delay on account of grant of
permission from R.B.l. for remitting the amount in foreign exchange-Held,
does 1101 amount to deficiency in service.
Ss.9(b), 11(2), 17 and 18-Jurisdiction of State Commission-Bank
Guarantee provided by Saharanpur Branch (U.P.) of the Bank-Guarantee
D invoked and payment made by Saharanpur Branch-Complaint against
delayed payment in De/hi-Maintainability of-Held, No part of cause of
action arose in Delhi-Thus, State Commission at Delhi had no jurisdiction
in the matter-Orders set aside.
E
F
Interpretation of Statute
Purposive interpretation-Reading down the provision-Applicability
of
Words and Phrases :
"Deficiency in service"-Meaning and scope of in the context of S.2(g)
of the Consumer Protection Act, 1986.
Appellant-Bank, Saharanpur Branch, provided a Bank Guarantee
in favour of respondent No. 1 ·a foreign company. On invoking the Bank
G Guarantee, there was delay in payment of amount guaranteed. Conse-
quently, respondent No. 1 filed a complaint before the State Consumer
Commission at Delhi, which was allowed. Appeal by Bank before National
Consumer Commission was dismissed. Hence the present appeal.
On behalf of the appellant-Bank it was contended that there was·no
H deficiency in service and the delay in payment was on account of delay in
174
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UNION BANK OF INDIA v. SEPPO RALLY OY
175
grant of permission from RBI to remit the amount in foreign exchange; A
the Delhi State Commission had no jurisdiction to entertain the complaint
as no cause of action arose at Delhi.
Allowing the appeal, this Court
HELD : 1. No deficiency in service provided by the Bank. The B
National Commission and State Commission erred in allowing the com-
plaint of the respondent No. 1 holding that there is deficiency by appel-
lant-Bank for delay in payment of amount under Bank Guarantee. [181-B]
Consumer Unity and T111st Society, Jaipur v. Chainnan and Managing
. Director, Bank of Baroda Calcutta & Anr., [1995] 2 SCC 150, relied on.
2.1. The State Commission at Delhi had no jurisdiction in enter-
taining the complaint against the Bank as no cause of action arose at
Delhi. [176-G]
2.2. Under S.9(b) of the Consumer Protection Act, 1986, State
Commissions were established in each State to take cognizance of the
dispute arising within that State. It cannot be the intention of the
legislature that disputes arising in one State could be taken cognizance
by other State. In the instant case, the Saharanpur Branch of the Bank
situated in U.P. State provided the Bank Guarantee. The Bank Guaran·
tee was invoked at Saharanpur and payment was also made by the said
branch. Thus, no part of the cause of action has arisen in Delhi to
entertain the matter. [176-E; 182-E-G-H; 183-A]
c
D
E
3. S. 11 of the Consumer Protection Act dealing with jurisdiction of F
the District Commission, under sub-section (2) provides the local limits
within which a complaint should be registered. However, there is no such
similar provision in S. 17 of the Act, dealing with jurisdiction of State
Commis8ion. In fact these are the basic provisions conferring territorial
jurisdiction on a Tribunal, otherwise it will lead to absurd situations. G
Thus, by applying purposive interpretation, the provisions contained in
sub-section (2) of S. 11 of the Act must be read into S. 17 of the Act with
necessary modifications. [182-D; F]
CIVIL APPELLATE JURISDICTION: Civil Appeal No. 11440 of
1996.
11
176
SUPREME COURT REPORTS [1999) SUPP. 3 S.C.R.
A
From the Judgment and Order dated 18.6.96 of the National Con-
sumer Disputes Redressal Commission, Delhi in F.A. No. 434 of 1993.
Dushyant A. Dave, U.A. Rana and Ms. Arshi Sohail for M/s. Gagrat
& Co., for the Appellant.
B
J.P. Dhanda and P.N. Gupta (NP) for the Respondents.
The Judgment of the Court was delivered by
D.P. WADHWA, J. Appellant Union Bank of.India is aggrieved by
the order dated June 18, 1996 of the National Consumer Disputes Redres-
C sal Commission ('National Commission' for short) passed on appeal from
the order dated July 21, 1993 of the State Commission of Delhi.
State Commission had allowed the complaint of the first respondent
Mis. Seppa Rally OY, a foreign comExcerpt shown. Read the full judgment & AI analysis in Lexace.