A R NARAYAN Vs. STATE BANK OF HYDERABAD

JUDGEMENT

(1.) The appellant A.R. Narayan is the managing partner of the Firm, carrying on business under the name and style of "Fast Forward". The business of the firm is the production and marketing of pre-recorded audio cassettes. According to the allegations contained in the complaint, filed by the present appellant before the State Commission of Tamil Nadu, the said firm was originally having account with the United Commercial Bank (for short 'UCO' Bank), Madras. As the said Bank failed to give the complainant need based finance, he approached the opposite party, the State Bank of Hyderabad, on 1st May, 1990 for getting credit facilities to the extent of Rs. 3 lakhs. The opposite party agreed to give those facilities and took over the account of the UCO Bank and also agreed to obtain, "No Dues Certificate" from that Bank. The amount due from the complainant to the UCO Bank was Rs. 2.50 lakhs after deducting penal interest. The opposite party on the very date of sanctioning of the credit facilities, issued a pay order for Rs. 2.50 lakhs in settlement of the complainant's dues to the UCO Bank. Later on the UCO Bank further claimed a sum of Rs. 39,809.81 paise as due from the complainant and informed the opposite party accordingly. The opposite party called upon the complainant to get clearance from the UCO Bank and obtain "No Dues Certificate". The complainant contacted the UCO Bank for payment of his balance in instalments but the opposite party did not advance any further amount. In February, 1991 the complainant again requested the opposite party to help him with an advance of Rs. 20,000/- at least but the request was turned down. The business of the complainant had come to a stand still since September, 1990. The complainant's grievance in the complaint was that the opposite party was guilty of unfair trade practice and had failed to obtain "No Dues Certificate" from the UCO Bank and also failed to sanction further advances. He therefore, claimed Rs. 6 Lakhs as compensation.

(2.) The opposite party contested the complaint and averred that when the complainant had failed to get further facilities from the UCO Bank the opposite party afforded the credit facilities to the complainant to the tune of Rs. 3 lakhs. The Manager of the opposite party was given to understand that the amount due from the UCO Bank was only Rs. 2.50 lakhs and accordingly a pay order for that amount was issued by the opposite party on the date of sanctioning loan facilities. Even thereafter funds were provided to the complainant for the conduct of his business and he had fully utilised the facilities and his indebtedness at present to the opposite party come to Rs. 3.73 lakhs. The complainant was frequently exceeding his credit limit and was assuring that he would bring it down to Rs. 3 lakhs but failed to do so. The contention of the complainant that he had settled with the UCO Bank for the payment of the balance dues in instalments was found false. In view of the claim made by the UCO Bank, the opposite party insisted upon the complainant to furnish from UCO Bank the "No Due Certificate" which the complainant failed to produce. There was no obligation on the part of the opposite party to get the "No Dues Certificate" from the UCO Bank. It was also denied that the opposite party took over the entire liabilities of the complainant from the UCO Bank. As the complainant had exceeded his limit, further operation of the account was stopped and further facilities were denied. Thus, according to the opposite party, there was no deficiency in the rendering of service by them.

(3.) The State Commission of Tamil Nadu, as noticed earlier, before whom the complainant filed the complaint, vide their impugned order came to the conclusion that there was no default or deficiency in the rendering of service on the part of the Bank and it was, in fact, the complainant himself who had been overdrawing in his account with the opposite party. Accordingly the complaint was dismissed with costs which were assessed at Rs. 500/-.