GOPAL K. SAVARAPPA Vs. LAKSHMI VILAS BANK

JUDGEMENT

(1.) Both the parties have filed the appeal against the order dated 19.01.2018 of the Karnataka State Consumer Disputes Redressal Commission, Bangalore ( in short, the State Commission) in complaint no. 446 of 2015.

(2.) The brief facts of the case are that complainant was running a sole proprietorship firm, namely, M/s Sri Jyothi Cotton Ginners for his livelihood and was enjoying the credit limits with the opposite party for the past many years. In his regular course of business, he had supplied cotton bales to M/s Mehala Carona Textiles ( P) Ltd. as per bill no. 291, 292 and 293 dated 06.11.2014 and 07.11.2014 amounting to Rs.39,67,057/-. M/s Mehala Carona Textiles (P) Ltd. opened a letter of credit bearing no. ILC 428INLC0025/14 dated 10.11.2014 on M/s ING Vysya Bank Ltd., Tirupur for a sum of Rs.39,67,057/-. ING Vysya Bank is now known as Kotak Mahindra Bank. It received the goods on 12.11.2014 and issued a letter of acceptance of LC dated 12.11.2014. The complainant discounted the said letter of credit with the respondent and handed over the bill of exchange and other records with instructions to send the bill for payment to M/s ING Vysya Bank Ltd on or before 08.02.2015. The respondent credited a sum of Rs.38,32,152/- on 15.11.2015 after deducting the charges payable for discounting the letter of credit. Thereafter, the respondent debited a sum of Rs.40,85,254/- on 11.04.2015 without any valid reason. The complainant learnt that respondent had failed to send the requisite documents to ING Vysya Bank within the prescribed date. Complainant issued a legal notice to M/s Kotak Mahindra Bank ( previously known as ING Vysya Bank) inquiring about the actual date of receipt of letter of credit and other documents from the respondent and the bank disclosed that the documents were received after the expiry date i.e. on 19.02.2015 and hence the letter of credit was not honoured. When the legal notice was sent to the respondent, a vague reply was received from them. In the complaint, it was submitted that because of this act on the part of the respondent, the appellant had suffered not only huge monetary loss but also mental agony and that this act of the respondent also amounts to deficiency in service. They had suffered loss of Rs.40,85,254/- as a result of debiting the said amount from his account and sought credit of this amount in his account and claimed Rs.10.00 lakhs towards mental agony also.

(3.) The respondent while admitting all other contentions took the plea that they had sent the letter of discount to the concerned bank on 19.11.2014 by post and asked the Vysya bank to make the payment of the bills. On not receiving any payment from Vysya Bank, the appellant debited the amount in the Letter of Credit issued by the Vysya Bank and it is contended that there was no deficiency in service. It was also contended that the complainant had not made any effort to inquire from the Vysya Bank if they had remitted the money to respondent bank or not. On enquiry from Vysya Bank after expiry of period, they learnt that bill had not reached them and, thereafter, they dispatched the copy of bills to Vysya Bank. The respondent has also raised a plea that State Commission had no pecuniary jurisdiction and that the complainant was not a consumer.