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have been raised in the written statement by the opposite party. It has been stated
that the complainant has alleged fraud and forgery in various transactions, which have
resulted in the loss to the complainant. The cases of forgery and fraud cannot be
looked into by a consumer forum, therefore, the complaint needs to be made before
the competent court of civil jurisdiction. Moreover, the complaint has been filed for
recovery of the money from the opposite party and therefore, only a recovery suit can
be filed against the opposite party before a competent civil court. Moreover, an (FIR
No. 466 of 2015) under Section 420, 407,467, 468 and 471 of IPC, against Mr. Sachin
Jain has been filed in the matter by the complainant and already after investigation a
charge-sheet has been filed by the police before the competent criminal court and the
matter is subjudice there. On the basis of these preliminary objections it has been
requested to dismiss the complaint.
5. Both the parties have filed their evidence by way of affidavit, which have been
taken on record.
6. Heard the learned counsel for both the parties and perused the record. Learned
counsel for the complainant reiterated the facts of the case as mentioned above and
stated that the account is in the name of the school, which is being run by the
Charitable Education Society. It was further stated that the opposite party bank is
taking the shelter under the fact that the records have been taken away by the police
for investigation and they are part of the criminal case, which is pending before the
competent criminal court. This stand of the opposite party is not tenable because the
opposite party should have kept full one set of all the documents, which were given to
the police for their own record and they should have given specified reply for each of
the cheques mentioned in the complaint. In a complaint case if proper reply is not
given for an allegation, then, the case of the complainant stands automatically proved.
Thus, the opposite party cannot get any benefit for their own wrong and the case of
the complainant needs to be decided in favour of the complainant.
7. It was further stated by the learned counsel for the complainant that the
opposite party has taken a stand that the complainant is not a consumer as the school
is charging fees from the students. It was stated that the school is run by a Charitable
Education Society and therefore, no question of profit is involved, rather, society is
shouldering the expenses of their school to a great extent. A charitable society is not
meant for earning profit and therefore, is a consumer within the meaning of Section 2
(1)(d) of the Consumer Protection Act, 1986. In respect of this argument, learned
counsel referred to the case of Hon'ble Supreme Court in Lourdes Society Snehanjali
Girls Hostel v. H&R Johnson (India) Limited, (2016) 8 SCC 286, where it has been held
that:—
17. ……….The National Commission has reversed the order passed by the State
Commission by wrongly applying the decision of M/s Kusumam Hotels Pvt. Ltd. case
(supra) to the set of facts in the present case. In the said case, the complainant
was a hotel, it was considered to be a commercial entity and therefore, it was kept
out of the purview of the definition of ‘consumer’ under Section 2(1) (d) of the
Consumer Protection Act, 1986. However, the National Commission has failed to
appreciate the fact that in the present case, the appellant-Society is not a
commercial establishment rather a registered society helping the adivasi students
in their education by providing hostel facilities. The charges, if any, for
accommodation in the hostel are for maintaining the hostel and not for making
profit. Thus, the appellant-Society is consumer within the meaning of the term
‘consumer’ under Section 2(1)(d) of the Consumer Protection Act, 1986. The
National Commission has erroneously accepted the contention urged on behalf of
the respondents in the revisional proceedings that supply of tiles to the appellant-
Society by respondent no. 1 through its local agent is for commercial purpose. The
said finding is based on the decision in M/s Kusumam Hotels Pvt. Ltd. case (supra),
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was data entry error for cheque number for Rs. 35,000/- wherein the cheque number
was entered as 110027 in place of 110026. Both the cheques were made payable to
the bearer and were otherwise in order. The allegations of fraud, forgery, cheating and
conspiracy by the complainant are pending adjudication before the appropriate courts.
Learned counsel stated that as the charge-sheet has already been filed in the matter
and the case is to be decided, no liability can be fixed on the bank for wrong payment
if any. It was further stated by the learned counsel that this matter involved
complicated questions of facts and law, which cannot be decided in the summary
proceedings before this Commission and the right forum for this complaint is civil
court where the voluminous evidence can be produced and examined, as this matter
involves voluminous evidence for each cheque as both the parties will be adducing
evidence in respect of their stands.
13. I have given a thoughtful consideration to the arguments advanced by the
learned counsel for the parties and perused the record. The complainant has stated in
its complaint that complainant is a Charitable Institution and running several schools
in Delhi and NCR. It has been stated that the complainant opened account for their
school namely, IPGS, Noida with the opposite party bank. The account is being
operated by the society and therefore, I find no merit in the objections of the opposite
party bank that the complainant does not have any privity of contract with the bank.
Further it is seen that the account is a current account being operated by the society
officers and therefore, society claims that it is a consumer of the opposite party bank.
As the complainant is a Charitable Institution, and is not involved in any profitable
activity and therefore, relying upon the case of Hon'ble Supreme Court in Lourdes
Society Snehanjali Girls Hostel v. H&R Johnson (India) Limited (supra), I find that
complainant is a consumer under Section 2(1)(d) of Consumer Protection Act, 1986.
14. Now coming to the merits of the case, it is seen that the complainant has
alleged in para 6 of the complaint that Rs. 1,50,000/- has been withdrawn on the
basis of cheque No. 110004, whereas the cheque is lying unused with the
complainant. The opposite party bank in their written statement has not given any
satisfactory reply rather, it has been only said that the “contents are denied.” It has
also been narrated in the reply against this para that the accountant of the
complainant has confessed the guilt and the matter is pending before the criminal
court. Similarly, against the allegation for cheque no. 110027 that this cheque was
drawn for Rs. 35,000/-, whereas Rs. 3,50,000/- has been paid against this cheque,
the opposite party bank has admitted this fact in the written statement, however, it
has been alleged that this is due to faulty data entry.
15. From the above, it is clear that Rs. 1,50,000/- has been withdrawn against the
cheque No. 110004, whereas this cheque has not yet been used and is lying with the
complainant. This is a clear deficiency on the part of the bank. Thus, the bank is liable
to return the payments made against this cheque. Clearly the bank is liable to return
Rs. 1,50,000/- to the complainant.
16. So far as cheque no. 110027 for Rs. 35,000/- is concerned, the opposite party
has stated that the entry has been exchanged between cheque no. 110027 and
110026. Neither opposite party nor the complainant has submitted anything about
cheque no. 110026 and therefore, the version of the opposite party cannot be
apparently accepted. Hence, payment of this cheque is also shrouded in fraud and
forgery.
17. The complainant has also made a complaint about withdrawal of Rs. 1,50,000/-
from the complainant's account, however, no details of this withdrawal have been
given. Even the cheque number has not been given. In reply the opposite party has
also not stated anything about this payment rather, it has been stated that the matter
is pending before the criminal court and the original records have been taken away by
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the police. No specific reply has been given for this withdrawal. Clearly, this
withdrawal is also shrouded in fraud and forgery.
18. So far as other allegations of the complainant are concerned, they relate to
payments of several cheques by the opposite party bank wrongly and fraudulently. It
has been stated that an amount of Rs. 5,50,000/- has been fraudulently withdrawn
from eight cheques (within the period from 8.11.2014 to 31.7.2015). It has been
alleged that these cheques have not been issued by the complainant. It has been
further alleged that an amount of Rs. 4,12,365/- has been withdrawn illegally by way
of 18 cheques. These cheques are in the name of the employees of the complainant.
However, the complainant has alleged that the employees have not encashed these
cheques. It has been alleged that Rs. 60,11,500/- has been withdrawn in cash by
using 24 cheques which were neither issued by the complainant nor signed by the
complainant. It has been further alleged in the complaint that there is no identification
mentioned at the reverse of these cheques as to who has received the payments of the
cheques. The opposite party has not given any details of the persons to whom these
payments have been made. Veracity of these cheques and their payments can only be
established after having detailed examination of these cheques from the record of the
bank which are not available on record for any examination. Moreover, fraud and
forgery have been alleged in respect of these cheques by the complainant and a
consumer forum is not competent to decide the cases where fraud and/or forgery is
involved in an extensive manner.
19. It is seen that there is no merit in the assertion of the opposite party that the
complainant is not a consumer as the complainant is holding this account for
commercial purpose. So long as, the complainant is a beneficiary of the account holder
and all the account holders of a bank are the consumers as held by this Commission in
State Bank of India v. Pushapakala, R.P. No. 2343 of 2013, decided on 11.11.2016,
wherein following has been observed:—
“11. The first point that requires consideration in the matter is whether the
complainants fall under the definition of ‘consumer’ as per section 2(d) of the
Consumer Protection Act, 1986. The petitioner Bank have taken the plea that being
applicants for the allotment of shares of a Company, the complainants did not come
under the definition of ‘consumer’, as stated in the judgments relied upon by them
and as brought out in the order passed by the District Forum. In the present case,
the complainants are maintaining a regular savings bank account with the OP Bank
since 2005, and the said fact has not been denied by them. It is clear, therefore,
that they have been availing themselves of the services provided by the Bank and
hence, they are consumers vis-a-vis the Bank. The present case involves the
dishonour of a cheque on the ground that the signatures on the said cheque did not
tally with the signatures maintained by the Bank. In this kind of situation, it is
evident that the purpose for which the cheque was issued, does not carry any
relevance, rather the main issue is whether the cheque was dishonoured in a
rightful manner or not. An account holder having a savings bank account may issue
a cheque for any purpose, whether commercial or non-commercial. It would not be
fair to conclude that if the cheque was issued for a non-commercial purpose, the
savings bank account holder will be branded as a consumer, but if the cheque is for
commercial purpose, he will not come under the category of consumer. This will
obviously be quite an absurd situation. It is held, therefore, that since the
complainants were joint holders of a savings bank account with the Bank, they are
definitely covered under the definition of consumer vis-a-vis the Bank”.
20. This Commission has taken a consistent view that the cases related to fraud
and/or forgery cannot be decided by the consumer forum as the proceedings in
consumer forum are summary in nature. This Commission has held in the following
case that the matter relating to fraud and forgery cannot be decided under the
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cheques are involved. Thus, this complaint involves complicated questions of facts and
law and voluminous evidence would be required to reach to any conclusion and the
same is not possible under the summary proceedings under the Consumer Protection
Act, 1986. In a case of fraudulent cheque withdrawals, this Commission recently in the
matter of The Tax Publisher v. Chairman & Managing Director, UCO Bank, FA No. 106
of 2014, decided on 31.08.2017 (NC)., has although accepted the deficiency on the
part of the bank, but has simultaneously observed:—
“12. In CCI Chambers Coop. Hsg. Society Ltd. (supra) the Hon'ble Supreme
Court highlighted the same principle as enunciated in Dr. J.J. Merchant (supra) to
determine the question whether adjudication on the issue arising in the Complaint
require a detailed and complicated investigation of facts, incapable of being
undertaken in a summary and speedy manner. It was observed that the decisive
test is not the complicated nature of the questions of fact and law arising for
decision — the anvil on which entertainability of a complaint by a Forum under the
Act is to be determined is whether the questions, though complicated they may be,
are capable of being determined by summary enquiry i.e. by doing away with the
need of detailed and complicated method of recording evidence.”
24. From the above, it is clear that when the questions of facts and law are not
determinable in the summary proceedings under the Consumer Protection Act 1986,
the consumer forum may treat complaint as non-maintainable before it. In the above
referred case there were only two cheques involved in the matter. However, in the
present case there are more than 50 cheques involved totalling to more than Rs.One
Crore. From the enormity of canvas of the complaint involving huge number of
transactions through forged cheques, this can be easily understood that adjudication
of this complaint would involve enormous evidence which would not be possible in the
summary proceedings under the Consumer Protection Act, 1986 before this
Commission.
25. From the above examination, it is quite clear that the matter in the present
complaint except for the cheque No. 110004 involves fraud and forgery, which are
beyond the scope of examination in the proceedings under the Consumer Protection
Act, 1986 in the present set of facts and circumstances. Looking at the huge amount
involved and the number of transactions being more than 50 involving forged cheques,
the examination of this complaint would involve voluminous evidence and the same is
not possible under the summary proceedings before this Commission.
26. On the basis of above discussion, the following order is passed:—
ORDER
(a) The complaint only in respect of cheque No. 110004 is allowed and the opposite
party Axis Bank is directed to pay Rs. 1.50 lacs to the complainant along with
9% p.a. interest from the date of payment of this cheque till actual payment to
the complainant.The opposite party shall also pay a litigation cost of Rs. 25,000/-
(rupees twenty five thousand only) to the complainant.The opposite party may
transfer the awarded amount in the account of the school if the account still
exists.
(b) For rest of the complaint, I have reached to the conclusion that the transactions
involve fraud and forgery right from the stage of issuance of the cheques to the
stage of payment of these cheques to unidentifiable persons. It has been already
found that this Commission cannot entertain this remaining complaint where the
allegations are based on fraud and forgery. Accordingly, the remaining complaint
is dismissed as not maintainable before this Commission. However, the liberty is
granted to the complainant to approach the civil court having jurisdiction to
decide the complaint for redressal for the grievances. The complainant shall be
entitled to get benefit of Section 14 of the Limitation Act, 1963 for the period of
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pendency of this complaint before this Commission i.e. from 30.01.2017 till
disposal of this complaint by this Commission.
———
†
New Delhi Bench
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