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STATE BANK OF INDIA V. M/S B.S. AGRICULTURAL INDUSTRIES

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CITATION        AIR 2009 NSC 2210
DATE OF JUDGEMENT         20TH MARCH, 2009
COURT        SUPREME COURT OF INDIA
APPELLANT        STATE BANK OF INDIA
RESPONDENT        M/S B.S AGRICULTURAL INDUSTRIES
BENCH        D.K. JAIN, R.M. LODHA

INTRODUCTION:

 “State Bank of India v. M/S B.S Agricultural Industries” is yet another case which highlights the pivotal role played by the limitation period before filing a complaint. It is necessary to consider the limitation period by the consumer dispute redressal agencies even if it is not pleaded by parties. This case sheds light on the intrinsic element to be addressed by consumer forum before filling a complaint i.e. LIMITATION PERIOD. The issue arose when district, state and national consumer redressal commission directed appellant to pay a lump sum amount of Rs2,47,154 with interest at 15% per annum from 21st April, 1994 along with Rs5000 towards compensation. The judgment concurrently allowed the plea of appellant on ground of time-barred accusation which was supposed to be considered by all consumer redressal for a. 

FACTS OF THE CASE:

  1. The respondent M/s B.S Agricultural industries (Complainant) have been carrying on business of manufacturing and supply of engines and pump sets all over India via its distributers and dealers.
  2. It sent seven bills amounting Rs2,47,154 to the appellant (State Bank of India) which is drawn upon M/s Unique Agro Service, P.O. Heria, District Midnapore, along with GR’ s of transporters for collection of payment and remittance of proceeds to the complainant.
  3. The complainant gave two instructions to bank (1) To deliver the bills and GR’ s against the payment to the drawee and to charge 24% interest per annum from May 22,1994 in case M/s Unique Agro Service didn’t retire the bill within 30 days of presenting the bills (2) Further directed the bank to return the bill and GR’s if the drawee did not pay the bills within 45 days of presentation of the bills i.e. till June 7,1994. 
  4.  The Bank has informed the complainant in a letter dated March 28,1995 that it had returned the bills and GR’ s to B.M Konar (complainant’s sales manager) on May 10, 1994. The complainant in its letter dated May 4, 1996 had questioned the bank under what authority it had delivered the bills to B.M Konar and further it asked the bank to return the amount with interest or to deliver the documents.  
  5. The complainant had reminded the bank via letter on March 1, 1997 to which bank asked to forward a copy of the letter dated May 4, 1996 for necessary action.
  6. After several letters from complainant to bank dated March 15, 1995, May 4, 1996, March 1, 1997 and March 20,1997 and legal notice dated April 3, 1997, the Bank has neither sent the amount of Rs. 2,47,154/- nor returned the bills which mandated to raise a complaint before the district commission. 
  7. The district forum held that there was deficiency in service by the bank and directed it to pay Rs 2,47,154/- with interest @ 15% per annum from April 21, 1994 and Rs.5,000/- as compensation. The state commission affirmed the above order and the National Commission also upheld the order of district forum.

ISSUES IN HAND:

  1. Whether the complaint filed by the respondent is time barred as per limitation act?
  2. Whether the complainant was a consumer within the meaning of Consumer Protection Act, 1986?

CONTENTION OF APPELLANT:

  1. The appellant for the purpose of understanding the limitation period quoted section 24A of the Consumer Protection Act,1986 which follows as (1) the district, state or the national commission shall admit a complaint only if it is filed within 2 years from the date on which cause of action arises (2) the complaint can be entertained after the limitation period in sub-section (1) if the complainant satisfies the district, state or the national commission he had sufficient reason for not filing the complaint.
  2. The appellant contended that limitation period mandated in section 24A is peremptory in nature and the consumer forum needs to consider it before admitting a complaint.
  3. The appellant highlighted that the expression “shall not admit a complaint” is a legislative command and all the consumer forum in its own will has to examine whether the complaint is time barred or not and it is their undeniable duty.
  4. The appellant asserted that if the consumer forum decides the complaint on merit which is barred by time it amounts to illegality and hence the aggrieved party has the right to set aside such orders.
  5. The appellant argued that neither the district, state or the national commission had considered the preliminary objection raised by the appellant regarding the limitation period.
  6. Further affirmed its contention by submitting the letter dated on April 21, 1994 which expressly instructed the bank to return the documents if drawee did not retire the bill by June 7, 1994. Hence the limitation period starts from June 7, 1994 but the complaint was filed much later on May 5, 1997.
  7. The appellant maintained that through the letter dated March 28, 1995, the Bank had communicated to the complainant that the bills had been returned to B.M. Konar (Sales Manager of the complainant firm) on May 10, 1994 and the matter should be taken up with him (B.M. Konar).
  8. Further the complainant did not make any application for condonation of delay nor sufficient reason to be shown therefore the complaint is not to be entertained.

PRECEDENTS REFERRED:

  1. Union of India and Another v. British India Corporation Ltd. and Others, (2003) 

In this case the Court held that the question of limitation was a mandate to the forum and irrespective of the fact whether it was raised or not, the forum must consider and apply it.

  1. Haryana Urban Development Authority v. B.K. Sood, (2006)

The court reaffirmed the duty of all the consumer forum imposed under section 24A of the act that to dismiss the complaint unless reasonable reason for delay have been exhibited by the complainant. 

  1. Gannmani Anasuya and Others v. Parvatini Amarendra Chowdhary and Others, (2007) The court highlighted that it is the court which has to determine the limitation period of the suit even it is not pleaded by the parties and jurisdictional fact need not be even pleaded.

JUDGEMENT:

The Supreme court have opined that on its plain averments it is evident that the complaint is barred by time and ought to have been dismissed but astonishingly the district, state and national commission have neglected to consider it even though it was pleaded by bank.

The apex court held that the complaint is time barred as per the limitation period and it is liable to be dismissed further it would be unnecessary to examine other grounds of proceedings. Further allowed the appeal and has set aside the order of the national commission which upheld the orders of district and state commission.

CONCLUSION:

The case of “State Bank of India v. B.S Agricultural industries” holds a pivotal place in the consumer redressal as it reiterates the duties of consumer forum in admitting the complaints. Any consumer who intends to lodge a complaint has to recognized the limitation period to prove the merits of their case. The judgement of this case addresses the inevitable duty of the consumer forum in dismissing the time-barred suits which is not backed by reasonable cause.

This Article is written by Mahalakshmi. k of School of Excellence in Law (SOEL), intern at Legal Vidhiya.

Disclaimer: The materials provided herein are intended solely for informational purposes. Accessing or using the site or the materials does not establish an attorney-client relationship. The information presented on this site is not to be construed as legal or professional advice, and it should not be relied upon for such purposes or used as a substitute for advice from a licensed attorney in your state. Additionally, the viewpoint presented by the author is of a personal nature.

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