Unity & Trust Society Vs. Chairman & Managing Director  INSC 102
(31 January 1995)
R.M. (J) Sahai, R.M. (J) Kuldip Singh (J) Mohan, S. (J)
1995 SCC (2) 150 JT 1995 (2) 51 1995 SCALE (1)387
Judgment of the Court was delivered by R.M. SAHAI, J.- The short question that
arises for consideration in this appeal directed against judgment of National
Consumer Disputes Redressal Commission, New Delhi, is whether a banking company
which renders service within meaning of clause (g) of Section 2 of the Consumer
Protection Act, 1986 (referred in brief as "the Act") is liable to
compensate its customers for loss of service due to illegal strike by its
for the strike due to enforcement of scheme of transfer by the Bank and its
being illegal due to employees resorting to it during pendency of conciliation
proceedings before the Commission have not been assailed in this appeal.
the finding that the Bank was prevented from rendering any skeleton service to
its customers due to unruly behaviour of the employees who not only created
barricades by forming human wall before the Bank but even mutilated and defaced
the signature on cheques issued by the Bank to cater to urgent demands of its
customers by colluding with employees of Reserve Bank of India is well-founded
and unassailable. But what was argued was that since the customers of the Bank
were deprived of the services due to strike for 54 days, the Bank was liable to
pay such amounts as, "(a)Interest on overdrafts accounts to be reimbursed
at lending rate during the period the account was not operative.
Reimbursement of interest at the lending rate less actual rate of interest
creditable to the saving deposit account holders.
Interest at the lending rate on the negotiable instruments held in suspense
during this period to be reimbursed to the customers.
Reimbursement of interest at which the customers may have borrowed money from
elsewhere to meet with their exigencies for the period during which they could
not lay hands on their own money lying stuck in or due to the Bank.
Reimbursement of wharfage, demurrage and such other costs on consignments,
documents of which were lying in the Bank or could not be delivered to the Bank
during this period and the related period before and after this strike.
(f) Such consequential damages and losses incurred by the customers resultant
of the strike, including compensation for mental and physical anguish and agony
caused due to non- availability of the money or against a limit/loan or
overdraft facility with the Bank.
Such other losses and claims, which may arise out of the actual claims to be
lodged by the customers and/or assessed for the strike period after making
'thorough assessment through an independent agency'." To determine merits
of this submission, it is necessary to advert to certain provisions of the Act.
A consumer or any registered voluntary consumer association, like the
appellant, is entitled to file a complaint, as provided in sub-clause (iii) of
clause (c) of sub-section (1) of the Act for deficiency in service. 'Service'
has been defined in clause (o) of Section 2 of the Act and reads as under:
service' means service of any description which is made available to potential
users and includes the provision of facilities in connection with banking,
financing, insurance, transport, processing, supply of electrical or other
energy, board or lodging or both, housing construction, entertainment,
amusement or the purveying a news or other information, but does not include
the rendering of any service free of charge or under a contract of personal
service;" The expression "any description" widens the ambit of
the section and extends it to any service. Therefore, payment of interest on
overdrafts, interest at lending rate, wharfage, demurrage etc. claimed by the
appellant may be covered in the expression 'service'. But 'deficiency' in
service has been defined in clause (g) of Section 2 of the Act as under:
'deficiency' means an),, fault, imperfection, shortcoming or inadequacy in the
quality, nature and manner of performance which is required to be maintained by
or under any law for the time being in force or has been undertaken to be
performed by a person in pursuance of a contract or otherwise in relation to
any service;" Even though the depositors were deprived of the service of
the Bank but the deficiency did not arise due to one of the reasons mentioned
in clause (g). The shortcoming in he service by the Bank did not arise due to
failure on the part of the Bank in performing its duty or discharging its
obligations as required by law. Since the depositors were prevented to avail of
the services of the Bank not because of any deficiency on the pan of the Bank
but due to strike resorted to by the employees who almost physically prevented
the Bank from functioning, the failure of the Bank to render service could not
be held to give rise to claim for recovery of any amount under the Act.
Further, the power and jurisdiction of the Commission is to award compensation
under Section 14(1)(d) of the Act as it has been made applicable to the
Commission by sub-rule- (b) of Rule 19 of the Rules framed under the Act.
Clause (d) of sub-section (1) of Section 14 is extracted below:
"to pay such amount as may be awarded by it as compensation to the
consumer for any loss or injury suffered by the consumer due to the negligence
of the opposite party." Each of these expressions used in the sub-section
are of wide connotation and are fully comprehended both in common and legal
sense. Negligence is absence of reasonable or prudent care which a reasonable
person is expected to observe in a given set of circumstances. But the
negligence for which a consumer can claim to be compensated under this
sub-section must cause some loss or injury to him. Loss is a generic term. It
signifies some detriment or deprivation or damage. Injury too means any damages
or wrong. It means "invasion of any legally protected interest of
the provisions of Section 14(1)(d) are attracted if the person from whom
damages are claimed is found to have acted negligently and such negligence must
result in some loss to the person claiming damages. In other words, loss or
injury, if any, must flow from negligence. Mere loss or injury without
negligence is not contemplated by this section. The Bank has not been found to
be negligent in discharge of its duties. Therefore, even if any loss or damage
was caused to any depositor but it was not caused due to negligence of Bank
then no claim of damages under the Act was maintainable.
these reasons, the appeal fails and is dismissed.
there shall be no order as to costs.