http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 1 of 3  

PETITIONER: CONSUMER UNITY & TRUST SOCIETY

       Vs.

RESPONDENT: CHAIRMAN & MANAGING DIRECTOR

DATE OF JUDGMENT31/01/1995

BENCH: SAHAI, R.M. (J) BENCH: SAHAI, R.M. (J) KULDIP SINGH (J) MOHAN, S. (J)

CITATION:  1995 SCC  (2) 150        JT 1995 (2)    51  1995 SCALE  (1)387

ACT:

HEADNOTE:

JUDGMENT: The 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 employees. 2.Reasons  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. Even 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.               (b)   Reimbursement of interest at the lending               rate  less actual rate of interest  creditable               to the saving deposit account holders.               (c)   Interest  at  the lending  rate  on  the               negotiable instruments held in suspense during               this period to be reimbursed to the customers.               (d)   Reimbursement  of interest at which  the

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 2 of 3  

             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.               (e)   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.               152               (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.               (g)   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

http://JUDIS.NIC.IN SUPREME COURT OF INDIA Page 3 of 3  

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: 153               "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  another". Thus 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. 3.For  these reasons, the appeal fails and is  dismissed. But there shall be no order as to costs. 155