V.B Gupta, Presiding Member:— Present revision petition has been filed against order dated 27.7.2011, passed by State Consumer Disputes Redressal Commission, Panchkula (for short as ‘State Commission’) vide which appeal preferred by petitioner against order dated 18.3.2010, passed by District Consumer Disputes Redressal Forum, Panchkula (for short as ‘District Forum’) was dismissed.

2. Brief facts are that petitioner (complainant in the District Forum) was having overdraft facility from the respondent (OP in the District Forum) against the security in the shape of pledge of shares. A credit limit of Rs. 3 lacs was allowed by the respondent, after fair appraisal of all financial and legal aspects of the matter. It is alleged by the petitioner that as per last statement of account received by him, the normal transaction was made upto 29.10.2008 when a cheque of Rs. 2,400/- presented to the respondent was cleared by them. However, strangely a cheque of Rs. 6,600/- presented by the payee for payment in the account of the petitioner, was returned by the respondent without any notice on 29.10.2008 with the remarks “Insufficient funds”. Thus, respondent has acted unfairly and caused the sale of share at the lowest price on the intra day operations. It is further alleged that as per complete financial data of the market available on the website of the stock exchange, petitioner suffered a loss of Rs. 35,000/- due to the action of respondent, besides loss of interest @ 18% per annum. This act of the respondent has caused him great inconvenience, mental agony and suffering due to deficiency as well as sheer negligence of the respondent.

3. Respondent in its written statement has pleaded that the credit facility was (overdraft) against shares for Rs. 3 Lac but drawing power was allotted on the basis of market value of shares. As per terms of sanction, the petitioner had to maintain minimum margin of 50% on the market value of the shares. Respondent has sent specific notice to the petitioner on 19.09.2008 for deposit of overdrawn amount because of fall in the market value of shares to meet the stipulated margin of 50%.

4. It is further stated that respondent had sold the shares on 27.10.2008, as per details given therein to meet the margin requirement. Thus, after selling off some shares, respondent was able to clear the cheque of Rs. 2,400/-. After clearing the cheque of Rs. 2,400/- there was no funds to clear the cheque of Rs. 6,600/- and the same was returned by them. Further, in the 3 week of Oct., 2008, there was drastic fall in stock market and instead of depositing additional security, the petitioner withdrew Rs. 15,000/- on 25.10.2008 and his margin reached below trigger point and as such respondent rightly proceed with the sale of securities. Thus, there was no negligence and deficiency in service on the part of respondent.

5. District Forum vide its order dated 18-3-2010, dismissed the complaint of the petitioner.

6. It is contended by learned counsel for the petitioner that no application was given by the petitioner for reduction of his limit. Respondent on its own without giving any notice and without even contractual right being available to them under any law or contract, could not, to the determine and prejudice of the petitioner, arbitrarily reduce the credit limit and sell the shares pledged with them by the petitioner.

7. The entire action of the respondent of reduction without notice, of the duly sanctioned limit of the petitioner as well as further action of disposal of the shares by the respondent without notice to the petitioner, are tainted with patent illegality and are also not justifiable as per the norms of the Bank.

8. Lastly, it is contend that both Fora below have committed error in overlooking the statutory provisions in the Indian Contract Act, 1872, wherein Section 176 of the Act renders it mandatory for the Pawnee to serve a fair notice on the Pawnor before sale of the pledged goods.

9. District Forum while dismissing the complaint has held;

” The main question in this to be decided by this Forum is whether the opposite party could sell the shares of the complainant pledged by him in lieu of availing over draft facility of Rs. 3 lakhs from the OP Bank. In this regard we find that the complainant at the time of availing credit facility of Rs. 3 Lakhs has executed Agreement-Cum-Pledge-Cum-Guarantee (Ex. R-I) and further executed irrevocable power of attorney (Ex. R-2) in favour of the OP Bank according to which, OP Bank was authorized to deal with the securities pledged by the complainant and further authorized to transfer, sell or dispose off the said securities and for the purpose to endorse the same to sign and execute all transfer forms, delivery forms, declarations and other instrument's and writings as may be necessary or expedient for the purpose to give delivery thereof. Thus we find that no notice was required prior to selling the shares of the complainant pledged by him as a security with the OP bank. Moreover, we find that the OP bank had issued notice (Ex. R-3) on 19.9.2008 sent through courier vide receipt (Ex. R-3.A) stating that the value of the security by the complainant had fallen down and has resulted to short fall of margin of Rs. 9,843-08 paise as on 19.8.2008 and the complainant was called upon to provide additional security within 7 days from the date of this notice failing which bank would be entitled to sell, dispose of or realize any or all of the pledge security. However the complainant, denied having receipt letter. But we find that this letter was sent through courier on 19/9 on the address of the complainant given in the complaint and as such in the absence of any contrary evidence it would be it deemed to be received by the complainant. However, we find that despite that no action has been taken by the complainant as no additional security was provided to the opposite party within time given in the letter (Ex. R-3) rather the complainant withdrawn an amount of Rs. 15,000/- on 25/10/2008 due to which the margin reached below trigger point and the OP bank sold the securities i.e share pledged with the bank by the complainant on 27/10/2008, intimation of which was given to the complainant by the OP vide letter (Ex. C-2) dt. 29.10.2008

The complainant next contended that in order to cover up the loss he had offered collateral security of his son namely Varun. However, there is documentary evidence on the record to this effect and which date he offered such security. But this fact makes it clear that the demand of additional security by the OP was in knowledge of the complainant. However instead of providing additional security, further withdraw an amount of Rs. 15,000/- on 25.10.2008 due to which the margin reach below the trigger point and the OP sold the share of the complainant. Further we find the complainant claimed to have offered security of his son Varun, but Mr. Varun never offered any such security himself. The opposite parties took objections to this effect vide letter (Ex. C-3) dt. 24.12.2008 We find that the complainant/consumer cannot offer the security of third party for pledge without his consent and confirmation. Thus we find that the complainant has failed to offer any additional security to the OP Bank, failing which the opposite parties rightly sold his shares pledged with them as security. Thus we find no deficiency in service on part of the Opposite party”.

10. State Commission, while affirming the findings of the District Forum has observed;

“It has not been disputed that complainant has been allowed to avail cash credit limit of Rs. 3 lacs with security of pledge of shares. The value of shares keeps furcating and there was a time when stock market virtually crashed. It is allegation of complainant that OPs without any notice un-authorizedly sold the securities, which was in the shape of shares and thus dishonoured his cheque of Rs. 6,600/- with insufficient balance. The only argument raised on behalf of the appellant was that despite the fact that stock market crashed and value shares have fallen considerably still, it was incumbent upon the OP to have issued notice before disposing of the securities. This argument is contrary to the stand of complainant taken in the complaint. In Para No. 6 of the complaint, the plea raised was that additional security by pledge of shares of Mr. Varun was offered. Para No. 6 of the complaint is reproduced below:—

“That as the bare reference to the statement of account discloses that son of complainant Mr. Varun is also a joint account holder. As the facts bare out in the course of dealings the said Mr. Varun had also offered to pledge the security of the sufficient value to safeguard the opposite party's interest against the likely volatility related market losses. However, for the reasons best know to you, the said offer of Mr. Varun for providing additional security was not subjected to any fair consideration by opposite party apparently because at the relevant time you were duly secured as per the norms qua the credit facilities allowed by opposite party to complainant”.

Once, the complainant takes a stand that he had offered security in the shape of shares of Mr. Varun for which no evidence was led, the argument that the bank has a sufficient security in the shape of shares is contrary to his own stand. There is another aspect also, it is own case of complainant that he has been enjoying the cash credit limit by pledge of shares for trading in the shares. However, since complainant in his complaint itself has mentioned that he has been trading in the shares, which is a commercial transaction, he did not fall within the ambit of consumer. The regular trading in purchase and sale of shares being commercial transaction and the purchase being to earn profit, thus the end result being commercial transaction, complaint was not maintainable”.

11. Short question which arises for consideration is as to whether petitioner comes within the ambit of a ‘consumer’ as defined under the Consumer Protection Act, 1986 (for short as ‘Act’).

12. Expression ‘consumer’ has been defined in Section 2(1)(d) of the Act, which reads as under;

“d “Consumer” means any person who,—

(i) buys any goods for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any user of such goods other than the person who buys such goods for consideration paid or promised or partly paid or partly promised, or under any system of deferred payment, when such use is made with the approval of such person, but does not include a person who obtains such goods for resale or for any commercial purpose; or

(ii) hires or avails of any services for a consideration which has been paid or promised or partly paid and partly promised, or under any system of deferred payment and includes any beneficiary of such services other than the person who hires or avails of the services for consideration paid or promised, or partly paid and partly promised, or under any system of deferred payment, when such services are availed of with the approval of the first mentioned person but does not include a person who avails of such services for any commercial purpose;

Explanation——— For the purpose of this clause, “commercial purpose” does not include use by a person of goods bought and used by him and services availed by him exclusively for the purposes of earning his livelihood by means of self-employment”.

13. As per averments made in the Paras 3 and 4 of the complaint, it is manifestly clear that petitioner has been trading in the business of shares. These Paras read as under;

“3. That complainant was in the normal manner availing the said duly sanctioned credit limit which was covered by the security of adequate value of shares in your hands. Complainant was reluctant to sell those shares when the market had literally collapsed. The intention of complainant was to hold the said shares with a long term investment perspective.

4. That as per the last statement of account received by the complainant it is disclosed that the normal transaction in the account was made by complainant upto 29th October, 2008 when a cheque of Rs. 2,400/- of complaint presented to opposite party for payment was cleared by opposite party. It needs to be clarified that upto the said date i.e 29th October, 2008 the operation in the account was regular, normal and without any adverse notice to the complainant”.

14. Petitioner has nowhere pleaded in its entire complaint that he is doing share trading business as “self-employment for livelihood”. Nor it has been alleged that the services provided by the respondent, were being availed of exclusively for the purpose of earning of his livelihood by means of self-employment by the petitioner. Dispute between the parties relating to commercial purposes are excluded under the Act.

15. Since, petitioner has been trading regularly in the shares which is a commercial transaction and for which he has also availed the “over draft facility” from the respondent, as such he would not be a consumer as per Section 2(1)(d)(ii) of the Act. Moreover, regular trading in the purchase and sale of the shares is a commercial transaction and the only motive is to earn profit. Thus, this activity is purely commercial one and is not covered under the Act. There are concurrent findings of facts also with regard to the service of the notice upon the petitioner.

16. Present revision petition has been filed under Section 21(b) of the Act. It is well settled that powers of this Commission as a Revisional Court are very limited and have to be exercised only, if there is some prima facie jurisdictional error in the impugned order.

17. Hon'ble Supreme Court in Mrs. Rubi (Chandra) Dutta v. United India Insurance Co. Ltd., 2011 (3) Scale 654 has observed;

“Also, it is to be noted that the revisional powers of the National Commission are derived from Section 21(b) of the Act, under which the said power can be exercised only if there is some prima facie jurisdictional error appearing in the impugned order, and only then, may the same be set aside. In our considered opinion there was no jurisdictional error or miscarriage of justice, which could have warranted the National Commission to have taken a different view than what was taken by the two Forums. The decision of the National Commission rests not on the basis of some legal principle that was ignored by the Courts below, but on a different (and in our opinion, an erroneous) interpretation of the same set of facts. This is not the manner in which revisional powers should be invoked. In this view of the matter, we are of the considered opinion that the jurisdiction conferred on the National Commission under Section 21(b) of the Act has been transgressed. It was not a case where such a view could have been taken by setting aside the concurrent findings of two fora”.

18. Thus, no jurisdiction or legal error has been shown to us to call for interference in the exercise of power under section 21(b) of the Act, since, two fora below have given cogent reasons in their orders, which does not call for any interference nor they suffer from any infirmity or revisional exercise of jurisdiction.

19. It is not that every order passed by the Fora below is to be challenged by a litigant even when the same is based on sound reasoning.

20. Under these circumstances, present petition is without any legal basis and is merit-less. Accordingly, the same is hereby dismissed with costs of Rs. 10,000/- (Rupees Ten Thousand only).

21. Petitioner is directed to deposit the costs of Rs. 10,000/- (Rupees Ten Thousand Only) by way of a cross cheque in the name of “Consumer Legal Aid Account” within four weeks from today.

22. In case, costs are not deposited within the prescribed period, then petitioner shall be liable to pay interest @ 9% p.a, till realization.

23. List on 30 March, 2012, for compliance.