RAYTHARA SAHAKARI BANK LTD.versusCHANDRAKALA R. DAS

                   RA YTHARA SAHAKARI BANK LTD.                                 A
                                v.
                        CHANDRAKALA R. DAS

                            NOVEMBER 8, 2006

                [ARIJIT PASA YAT AND S.H. KAPADIA, JJ.]                         B


      Indian Contract Act, 1872:

      Complainant and others took loan from Bank by pledging jewellery-
Jewel/ery stolen from the Bank-Bank fixing certain rate in return of the C
value of the jewellery stolen-Rate so f1Xed accepted by all the borrowers
except the complainant-Complainant demanding higher rates-District
Consumer Forum directed upward revision in the rate-Affirmed by State
Commission-Revision petition dismissed by National Commission-On
appeal, Held: Both the State Commission and the National Commission D
passed cryptic orders-They failed to discuss about the effect of the stand
taken by the Bank on complainant/Borrowers-Hence, order of the
Commission set aside and matter remitted to the National Commission for
consideration afresh-Directions issued.

       The respondent-Complainant availed jewel loans from the appellant- E
Bank by pledging gold ornaments. The gold ornaments kept in the Bank were
stolen. An FIR was lodged at the police station and a criminal trial is pending.
The appellant-Bank, with a view to return value of the gold ornaments so
pledged, convened a meeting of all the borrowers and resolved that in lieu of
stolen jewellery, each of them shall be paid at the rate of Rs. 410/- per gram,
the prevailing market rate of gold at the time of the theft. It was also resolved F
that no interest would be charged on all such jewel loans. One of the borrowers
issued a notice to the Bank demanding higher rates for the gold ornaments
pledged. Later, he filed a complaint before the District Consumer Disputes
Redressal Forum seeking for direction to the Bank to make payment at the
rate of Rs. 573/- per gram for the stolen jewellery along with making charges G
and compensation for non-delivery of gold ornaments and litigation expenses.
The District Forum allowed the petition. On appeal, the State Forum held that
there was no illegality or irregularity in the order of the District Forum.
1'\\~ nvisi()n pttition filed before the National Commission was dismissed.

                                     751
                                                                                H
    752                     SUPREME COURT REPORTS [2006] SUPP. 8 S.C.R.                  ~


A   Hence the present appeal.

          The appellant contended that neither the State Commission nor the
    National Commission considered the effect of the resolution passed by the
    Bank fixing the rate per gram of the gold for the purpose of making payment
    to the customer/borrowers of Loan; and that no other complaint has been
B   lodged, but taking advantage of the order passed by the District Forum as
    upheld by the State Commission and the National Commission, large number
    of people would prefer to reopen the matter.

          Partly allowing the appeal, the Court
       HELD: It is not clear as to whether the complainant had attended the
c meeting which was convened and where all the borrowers were given the
    chance to participate. The decision in the meeting undisputedly was to the
    effect that the value of gold on the date of theft was to be paid. It appears that
    there was no other complaint except the one under consideration. Both the
    State Commission and the National Commission passed cryptic orders and
D   did not discuss even the various stands taken by the appellant-Bank. .It was
    open to the State Commission and the National Commission to consider the
    stand relating to acceptance of rate fixed at the meeting and its effect on the
    complainant's claim. But, that has not been done. Hence, the order of the
    National Commission is set aside and the matter is remitted to it for fresh
    consideration for the purpose of considering the effect of the decision taken
E   by the Bank and accepted by about 400 similarly situated borrowers.
                                                                           (754-E-F-G]
          CIVIL APPELLATE JURISDICTION : Civil Appeal No. 4724 of2006.                   ''

         From the final Judgment and Order dated 16.11.2004. of the National
    Consumer Disputes Redressal Commission, New Delhi in Revision Petition
F   No. 2292 of2004.

          V.N. Raghupathy for the Appellant.

          Varinder Kumar Sharma for the Respondent.

G         The Judgment of the Court was delivered by

          ARIJIT PASAY AT, J. Leave granted.

         Appellant calls in question legality of the order passed by the National
    Consumer Disputes Redressal Commission, New Delhi (in short the 'National
    Commission') summarily dLmissing the Revision Petition filed by the appellant-
H   Bank observing that the short order passed by the State Consumer Dispute
        RAYTHARA SAHAKARI BANK LTD. v. CHANDRAKALA R. DAS [PASAYAT,J.)    753

Redressal Commission, Bangalore, Karnataka (in short the 'State Commission') A
is absolutely clear and needs no interference.

      Background facts giving rise to the present appeal in a nutshell are as
follows:

        The respondent, (hereinafter referred to as the 'complainant') availed B
jewel loans from the appellant-Bank by pledging gold ornaments on different
 dates in August 2000, February 2001, April 2001, May 2001 and June 2001.
 Appellant-Bank insured gold ornaments kept in the locked iron safe of the
 Bank for a sum of Rs. 25,00,000/- with United India Insurance Company
 Limited. On 4.8.2001 a huge quantity of gold ornaments including those C
 pledged by the complainant with the Bank, were stolen. Infonnation was
 lodged at the police station and a criminal trial is pending. On 1.10.2003 the
 appellant-Bank submitted its claim to the Insurance Company but the same
 was repudiated. On 17 .1.2004, the appellant-Bank, with a view to return value
 of the gold ornaments of the pledges convened a meeting where more than
 400 persons, who were jewel loan borrowers and authorities of the cooperative D
 societi'es were present. It was resolved that each person who had pledged
 ornaments shall be paid at the rate of Rs. 4 I 0/- per gram which was the
 prevailing market rate at the time of theft. It was also resolved that no interest
 shall be charged on all such jewel loans. Complainant issued a notice to the
 Bank demanding higher value for the gold ornament pledged. Appellant-Bank
 requested the complainant to accept the rate fixed on the basis of Resolution E
 dated 17 .1.2004. On 8.3 .2004 the complainant filed a complaint before the
 District Consumer Disputes Redressal Forum, Udupi (in short 'District Forum')
 with a prayer for a direction to the appellant-Bank to pay the entire amount
 with upto date interest in respect of six jewel loan accounts and to pay
 present market rate of gold at the rate of Rs.573/- per gram along with making p
charges anJ a compensation for non-delivery of gold ornaments amounting
to Rs. 25,000/- and litigation expenses of Rs. 10,000/-. On 28.5.2004, the
appellant-Bank filed its statement of defence and denied its liability to pay the
amount with interest. There was no default of service and non-delivery of the
jewel was on account of the admitted theft in the Bank for which criminal case
has been instituted and insurance claim has been lodged. Subsequently, the G
appellant-Bank filed an affidavit before the District Forum stating that it is
willing to pay at the rate fixed for all the jewel loan borrowers. The District
Forum held that the value of the gold was to be computed at the rate of Rs.
573/- per gram which was the claim, though the price of gold prevailing on
the date of order was Rs. 593/- per gram. Accordingly, it was held that value H
    754                      SUPREME COURT REPORTS [2006) SUPP. 8 S.C.R.

A of gold payable was Rs. 67,041/-. Appellant preferred an appeal before the
    State Forum which by a short order held that there was no illegality or
    irregularity in the order of the District Forum and ifthere was any insurance
    policy covering the theft, it was open to the appellant-Bank to lodge a claim
                                                                                       .....
    and pursue the remedy available. The revision petition filed before the National
B   Commission as noted supra was dismissed.

          In support of the appeal, learned counsel for the appellant submitted
    that neither the State Commission nor the National Commission considered
    the effect of the decision taken on 17 .1.2004 in a meeting where more than
    400 borrowers had accepted the rate. No other complaint has been lodged,
C   but taking advantage of the order passed by the District Forum as upheld by
    the State Commission and the National Commission, large number of people
    are trying to reopen the matter.

          Learned counsel for the respondent supported the order of the Forums
    and submitted that a realistic view has been taken by the District Forum which
D   was upheld by the State Commission and the National Commission.

           We find tha! all through stand of the appellant-Bank has been that all
    the borro·;'ers except the respondent have accepted the rate arrived at
    consensually at the meeting. The complainant cid not dispute that such a
    decision had been taken. It is not clear as to whether the complainant had
E   attended the meeting which was convened and where all the borrowers were
    given the chance to participate. The decision in the meeting undisputedly was
    to the effect that the value nf gold on the date of theft was to be paid. It
    appears that there was no other complaint except the one under consideration~
    Both the State Commission and the Na~ional Commission passed cryptic
F   orders and did not discuss even the various stands taken by the appellant.
    It was open to the State Commission and the National Commission to consider
    the stand relating to acceptance of rate fixed at the meeting and its effect on
    the complainant's claim. But, that has not been done. We, therefore, set aside
    the ord-.:r of the National Commission and remit the matter to it for fresh
    consideration for the purpose of considering the effect of the decision taken
G   on 17.1.2004 where about 400 similarly situated borrowers had accepted the
    rate. We make it clear that we have not expressed any opinion on the merits
    of the case.

             Appeal is allowed to the aforesaid ex~ent with no order as to costs.

H   S.K.S.                                                  Appeal partly allowed.