Consumer Protection Act, 1986 – s.2 (1)(d)(ii) – Definition of ‘Consumer’ – Borrower of project loan, if falls within the definition of ‘Consumer’ – Maintainability of the consumer complaint – Respondent-advertising and branding company defaulted on a project loan availed from the appellant-Bank for engaging in the post production of a movie – Initiation of proceedings, One Time Settlement between the parties and thereafter, issuance of No-Dues Certificate to the respondent and full-satisfaction memo filed before the DRT – However, the Bank incorrectly reported the name of the respondent to Reserve Bank of India as a defaulter with outstanding loan amount which caused loss of goodwill and reputation, and resulted in the respondent losing an exclusive advertising tender/license – Consumer complaint by the respondent alleging negligence and deficiency in service on part of the appellant – National Commission partly allowed the complaint and directed the Bank to pay compensation to the respondent – Sustainability: Held: Respondent is not a ‘consumer’ under the Act – Plea that post-production of a movie was a self-branding exercise, the sole purpose being building a brand name for the respondent in order to earn livelihood, thus no nexus to generation of profits, not convincing since the dominant purpose behind brand building itself was to attract more customers and consequently generate profits or increase revenue for the business – Fundamental nature of the transaction, availing of credit facility from Bank which was purely business-to-business transaction entered into for commercial purpose, not altered – Transaction of obtaining a project loan had a close nexus with a profit-generating activity and the dominant purpose for getting the loan sanctioned was to generate profits upon successful post-production of the movie – Order passed by the National Commission set aside. [Paras 16, 18, 21]
As published in the Supreme Court Reports, Supreme Court of India. Headnotes prepared by: Nidhi Jain. Text from the Indian Supreme Court Judgments open data set (Dattam Labs), CC BY 4.0.
This page is for informational and research purposes only and does not constitute legal advice. Consult a qualified advocate for advice specific to your situation.