The Ratnakar Bank Ltd., Regd. Office Kolhapur Vs. M/S. Neliton Systems Ltd., Mumbai - Court Judgment

SooperKanoon Citationsooperkanoon.com/1111210
CourtMaharashtra State Consumer Disputes Redressal Commission SCDRC Mumbai
Decided OnAug-17-2009
Case NumberConsumer Complaint No.2 of 1999
JudgeMr. S.R. Khanzode, Hon’ble Presiding Judicial Member Smt. S.P. Lale, Hon’ble Member
AppellantThe Ratnakar Bank Ltd., Regd. Office Kolhapur
RespondentM/S. Neliton Systems Ltd., Mumbai
Advocates:Mrs. Medha Behere-Advocate for the Complainant Mr. A.V. Patwardhan-Advocate for O.P.
Excerpt:
per mr. s.r. khanzode, honble presiding judicial member 1. this consumer complaint relates to supply of hardware and software as well as their installation at sangli branch of the complainant under their computerization scheme. for this purpose, complainant entered into an agreement with the national radio and electronics co. ltd. (known as “nelco”). the work was to be executed in three phases. softwares to be supplied (i.e. automation solution) was known as ‘cibex. this software was already installed and tested at other branch of the complainant at thane. total cost of the project was rs.15,25,000/-. agreement was accordingly executed in the beginning of the year 1994 as reflected from the correspondence placed on record. first of such correspondence is dated may 27, 1994, which is a letter from nelco to the branch manager of sangli branch of the complainant. 2. initially there was a complaint about working of the hardware supplied, namely, ups and on the count that all the nodes were not working at a time. this has been reflected from the notice dated 20/2/1995 sent by the complainant to nelco through its advocate mr.dilip j. mangsule. it is further reflected from the correspondence placed on record that when the automisation of the branch was undertaken and before it was completed, the workload of transaction of the said particular branch increased and it required certain upgradation of the system to which the complainant bank agreed as per its letter dated 5/9/1995 at the cost of rs.1,15,000/-. however, the project did not work through properly. complainant had a grievance which ultimately led to file this consumer complaint by the end of december 1998 or early of the year 1999. 3. in the complaint, inter-alia, it is alleged that there is basic defect in the entire work of the installation of computers and therefore, with any amount of corrective methods that has been adopted by the o.p. it cannot be set right, since the system is microscopic. complainant was not aware of the niceties and intrinsic working of the computer system and therefore, complainant bonafidely and in good faith believed in the suggestion made by o.p. that the said system badly installed could not be saved but for upgradation of the same and for that made additional demand of rs.1,15,000/-. complainant bonafidely believed the suggestion and accordingly, an amount of rs.1,15,000/- was paid to the o.p. but even thereafter the system has not shown any improvement and remains as defective as it was originally. 4. it is further alleged that on account of defective machines installed by the o.p., complainant had suffered in business and also had to incur other expenses and charges. complainant estimated the loss suffered by it at rs.20 lakhs. complainant prayed to reimburse the said loss along with interest payable on it @ 18% p.a. 5. o.p. neliton systems ltd. resisted the claim as per their written statement dated 15/3/2001. it is categorically submitted on its behalf that the computer system installed at the sangli branch of the complainant was by nelco, as per the agreement dated 31/07/1993 between the complainant and nelco. final bills were raised by nelco by the end of 31/3/1994 and, therefore, the complaint filed is barred by limitation. 6. at the second instance it is also alleged that nelco and the o.p. nelito systems ltd. are separate juristic persons and since there was no contract with the o.p., consumer complaint against it is not tenable. it is also submitted specifically that nelco ltd. is not converted into nelito systems ltd. o.p.-nelito systems ltd. is a joint venture of nelco and itochu corporation, japan and is a separate legal entity. they have also denied all the allegations about alleged failure of the computer system or defects in it, which were supplied by nelco. 7. we heard mrs. medha behere, learned counsel appearing for the complainant and mr.a.v.patwardhan, learned counsel for the o.p. perused the record. 8. after perusing the complaint and the plethora of the correspondence, the copies of which though placed on record, but not tendered in evidence under section 13 of consumer protection act, 1986 (herein after referred as “act” for brevity) and from the averments made in the pleadings, it could be seen that the agreement of automisation of the sangli branch of the complainant was entered around 31/7/1993 and the work was to be completed in three phases. final bill of the same was raised on or about 31/3/1994. even the lawyers notice making the grievance, which was addressed to nelco, is dated 20/2/1995, supra. therefore cause of action, if any, certainly arose somewhere in the year 1995 itself or by 20/2/1995. it is not a continuing cause of action since the work was executed. therefore, consumer complaint filed by the end of the year 1998 (or early of the year 1999) is certainly time barred in view of the provisions of section 24a of the act. 9. this consumer complaint also suffers from another fatal defect. the complaint is made against nelito systems ltd. which in their written reply categorically explained the situation and stated that nelco to which the complainant had entered into a contract of automisation or computerization to the sangli branch, is a different and separate legal entity. complainant had no contract at all with it and they have not supplied any computerization solution and software or hardware to the complainant. this fact is further supported by the o.p. by filing the affidavit of jatinder mohan varma, its c.e.o. there is no repudiation of this fact by the complainant. complainant has filed one rejoinder cum affidavit of one mr.a.r.chougule and also an affidavit in evidence of the same person, who is a branch manager of the complainant. but none of these affidavits repudiate the fact regarding the statement of fact as to the contract with nelco and that o.p. nelito systems ltd. and the nelco are separate legal entities. under the circumstances, consumer complaint as filed against o.p.-nelito systems ltd. would not survive. 10. besides this, complaint is about failure of the hardware and software and computer system provided and installed at sangli branch of the complainant. it may be pointed out that similar software is used at thane branch of the complainant and it works smoothly and properly as revealed from the record. under the circumstances, there may not be any failure of the software. complainant failed to establish that either there is any defect in the software or hardware supplied and which were installed at their place. there is also a novation of the original contract since as per additional requirements new hard disk and upgradation of the system was required. complainant failed to establish that there is a defect in the entire system as alleged. therefore, complainant miserably failed to establish that there is deficiency in service on the part of the o.p. hence, the complainant further failed to establish its claim for compensation of rs.20 lakhs. we hold accordingly. 11. for the reasons stated above, complaint deserved to be dismissed on one and more counts. hence, the order:- order: 1. complaint stands dismissed. 2. however, in the given circumstances no order as to costs. 3. copies of the order be furnished to the parties.
Judgment:

Per Mr. S.R. Khanzode, Honble Presiding Judicial Member

1. This consumer complaint relates to supply of hardware and software as well as their installation at Sangli branch of the complainant under their computerization scheme. For this purpose, complainant entered into an agreement with the National Radio and Electronics Co. Ltd. (Known as “NELCO”). The work was to be executed in three phases. Softwares to be supplied (i.e. automation solution) was known as ‘CIBEX. This software was already installed and tested at other branch of the complainant at Thane. Total cost of the project was Rs.15,25,000/-. Agreement was accordingly executed in the beginning of the year 1994 as reflected from the correspondence placed on record. First of such correspondence is dated May 27, 1994, which is a letter from NELCO to the Branch Manager of Sangli branch of the complainant.

2. Initially there was a complaint about working of the hardware supplied, namely, UPS and on the count that all the Nodes were not working at a time. This has been reflected from the notice dated 20/2/1995 sent by the complainant to NELCO through its Advocate Mr.Dilip J. Mangsule. It is further reflected from the correspondence placed on record that when the automisation of the branch was undertaken and before it was completed, the workload of transaction of the said particular branch increased and it required certain upgradation of the system to which the complainant bank agreed as per its letter dated 5/9/1995 at the cost of Rs.1,15,000/-. However, the project did not work through properly. Complainant had a grievance which ultimately led to file this consumer complaint by the end of December 1998 or early of the year 1999.

3. In the Complaint, inter-alia, it is alleged that there is basic defect in the entire work of the installation of computers and therefore, with any amount of corrective methods that has been adopted by the O.P. it cannot be set right, since the system is microscopic. Complainant was not aware of the niceties and intrinsic working of the computer system and therefore, complainant bonafidely and in good faith believed in the suggestion made by O.P. that the said system badly installed could not be saved but for upgradation of the same and for that made additional demand of Rs.1,15,000/-. Complainant bonafidely believed the suggestion and accordingly, an amount of Rs.1,15,000/- was paid to the O.P. But even thereafter the system has not shown any improvement and remains as defective as it was originally.

4. It is further alleged that on account of defective machines installed by the O.P., complainant had suffered in business and also had to incur other expenses and charges. Complainant estimated the loss suffered by it at Rs.20 lakhs. Complainant prayed to reimburse the said loss along with interest payable on it @ 18% p.a.

5. O.P. Neliton Systems Ltd. resisted the claim as per their written statement dated 15/3/2001. It is categorically submitted on its behalf that the computer system installed at the Sangli branch of the complainant was by NELCO, as per the agreement dated 31/07/1993 between the complainant and NELCO. Final bills were raised by NELCO by the end of 31/3/1994 and, therefore, the complaint filed is barred by limitation.

6. At the second instance it is also alleged that NELCO and the O.P. Nelito Systems Ltd. are separate juristic persons and since there was no contract with the O.P., consumer complaint against it is not tenable. It is also submitted specifically that NELCO Ltd. is not converted into Nelito Systems Ltd. O.P.-Nelito Systems Ltd. is a joint venture of NELCO and Itochu Corporation, Japan and is a separate legal entity. They have also denied all the allegations about alleged failure of the computer system or defects in it, which were supplied by NELCO.

7. We heard Mrs. Medha Behere, Learned Counsel appearing for the complainant and Mr.A.V.Patwardhan, Learned Counsel for the O.P. Perused the record.

8. After perusing the complaint and the plethora of the correspondence, the copies of which though placed on record, but not tendered in evidence under section 13 of Consumer Protection Act, 1986 (Herein after referred as “Act” for brevity) and from the averments made in the pleadings, it could be seen that the agreement of automisation of the Sangli branch of the complainant was entered around 31/7/1993 and the work was to be completed in three phases. Final bill of the same was raised on or about 31/3/1994. Even the lawyers notice making the grievance, which was addressed to NELCO, is dated 20/2/1995, supra. Therefore cause of action, if any, certainly arose somewhere in the year 1995 itself or by 20/2/1995. It is not a continuing cause of action since the work was executed. Therefore, consumer complaint filed by the end of the year 1998 (or early of the year 1999) is certainly time barred in view of the provisions of section 24A of the Act.

9. This consumer complaint also suffers from another fatal defect. The complaint is made against Nelito Systems Ltd. which in their written reply categorically explained the situation and stated that NELCO to which the complainant had entered into a contract of automisation or computerization to the Sangli branch, is a different and separate legal entity. Complainant had no contract at all with it and they have not supplied any computerization solution and software or hardware to the complainant. This fact is further supported by the O.P. by filing the affidavit of Jatinder Mohan Varma, its C.E.O. There is no repudiation of this fact by the complainant. Complainant has filed one rejoinder cum affidavit of one Mr.A.R.Chougule and also an affidavit in evidence of the same person, who is a Branch Manager of the complainant. But none of these affidavits repudiate the fact regarding the statement of fact as to the contract with NELCO and that O.P. Nelito Systems Ltd. and the NELCO are separate legal entities. Under the circumstances, consumer complaint as filed against O.P.-Nelito Systems Ltd. would not survive.

10. Besides this, complaint is about failure of the hardware and software and computer system provided and installed at Sangli branch of the complainant. It may be pointed out that similar software is used at Thane branch of the complainant and it works smoothly and properly as revealed from the record. Under the circumstances, there may not be any failure of the software. Complainant failed to establish that either there is any defect in the software or hardware supplied and which were installed at their place. There is also a novation of the original contract since as per additional requirements new hard disk and upgradation of the system was required. Complainant failed to establish that there is a defect in the entire system as alleged. Therefore, complainant miserably failed to establish that there is deficiency in service on the part of the O.P. Hence, the complainant further failed to establish its claim for compensation of Rs.20 lakhs. We hold accordingly.

11. For the reasons stated above, complaint deserved to be dismissed on one and more counts. Hence, the order:-

Order:

1. Complaint stands dismissed.

2. However, in the given circumstances no order as to costs.

3. Copies of the order be furnished to the parties.