Axis Bank wins battle against marketing firm

New Delhi, July 9 (IANS) Axis Bank has got a major relief from the top consumer court against a marketing company in Maharashtra that invoked the provisions of the consumer protection law alleging deficiency in service in the operation of 10,060 ATM cards through which it was paying commission to its agents.

National Consumer Disputes Redressal Commission Presiding Member Vinay Kumar held that Nashik-based PDC Marketing Private Limited was not a consumer as defined under the law as the bank account and the ATM cards, though in the company's name, were used to pay commission to its agents towards "commercial services" rendered by them to the firm.

The national commission endorsed the Maharashtra consumer commission's decision that it was not a simple banking service, but that "a camouflaged commercial activity was being carried out through this system in which 10,060 ATM cards had been activated by the bank".

Dismissing the company's appeal against the state commission's decision, Vinay Kumar said: "The revision is, therefore, held to be devoid of any merit and is dismissed as such. The order of the Maharashtra State Consumer Disputes Redressal confirmed."

"The complainant cannot be treated as consumer under the act. The decision of the state commission is, therefore, clearly based on correct appreciation of the facts and the law," the national commission said.

The bank had issued ATM cards in the name of PDC Marketing Private Limited, which were distributed to the sales commission agents (SCAs). This arrangement enabled the SCAs to withdraw the amount of commission payable to them directly. The bank account and the ATM cards stood in the name of the company, the apex consumer commission said.

Vinay Kumar said: The revision petition of the company, while challenging the order of the state commission, sought to rely upon certain decisions of the Supreme Court as well as the national consumer commission. However, no attempt was made to show how any of these decisions would be applicable to the facts of the present case.

He upheld the finding of the state commission that "the total activity of the company is a commercial activity and, therefore, though what the bank did for the company may be a service, but it was hired for commercial activity of the complainant".

"Therefore, the company may have a remedy against the bank, but the company is not a consumer within definition of Section 2(1) (d) of Consumer Protection Act, 1986, and consumer complaint is not a remedy for the company," the national consumer commission said.

The company now has the option of challenging the national consumer commission's decision in the Supreme Court.

(Rahul Chhabra can be contacted at


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