JUDGMENT - B.S. YADAV, Member :---This is an appeal against the order dated 30th December, 1992 passed by the State Consumer Disputes Redressal Commission, Delhi in the complaint filed by the present respondent No. 1 H.C.L. Ltd. (for short the `Company) against the present appellant, Bank of India (for short the Bank) which had been arrayed as opposite party No. 1 in the complaint and M/s. Dealwell Estates Pvt. Ltd. (for short the Firm) who was opposite party No. 2. By the impugned order the State Commission awarded Rs. 38,150/- to the complainant against the Bank as interest. Future interest from 5-9-1991 at the rate of 16% per annum till the date of payment and costs amounting to Rs. 2,000/- were also awarded. It may be mentioned here that the amount payable under the Bank guarantee issued by the Bank on behalf of the Firm had been paid to the complainant during the pendency of the complaint. 2. The brief facts are that the Company, who is engaged in the business of manufacturing, leasing and selling computers had entered into an agreement with the firm (now respondent No. 2) whereunder the complainant supplied a computer system to the said respondent. A schedule of payment was fixed in the said agreement according to which respondent No. 2 was to make a down payment of Rs. 9,450, a quarterly rental of Rs. 5,340/- and a security deposit of Rs. 68,500. The rent duration was for a period of 60 months commencing from 1st August, 1986. In consideration of the supply of equipment to the Firm by the Company, the Firm got issued an irrevocable Bank guarantee dated the 8th December, 1986 through the Bank in favour of the complainant. The Bank guarantee was valid upto 4th December, 1991. Under the Bank guarantee the liability of the Bank was restricted to Rs. 59,000/-. The Company invoked the Bank guarantee for the first time on 16th November, 1987 and asked the Bank to make the payment. At that time the Bank did not make any payment. In August, 1991, the Company filed the complaint before the State commission claiming Rs. 1,01,940/- with future interest till the date of payment plus Rs. 10,000 on account of mental pain and agony. During the pendency of the complaint the Bank paid the amount of Rs. 59,000/- to the Company on 5th September, 1991. In August, 1991, the Company filed the complaint before the State commission claiming Rs. 1,01,940/- with future interest till the date of payment plus Rs. 10,000 on account of mental pain and agony. During the pendency of the complaint the Bank paid the amount of Rs. 59,000/- to the Company on 5th September, 1991. According to the State Commission the Complainant Company was deprived of the use of the money for 4 years and 15 days i.e. from 18th August, 1987 to 15th September, 1991 and as the Bank had utilised this amount during this period, the Bank was liable to pay interest at the rate of 16% per annum to the complainant on the paid amount for the aforementioned period. The State Commission did not award any damages to the complainant as interest by way of damages had been granted. 3. Feeling aggrieved by the said order the Bank has come before us by way of this appeal. 4. The first point that was raised on behalf of the Bank was that there was no privity of contract between the Bank and the Company and, therefore, the latter cannot make any complaint against the Bank under the Consumer Protection Act, 1986 (for short the Act). This argument does not have any force. The Bank guarantee was got issued by the Firm from the Bank favouring the company. Company is therefore clearly the beneficiary of the contract of service that is entered into between the Firm and the company and, therefore, the company falls under the definition of "consumer" as given in section 2(1)(d) of the Act. We need not dilate on this point much as during arguments on the adjourned date the appellants counsel conceded that the company was the "beneficiary" within the meaning of the Act and, therefore, the complaint was maintainable. 5. The main thrust of the argument advanced on behalf of the Bank is on the question of limitation. It is submitted that the complaint had been filed beyond the period of limiation as the company had first invoked the guarantee on 16th November, 1987, while the complaint was filed on 13th August, 1991 i.e. after more than 3 years of the date of invocation of the guarantee. It is submitted that the complaint had been filed beyond the period of limiation as the company had first invoked the guarantee on 16th November, 1987, while the complaint was filed on 13th August, 1991 i.e. after more than 3 years of the date of invocation of the guarantee. It was also submitted that any payment made subsequent to the expiry of period of said period of 3 years would not extend the period of limitation when the original claim itself stood extinguished. It will be useful to reproduce here paragraph No. 6 of Bank Guarantee which reads as follows : "Notwithstanding anything mentioned herein before, our liability under this guarantee is restricted to Rs. 59,000/- (rupee Fifty Nine Thousand Only). The guarantee will remain valid upto 4th December, 1989 and thereafter to each extended year upto a maximum of 4th December, 1991. Unless a suit or an action to enforce any claim under the guarantee is filed against us on or before 4th December, 1991, all your rights under the said guarantee shall be forfeited and we shall be released and discharged from all liabilities thereunder." We are of the opinion that as the Bank guarantee was valid upto the mid-night of 4th December, 1991 the cause of action subsisted on a continuing basis till such time the Bank guarantee expired, it may be mentioned here that the Bank never repudiated the claim made by the company. Some correspondence which passed between the parties has been produced in the case. The last letter which was written by the company to the Bank is dated 10th April, 1991 asking the Bank to remit the amount. The Bank did not send any reply to the company nor did it remit the amount. On the other hand, the Bank had been writing letters to the Firm to remit the amount so that claim under the guarantee could be paid. The Firm remitted the amount vide leter dated 5th September, 1991. On the same day the Bank remitted the amount to the complainant. Hence unless the companys claim under the Bank guarantee was repudiated the cause of action which had accrued to the company remained alive. Terminus a quo so far limitation question is concerned will be only the date of denial by the Bank. The Bank never denied its liability under the Bank guarantee. Hence unless the companys claim under the Bank guarantee was repudiated the cause of action which had accrued to the company remained alive. Terminus a quo so far limitation question is concerned will be only the date of denial by the Bank. The Bank never denied its liability under the Bank guarantee. In fact it was admitting its liability in the letters written to the firm. 6. The question of limitation can also be viewed from another angle. The Bank guarantee was initially valid upto 4th December, 1989 and thereafter it was extended upto 4th December, 1991, while the invocation of the guarantee by the company was still pending. Thus the cause of action further arose on 4th December, 1989 when the Bank guarantee was renewed. Hence in view of above, it has to be held that the complaint filed by the company was within limitation. 7. Lastly it was argued on behalf of the appellant that the appellant Bank is liable to pay only that amount which was specified under the Bank guarantee. According to the appellant that liability is limited to Rs. 59,000/- and therefore, he cannot be asked to pay any amount over and above that amount. The complainant in his complaint prayed for Rs. 1,07,940/- i.e., the amount of Rs. 59,000/- payable under the Bank guarantee plus interest at the rate of 18%. The interest was claimed on the ground that the Bank had been deficient in rendering service to the Company. The State Commission has found that it was the duty of the Bank to make payment of the amount under the Bank guarantee when it was first invoked but it was done on 6th, September, 1991. The State Commission allowed interest at the rate of 16% on Rs. 59,000/- from 18-8-1987 to 6-11-1991. 8. The complaint was filed under the Act on the ground that the "service" which the Bank had undertaken to render was deficient. Therefore, the claim for the amount in excess of Rs. 59,000 is under the Act. The State Commission allowed interest at the rate of 16% on Rs. 59,000/- from 18-8-1987 to 6-11-1991. 8. The complaint was filed under the Act on the ground that the "service" which the Bank had undertaken to render was deficient. Therefore, the claim for the amount in excess of Rs. 59,000 is under the Act. Deficiency has been defined in section 2(1)(g) of the Act which reads as follows: "Deficiency" means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service". As the Bank has been deficient in the rendering of `service which it had undertaken to perform, the State Commission justified in awarding interest as compensation under section 14(1)(d) of the Act. 9. Here we make it clear that the State Commission has calculated interest on Rs. 59,000 from 18th August, 1987. The State Commission has committed a mistake in calculating the interest from that date. For the first time the complainant had sent notice dated 18th November, 1987 to the Bank invoking the guarantee. It is, therefore, entitled to claim only from 18th November, 1987 till 6th September, 1991 when the amount was actually paid. 10. For the above said reasons we partly modify the order of the State Commission. Instead of Rs. 38,153/- which the State Commission has calculated as interest from 18-8-1987 the Bank is liable to pay interest at the rate fixed by the State Commission only from 18th November, 1987 to 6th September, 1991. Except for the above modification, the order of the State Commission is confirmed. The Bank is also ordered to pay Rs. 1,000/- as costs of the present proceedings to respondent No. 1 M/s. H.C.L. Ltd. Appeal disposed off.