BEFORE A.P STATE CONSUMER DISPUTES REDRESSAL COMMISSION AT HYDERABAD

F.A.No.399 OF 2011 AGAINST C.C.NO.100  OF 2010 DISTRICT FORUM VIZIANAGARAM

Between:

Vizia Co-operative Society
A Co-operative Society with Regd.No-169
Vizianagaram being rep. by its Liquidator
with its office at Sharof Khana Street,
Vizianagaram

                                                Appellant/opposite party

                A N D

1.   Chaganti Viswanadha Rao S/o late Eswar Rao

Aged 68 yrs, Red. Manager, Cooperative Central Bank
R/o Dr.No.25-2-24, Subramanyapet,
Vizianagaram.

2.   Changanti Kameswari W/o Viswanadha Rao
aged about 59 yrs, R/o Dr.No.25-2-24
Subramnyapeta, Vizianagar.

Respondents/Complainants

Counsel for the Appellants             M/s TV Sridevi

Counsel for the Respondent           Party in person

        QUORUM:   SRI R.LAKSHMINARASIMHA RAO, HON’BLE MEMBER

                                                AND

SRI THOTA ASHOK KUMAR, HON’BLE MEMBER

WEDNESDAY  THE TWENTY EIGTH DAY OF NOVEMBER

                                TWO THOUSAND TWELVE

Oral Order (As per Sri R.Lakshminarasimha Rao, Hon’ble Member)

                                        ***

1.             The opposite party society is the appellant.  The respondents filed complaint with the averments that they deposited amount with the appellant society under deposit receipt bearing Nos.1967/10206 for an amount of `52,338/-, 1968/10207 for a sum of `30,000/-, 1969/10208 for a sum of `67,193/-, 1765/10304 for an amount of `25,000/- and 1766/10305 for a sum of `25,000/- and they used to receive monthly interest on the deposit amount.  The respondents got renewed the deposits  and thereafter the appellant society paid interest on the amount till the month of June 2009.  The respondents requested the appellant society to pay the principal amounts which the appellant failed to pay as per the terms of agreement.

2.             The appellant society had resisted the claim on the premise that due to financial crises it was wound up long ago and a liquidator was appointed to manage its affairs and the same is made known to its customers through newspapers and the customers were requested to submit their claims.  The claims submitted by various customers of the appellant society have been under process.  The respondents submitted claim before the liquidator and after processing the claim the liquidator will pay the amount to them.  The complaint is not maintainable in view of Sec.121 of the A.P. Cooperative Society Act, without obtaining prior permission from the Registrar.

3.             The first respondent, in support of their claim filed his affidavit  and on behalf of appellant society, the Liquidator filed his affidavit. 

4.             The District Forum has allowed the complaint on the premise that the appellant society failed to pay back the deposited amount on maturity which constitutes deficiency in service on the part of the appellant society and that the objection as to the maintainability of complaint without leave of the registrar is not sustainable.

5.             Feeling aggrieved by the order of the District Forum, the opposite party society has filed appeal contending that it was wound up and a liquidator was appointed and in pursuance of the notice published in daily newspapers, the customer submitted their claims which including those of the respondents are in the process of settlement and that without leave of the Registrar, the complaint is not maintainable in view of Sec.121 of A.P. Cooperative Society Act, 1964 and that there was no deficiency in service on the part of the appellant society as also that the liquidator  would process the claim as per law.

6.             The point for consideration is whether the respondent  are entitled to the amount deposited by them?

7.             The respondents  made the deposits with the appellant society and also received the interest till the month June 2009.  Thereafter they did not receive any interest and inspite of repeated requests and several personal visits, the appellant did not choose to pay the deposit amount and the interest thereon. The respondents filed copies of deposit receipts  evidencing the deposits made by them with the promised interest @9.5% p.a. It is the appellant’s case that a liquidator was appointed on 11.11.2009 vide proceedings No.1986/2009-C.

8.            The National Commission in F.A.No.211/2010 and 241/2010 directed the opposite party-society therein to pay an amount of `28,34,778/- to the complainants with liberty for the complainants to move the Special Court for the purpose of recovery of the amounts or seek recovery of the amounts from the liquidator as per the prescribed procedure.

9.             It is the contention of the appellant that as a liquidator has been appointed, the liabilities and assets of the society has to be ascertained and then dues can be paid on a prorata basis subject to availability of funds.  It is an admitted fact that the respondents deposited amounts with the appellant society.   The deposit receipts were issued in favour of the respondents and they were got renewed.  The appellant paid  interest till June 2009. 

10.            The remedy under the Consumer Protection Act, 1986 is available as such a remedy is not in derogation to the provisions of A. P. Co-op. Societies Act, 1964. The National Commission in F.A.No.211/2010 and in F.A.241/2010 has observed that the complainant is at liberty to move the Special court for recovery of amount or may seek recovery from the liquidator as per due procedure in. In the instant case the liquidator has already been appointed. The decision of the National Commission in R.P.No.1768/2000, 1769/2000 and 2886/2005 dated 3-4-2007 reads as follows:

“In view of the matter, particularly when liquidation petition for winding up is pending before the High Court of Bombay and the fact that a Special Committee is appointed and functioning under the High Court and that it has drawn a plan for repayment to the depositors/investors as             quoted, we hereby direct that neither the State Commissions nor the Dist. Forums, would proceed further with the dispute which are pending against Lloyds Finance Ltd., However, it would be open to the Dist. Forums or the State Commissions to finalize the amount payable by the company (payment  of interest and compensation would be subject to final orders of the special committee or the liquidator) and/or to direct the investors to lodge a claim before the Special Committee. These directions shall be abided by Consumer Fora all over the country”.

11.            Keeping in view the aforementioned decision which allows the Commission to quantify the amounts, we hold the respondents entitled to `2,01,531/- The respondents  are at liberty to approach the liquidator for payment of these amounts with agreed rate of interest.  Payment of interest is subject to the final order of the Liquidators.

12.            In the result the appeal is allowed modifying the order of the District Forum.  The respondents  are directed to approach the liquidator for payment of `2,01,531/-  together with interest. 

                                                                                MEMBER

                                                                                MEMBER

                                                                            Dt.28.11.2012

KMK*