This Complaint coming up before us for hearing on 03-04-12 in the presence of Sri P. Raja Rao, advocate for complainant and of              Sri M.S.N. Murthy, advocate for 1^st opposite party and of                         Sri S.A. Khadar, advocate for 2^nd opposite party and 3^rd opposite party remained absent and set exparte, upon perusing the material on record and after hearing both sides and having stood over till this day for consideration this Forum made the following:-

O R D E R

Per Sri A. Hazarath Rao, President:-

        The complainant filed this complaint U/S 12 of Consumer Protection Act, 1986 seeking a direction to the opposite parties to return the document bearing No.17/1961 dated 02-01-1961;                 share capital of Rs.7,000/- together with interest and compensation of Rs.50,000/-  besides costs.

2.     In brief the averments of the complaint are these:

        The 3^rd opposite party is the inspecting and auditing authority of the 1^st opposite party.   The 1^st opposite party is the branch of the 2^nd opposite party.   Being a member of the opposite parties 1 and 2, the complainant obtained Rs.1,40,000/- as a loan and undertook to repay the said amount with interest @12.5% p.a., in five yearly installments @Rs.28,000/-.   The complainant deposited his title deeds i.e., sale deed dated 02-01-1961 with the opposite parties 1 and 2.   In all the complainant paid Rs.2,75,348/- towards loan.   All the payments were entered in the pass book of the complainant.  Inspite of discharging the entire loan amount the opposite parties failed to return the original title deed deposited with them on some pretext or other.   The complainant is also entitled for return of share capital of Rs.7,000/- also.   Inspite of notice the opposite parties 1 and 2 did not give reply.  The conduct of the opposite parties 1 and 2 amounted to deficiency of service.

3.     The 3^rd opposite party remained exparte. 

4.     The contention of the 1^st opposite party in brief is hereunder:   

        The complaint is not maintainable as this Forum has no jurisdiction.   As per agreement the 1^st opposite party shall receive payments from the borrowers and keep 1% interest margin for its maintenance and forward the remaining amount to the 2^nd opposite party.  The Ex-Business Manager, Ex-President, Ex-Managing Committee of the 1^st opposite party misappropriated about Rs.20,00,000/- of society funds and caused loss.  The 3^rd opposite party ordered for statutory inspection u/s 52 of A.P. Co-operative Societies Act, 1964 and the inspecting authority submitted his report stating that Ex-Management and Ex-Business Manager of the 1^st opposite party misappropriated huge funds.   The case is pending hearing u/s 60 of A.P. Co-operative Societies Act.   Meanwhile the   Ex-President and another of the 1^st opposite party filed WP.No.10614/07 and got an interim injunction order not to proceed with the inspection report.   Hence, surcharge proceedings are pending with the 3^rd opposite party.  Under those circumstances, the 1^st opposite party is in helpless condition in returning the documents to the complainant.   The complainant is not entitled for return of share capital amount of Rs.7,000/- as the dispute in returning the title deeds is not settled.   The complainant failed to avail the alternative remedy available u/s 61 of A.P. Co-operative Societies Act for his grievance and straight away approached the Consumer Forum.   The 1^st opposite party plays a nominal role, just made resolutions on the application of its members; forward them to the 2^nd opposite party for sanction of loan by collecting meager amount of 1% as margin for maintenance.   It is the duty of the 2^nd opposite party to release documents to the complainant if paid the entire loan amount.   The complaint therefore may be dismissed.

5.      The contention of the 2^nd opposite party in brief is hereunder:   

          The 2^nd opposite party is a state level co-operative society registered under A.P. Co-operative Societies Act, 1964. The                    2^nd opposite party obtained loans from LIC of India on interest on creation of a floating charge on all the assets, lends loan for construction of house to members of Co-operative Housing Societies on a meager margin of 1% to meet its establishment charges.   The 1st opposite party is not a branch of the 2^nd opposite party.   The             1^st opposite party transmitted Rs.2,34,500/- to the 2^nd opposite party in respect of the loan of the complainant leaving a balance of Rs.58,753/- towards principle, Rs.4485/- as interest, Rs.306/- as penal interest by 31-08-11.  The share capital held by the complainant will be adjusted to the loan account at the time of closure of the due amount. The 2^nd opposite party gave a detailed reply. The complainant can take up the matter with the 1^st opposite party for release of original documents.   The complaint therefore be dismissed.

6.  Exs.A-1 to A-25 and Exs.B-1 to B-5 on behalf of complainant and 2^nd opposite party were marked respectively.

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7.   Now the points that arose for consideration in this complaint are:

        1. Whether the complainant is a consumer?

2. Whether this Forum has got jurisdiction to entertain the                                 complaint?

3. Whether the opposite parties committed deficiency of                           service?

4. Whether the complainant is entitled for return of Rs.7,000/-                   being share capital amount?

        5. Whether the complainant is entitled to compensation?

        6. To what relief?

8.   POINTS 1&2:-   The complainant taking loan of Rs.1,40,000/- under an equitable mortgage by depositing title deeds from the                   1^st opposite party is not in dispute.     In Secretary vs. Thiru Murugan Co-operative Agricultural Credit Society vs. M. Lalitha (dead) through LRs and others  2004 (1) CPJ (1) SC

        “In Dhulabhai case consideration was whether the jurisdiction of the Civil Court was excluded.   Propositions (1) and (2) indicate that where the statute gives a finality to the orders of the special tribunals the jurisdiction of Civil Courts must be held to be excluded if there is adequate remedy to do what the Civil Courts would normally do in a suit. Further, where there is an express bar of the jurisdiction of the Court, an examination of the scheme of the particular Act to find the adequacy or the sufficiency of the remedies provided may be relevant but is not decisive to sustain the jurisdiction of the Civil Court.   The remedies that are available to an aggrieved party under the 1986 Act are wider. For instance in addition to granting a specific relief the Forums under the 1986 Act have jurisdiction to award compensation for the mental agony, suffering, etc., which possibly could not be given under the Act in relation to dispute under Section 90 of the Act.   Merely because the rights and liabilities are created between the members and the management of the society under the Act and Forums are provided, it cannot take away or exclude the jurisdiction conferred on the Forums under the 1986 Act expressly and intentionally to serve a definite cause in terms of the objects and reasons of the Act reference to which is already made above when the decision of Dhulabhai’s case was rendered the provisions similar to 1986 Act providing additional remedies to parties were neither available nor considered.   If the argument of the learned counsel for the appellant is accepted it leads to taking away the additional remedies and Forums expressly provided under the 1986 Act, which is not acceptable”.

        Taking a clue from the above decision rendered by the Supreme Court we hold that this Forum has jurisdiction to entertain the complaint. 

9. POINT No.3:-    The 1^st opposite party   has not disputed the payments made by the complainant towards discharge of the loan obtained by her.      The complainant has to pay installment amount to the 1^st opposite party only.  The payments shown in Ex.A-1 pass book are corroborated by Exs.A-2 to A-21 receipts. It is not the case of the 1^st opposite party that the complainant is still due. Under those circumstances, the contention of the complainant that he paid entire amount stands to reason and can be accepted in all probabilities.

10.  The contention of the opposite parties 1 and 2 is that Ex-Business Manager, Ex-President and Ex-Managing Committee misappropriated about 20 lakhs of Society Funds (OP1) and caused loss. In   WP.No.14552 of 2005 between M. Seshagiri Rao and the Prl. Secretary to Government, Housing, Municipal Administration and Urban Development Department, Secretariat, Hyderabad and others   was finally disposed on 23-09-10 holding

            “From the counter affidavit of the 5^th respondent and as well as the material on record, it is clear that the petitioners have cleared the loan amounts at the society level.   When the petitioners have duly paid the installment amounts which the society, it is for the society to remit those amounts with the 2^nd respondent.   Merely because, the society did not remit the same with the 2^nd respondent, and there is diversification of funds by the society, the petitioners cannot be blamed for non payment of loan amounts.   In the circumstances, I am of the opinion that the petitioners are entitled for release of the documents.   The respondents are, therefore, directed to release the documents to the petitioners, forthwith, if not, already released in pursuance of the interim order of this Court, dated 23-08-06. The respondents are further directed not to insist the petitioners for payment of any further amounts”.   

11.  The complainant is in no way concerned with the internal disputes of the opposite parties 1 and 2 as rightly contended by him.   The complainant is entitled to get his documents returned when once the loan is discharged.   It is not the case of the 1^st opposite party that the complainant is still due in respect of the subject loan.  Clause 16 of Ex.B-5 assignment deed dated 26-05-03 in between the opposite parties 1 and 2 says that if there is any default in payment of any installment or if there is any breach of any of the terms of this deed by the society, the federation shall be entitled to recover the whole amount due under the assignment by sale of the property now assigned as well as from other assets of the society including the share capital and reserve fund of the society.  

12.   Taking a clue from the above decisions, we are of the view that the opposite parties 1 and 2 are liable to return the documents to the complainant and not returning of documents amounted to deficiency of service.  We therefore answer this point in favour of the complainant.

13.  POINT No.4:-    The complainant also sought return of Rs.7,000/- paid by him towards share capital.   Ex.A-1 did not reveal payment of Rs.7,000/- as share capital.   The complainant also did not file any receipt showing the same.   Exs.A-2 to A-21 did not relate to the payment of share capital.  But the 1^st opposite party in his affidavit mentioned that the complainant is not entitled for return of the share capital amount of Rs.7,000/- as the dispute for return of title deeds is pending.   It can therefore be said that the complainant deposited Rs.7,000/- as share capital.   In view of findings on point no.1 the complainant is entitled for return of Rs.7,000/- i.e., the share capital amount.   We therefore answer this point in favour of the complainant. 

14. POINT No.5:-   The complainant claimed Rs.50,000/- as compensation for mental agony.  The contention of the 1^st opposite party is that it is unable to return the documents to the complainant in view of surcharge proceedings pending against its Ex-Business Manager, Ex-President and Ex-Managing Committee and WP No.10614 of 2007.  The said contention of the 1^st opposite party is having considerable force.   Therefore we are not inclined to grant any compensation to the complainant under the above circumstances.  We therefore answer this point against the complainant. 

15. POINT No.6:-   In view of above findings, in the result,                  the complaint is partly allowed against opposite parties 1 and 2 with costs of Rs.1,000/- (Rupees one thousand only) directing them to release the documents kept by the complainant under equitable mortgage and to return Rs.7,000/- towards share capital to the complainant together with interest @9% p.a., from the date of complaint till realisation.   The claim against the 3^rd opposite party is dismissed without costs.   The opposite parties 1 and 2 are directed to comply the above order within a period of six weeks from the date of receipt of the copy of the order.

Typed to my dictation by Junior Stenographer, corrected by me and pronounced in the open Forum dated this the 9th day of April, 2012.

MEMBER                                             MEMBER                                       PRESIDENT

APPENDIX OF EVIDENCE

                                            DOCUMENTS MARKED

For Complainant :

For 2^nd Opposite Party:  

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Compared by :                                                                                             PRESIDENT