Delhi

StateCommission

FA/12/1148

KRISHAN KR. DHANKHAR - Complainant(s)

Versus

ASHOK LEYLAND FIN. LTD. - Opp.Party(s)

31 May 2017

ORDER

IN THE STATE COMMISSION: DELHI

(Constituted under Section 9 of the Consumer Protection Act, 1986)

                                                             Date of Decision: 31.05.2017

First Appeal No. 1148/2012

(Arising out of the order dated 23.11.2012 passed in Complaint Case No. 776/2006 by the District Consumer Disputes Redressal Forum-X UdyogSadan, C-22 & 23 Institutional Area (Behind Qutub Hotel) New Delhi-110016)

In the matter of:

Krishan Kumar Dhankhar

S/o Sh. Ishwar Singh

R/o RZ-66A, M-Block

RoshanpuraExtn.

Najafgarh, New Delhi-110043                     .........Appellant

 

Versus

 

M/s Ashok Leyland Finance Ltd.

(Presently known as Indusind Bank Ltd.)
43, Community Centre,

New Friends Colony

New Delhi-110065

 

 

Corporate Office: 86

Chamiers Road, Chennai-600018

 

Regd. Office: 2401, General Thimmayya Road

Cantonment, Pune-411001                            ..........Respondent

                                                                                   

CORAM

N P KAUSHIK                         -                  Member (Judicial)

 

1.         Whether reporters of local newspaper be allowed to see the judgment?                   Yes

2.         To be referred to the reporter or not?                                                                  Yes

 

N P KAUSHIK – MEMBER (JUDICIAL)

 

JUDGMENT

1.         The appellant Sh. Krishna Kumar Dhankhar has challenged the orders dated 23.11.2012 passed by the Ld. District Forum X New Delhi. Vide impugned orders, the complaint filed by the appellant/complainant was dismissed. Parties hereinafter shall be referred to by their status in the original complaint as it was.
2.         Complainant filed a complaint on 26.09.2006 in the District Forum alleging that he had purchased an engine (horse) from M/s Ashok Leyland Ltd. which was to be used as carrier after connecting a trailer with it. Cabin of the engine was also required to be made later on. The transaction was done on 20.02.2004 after entering into an agreement with Ashok Leyland Finance Ltd. 43 Community Centre New Friends Colony Delhi 65 (hereinafter referred to as OP). Price of the engine was Rs. 8,50,000/-. OP for this purpose sanctioned a loan to the tune of Rs. 8,50,000/- itself to the complainant. After adding interest to the principle amount of Rs. 8,50,000/-, an amount of Rs. 9,64,750/- was to be repaid to the OP in equal monthly installments (EMI) which were 34 in number and each EMI was of Rs. 28,375/-. Contention of the complainant is that he was not given the copy of the agreement. The complainant handed over to the OP, 39 blank cheques.
3.         Complainant submitted that in the month of March 2004 OP informed him on telephone that each EMI was of Rs. 28,375/-. Complainant in the month of August 2004 made calculations at his end and found that 36 installments of Rs. 28,375/- amounted to a total amount of Rs. 10,21,500/-. Complainant pointed out the discrepancy to the OP and stated that inclusive of the interest,an amount of Rs. 9,64,750/- only was payable. Upon this, OP issued a repayment schedule and told that the total number of EMI was 34 and not 36.
4.         Controversy between the parties arose on the night of 13.06.2005 when the complainant was plying the vehicle in Jallandhar(Punjab)with certain goods. OP with the help of anti-social elements and bouncers made an attack on the complainant who was driving the vehicle. Complainant was beaten. The vehicle was taken into possession by the bouncers of the OP. Registration certificate, national permit and pollution control certificate of the vehicle were also taken by the bouncers. Complainant begged for mercy and asked the men of the OP to grant him two weeks’ times to make the payment of the outstanding dues, if any. Complainant contended that on the date of repossession an amount of Rs. 1,99,626/- stood to the OP. He also submitted that the said figure could go up as some receipts were missing at his end.
5.         Complainant further submitted that the OP sold the vehicle to a third person at a throw away price without giving him any notice.
6.         Complainant also submitted that OP used one of his blank cheques bearing no. 553613 by filling an amount of Rs. 3,62,000/-  with the date 18.01.2006 and filed a case against him under section 138 of Negotiable Instruments Act in the court of MM,Karkardooma Courts Delhi.
7.         On the basis of the aforesaid spectrum of facts, complainant prayed for recovery of Rs. 1,99,626/- alongwith costs of the driver’s cabin amounting to Rs. 82,000/-, Advocate’s fee (in the case under section 138 Negotiable Instrument Act) amounting to Rs. 35,000/- and other miscellaneous expenses of Rs. 15000/-. Besides this, compensation to the tune of Rs. 1,50,000/- for harassment, inconvenience and mental agony was also prayed for. Thus the complainant claimed in all an amount of Rs. 4,81,626/-.
8.         OP contested the claim in the District Forum admittingthat the vehicle in question was financed by him. OP also admitted having received the blank cheques from the complainant as alleged. OP stated that a schedule of payments was provided to the complainant and the complainant had handed over chequesalongwith security cheques to the OP. OP further contended that the complainant was a defaulter to the loan and the cheques issued by him were bounced. OP denied if the cabin of the engine was purchased by the complainant for an amount of Rs. 82,000/-. OP however submitted that it disposed of the vehicle to a third person for an amount of Rs. 6,50,000/- and the said amount was credited in the account of the complainant. OP raised a further demand of the balance amount which the complainant did not make. OP submitted that he was left with no option but to use the security cheques. Even when those cheques got bounced, a specific notice was sent to the complainant to clear the cheques’ amounts. When those cheques were bounced,OP was left with no option but to file the complaint under section 138 Negotiable Instrument Act which was still pending in a court of law.
9.         Ld. District Forum dismissed the present complaint observing that the complainant could not challenge the right of the OP to repossess the vehicle, as per agreement. Ld. District Forum held that in the absence of any evidence to show that the complainant made any effort to report the matter to the police and file a complaint in a court of law, it could not be accepted that the MLC (Medico-legal Certificate) relied upon by the complainant related to the incident of repossession of the vehicle. Relevant para of the impugned judgment is reproduced below:

“On merits, it is not a disputed fact that the complainant got financed the vehicle from the respondent and the loan was repayable in installments and there was some default in repayment. Copy of agreement executed between the parties is part of the file and as per Clause 15 thereof the borrower shall be bound to return the asset to the lender in case of default and shall not prevent or obstruct the lender from taking possession of the same. It is further laid down therein that the agents, servants, officials of the company will have unrestricted right of entry and shall be entitled to enter upon the premises where the vehicle is lying or kept to take possession thereof without notice of the borrower. Vide this clause the lender was also given the right to sell away the vehicle in case of event of default. It is settled law that the parties are bound by the agreement executed between them and that being so the complainant cannot challenge the right of the respondent to repossess the vehicle.However, the question to be decided is as to whether any force was used by the respondent while resorting to repossession. In this respect only a copy of ML report is available on the file purporting to have been issued by Civil Hospital, Jallandhar. Counsel for respondent pointed out that the detail of incident is nowhere mentioned in this document nor there is any material to show that the complainant made any report with the police. There is a simple mention in this document that it relates to an incident near Transport Nagar. In the absence of any evidence to show that the complainant made an effort to report the matter to the police or file a complaint before the court, it cannot be concluded that this document (ML report) is connected to any such incident of taking away of the vehicle by the respondent in the area of Jallandhar. So far as the allegation of the complainant that the respondent filled up an exorbitant amount of Rs. 3,62,000/- in the blank cheque delivered by him, admittedly, the cheque got bounced and the respondent instituted a complaint against the present complainant u/s 138 of N.I.Act. As such the question whether it was a blank cheque (later on filled up by the respondent) and whether the complainant is bound to pay the amount mentioned therein or not is to be decided by the Criminal Court where the said complaint has been instituted. In our considered view no case of deficiency in service is made out against the respondent and, accordingly, the complaint stands dismissed.”

 

10. Before proceeding further, let us examine the factual controversy between the parties. Complainant in his complaint in the District Forum alleged that he had paid an amount of Rs. 1,99,626/- to the OP towards refund of the loan amount by way of EMIs. OP stated in his written version (before the District Forum) that the complainant deposited one or two EMIs in cash with the company. OP has not mentioned any specific amount having been received from the complainant.
11. Ld. Counsels for the parties present have taken this Commission through the documents/statements relating to the payments made by the complainant towards EMIS. Details of these payments are as under:

S. No.	DATE	AMOUNT	Mode of Payment/Proof of Payment
1.	30.03.2004	Rs. 28,375/-	Shown in statement of account issued by the OP
2.	20.04.2004	Rs. 28,375/-	Shown in statement of account issued by the OP
3.	31.05.2004	Rs. 28,375/-	Shown in statement of account issued by the OP
4.	08.06.2004	Rs. 15,000/-	Shown in statement of account issued by the OP
5.	08.06.2004	Rs. 5000/-	Shown in statement of account issued by the OP
6.	20.06.2004	Rs. 28,375/-	Shown in statement of account issued by the OP
7.	25.06.2004	Rs. 20,000/-	Shown in statement of account issued by the OP
8.	16.08.2004	Rs. 28,375/-	Paid in cash after returning the cheque
9.	16.08.2004	Rs. 20,000/-	Receipt filed and not denied by the OP
10.	19.11.2004	Rs. 20,000/-	Receipt filed and not denied by the OP
11.	22.11.2004	Rs. 10,000/-	Receipt filed and not denied by the OP

 

The only disputed payment from the table above relates to the payment at serial number ‘8’ above. Complainant has placed on record a copy of the cheque bearing number 536180 for an amount of Rs. 28,375/- bearing endorsement ‘cancelled’, cash collected against the cheque.

•  
•  

 

The cheque in question is dated 20.08.2004 and issued in favour of the OP. It bears the cheque number which is one out of the cheques given to the OP at the time of sanction of loan. It may be mentioned here that the cheque numbers which were given blank to the OP, bore the numbers 536174 to 536200 and 556305 to 556316. Clearly the cheque number ‘536180’ is thecheque falling in the line of cheques given to the OP at the time of sanction of loan. OP has however admitted the cheques of the aforesaid series received by him in blank at the time of sanction of loan. The only cheque returned by the OP to the complainant bears the number 536180. OP also received the aforesaid amount of Rs. 28,375/- (cheque in question is exhibited as exhibit C1 while dictating these orders) in cash and accordingly returned him the relevant cheque.

12. Now a question arises whether the OP was within his rights to repossess the vehicle.Law on the subject has been laid down in the cases of CitycorpMaruti Finance Ltd. v. S.VijayaLaxmi,(RP No. 737/2005 decided by Hon’ble National Commission) and ICICI v. PrakashKaur, AIR 2007 Supreme Court 1349 decided by the Hon’ble Supreme Court. The Hon’ble National Commission in the case of Citicorp Maruti Finance Ltd. (supra) observed as under:

“When a vehicle is purchased by a person (consumer) by borrowing money from the money lender/financier/banker, the consumer is the owner of the vehicle and not the money lender/financier/banker, unless the ownership is transferred. In a democratic country having well established independent Judiciary and having various laws it is impermissible for the money lender/financier/banker to take possession of the vehicle for which loan is advanced, by use of force. Legal or judicial process may be slow but it is no excuse for employing musclemen to repossess the vehicle for which loan is given. Such type of instant justice cannot be permitted in a civilized society where there is effective rule of law. Otherwise, it would result in anarchy, that too, when the borrower retorts and uses the force.

          A hire-purchase agreement is a normal one under which owner hires goods to another party called the hirer and further agrees that the hirer shall have an option to purchase the chattel when he has paid a certain sum, or when the hire-rental payments have reached the hire-purchase price stipulated in the agreement.

          As against this, when a person desires to purchase vehicle/goods and not having sufficient money on hand, borrows the amount needed from a money lender/financier/banker and pays it over to the vender of the vehicle, the transaction between the consumer and the money lender will unquestionably be a loan transaction. In such a case the vehicle purchased by the consumer is registered in the name of the consumer and remains at all material times so registered in his name. The consumer remains qua the world at large the owner and remains in possession of the vehicle. By an agreement the vehicle can be given as security for the loan advanced. In such a case, the right to seize the vehicle is merely a licence to ensure compliance with the terms of the so called hire purchase agreement. It is to be stated that many financiers/banks are in race for giving loan for purchase of vehicles or various articles. After giving loan and taking interest in advance, the polite behaviour changes because of the documents which are signed on the dotted lines by the borrower. On occasions, borrower suffers harassment, torture, or abuses at the hands of the musclemen of the money lender. Such a behaviour is required to be prohibited and the process of repossession is required to be streamlined so as to fit in cultural civilized society. Let the rule of law prevail and not that of jungle where might is right. 

In such cases, even the Police does not register the FIR or help the aggrieved consumer. In the present case, nothing has been done by the Police for years despite the complaint. In any case, taking of pound of flesh is required to be discouraged.

In a case when the vehicle was repossessed by use of force, and thereafter, sold without informing the Complainant, in our view, it would be unjust to direct the consumer to pay the balance amount, as alleged by the financer to be outstanding. If such a relief is given to the money lender/financier, it would be unjust enrichment to the money lender and against equity. That question may arise for consideration only if the Complainant willingly surrenders the vehicle for sale and for recovery of the outstanding amount. Then, in such cases, consumer dispute would not arise.

where the vehicle is forcefully seized and sold by the money lender/financer/banker it would be just and proper to award ‘reasonable compensation’ to the Complainant. ‘Reasonable compensation’ would depend upon facts of each case.”                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

 

13.  Applying the abovesaid law to the case in hand, OP was not entitled to repossess the vehicle. He was also not entitled to sell the same to a third person without informing the complainant. Asking the complainant to pay the balance amount as alleged by the OP, it would be unjust enrichment to the OP and against the principles of equity.
14. Hon’ble Supreme Court in the case of Ghaziabad Development Authority v. Balbir Singh,(2004) 5 Supreme Court Cases 65, laid down the principle for awarding of the compensation. It was held that compensation for loss or injury has to be based on a finding of loss or injury. It has to co-relate to the amount of loss or injury. It was further held that the award of compensation must be under different separate heads and must vary from case to case depending on facts of each case. Compensation for harassment/injury both mental and physical may be given alongwith compensating the loss. Hon’ble Supreme Court further held that the Commission or the forum is entitled to award not only the value of goods but also to compensate the consumer for injustice suffered by him.
15. Coming to the case in hand the malafide act of the OP in repossessing the vehicle has deprived the complainant of his livelihood. The pain of the complainant started on 14.06.2005 and continuous till date. The complainant has prayed for the recovery of an amount of Rs. 4,81,626/-. Adding the amount of Rs. 28,375/- (exhibit C1 as discussed above), the amount comes to Rs. 5,10,001/-. I am, therefore, of the considered opinion that the complainant is entitled to the recovery of the said amount of Rs. 5,10,001/- alongwith interest @ 12% p.a. from the date of filing of the complaint i.e. w.e.f. 26.09.2006 uptil the date of its realization. The impugned orders dated 23.11.2012 passed by the Ld. District Forum are hence set aside. Appeal is allowed. OP is directed to pay to the complainant an amount of Rs. 5,10,001/- w.e.f. 26.10.2006 alongwith interest @ 12% p.a. from the date of filing of the complaint till the date of its realization.
16. OP filed an affidavit dated 15.05.2017 stating as under:

“2. That in the aforementioned case, the amount outstanding as on 13/06/2005 was Rs. 3,24,875/- (Rupees Three Lakhs Twenty Four Thousand Eight Hundred Seventy Five only). There were 15 EMIs due each of Rs. 28,375/- until 13/06/2005, i.e., total amount due as on 13/06/2005 was Rs. 4,25,625/-. The Appellant herein had paid only Rs. 1,00,750/- (Rupees One Lakh Seven Hundred Fifty only). Hence balance outstanding as on 13/06/2005 was Rs. 3,24,875/- excluding cheque bouncing and late payment charges.

3. That the amount payable as on 13/06/2005 towards full and final settlement was Rs. 9,50,000/- (Rupees Nine Lakhs Fifty Thousand only), excluding cheque bouncing and late payment charges.

4. That on the request of the Appellant, the Respondent settled the loan account on discounted amount and the Appellant issued the cheque for Rs. 3,62,000/- dated 18/01/2006 as full and final settlement. The Respondent was entitled to deposit the same as the customer had not paid the amount as per the assurance.

5. That as the settlement dated 18/01/2006 failed and Appellant had shown his inability to pay the previous settlement amount and requested for further consideration and the Respondent offered full and final settlement of Rs. 2,00,000/- as one-time payment and the Appellant issued cheque for Rs. 2,00,000/- dated 30/01/2009 as settlement amount as on that day”.

 

17. Perusal of the abovesaid affidavit shows that the OP wants this court to believe that the complainant settled the loan account and issued a cheque for an amount of Rs. 3,62,000/- on 18.01.2006 towards full and final settlement. At the cost of repetition, it may be mentioned here that the vehicle was repossessed on 14.06.2005. Once the re-possession of the vehicle took place, law did not permit the OP to seek any outstanding amount. OP has not placed on record any document towards the alleged settlement dated 18.01.2006. Perusal of the record shows that the cheque for an amount of Rs. 3,62,000/- and dated 18.01.2006 bears the cheque no. 5536136 which falls within the line of cheques admittedly given to the OP by the complainant at the time of sanction of loan. In other words, the cheque was already in possession of the OP on 18.01.2006. It was actually meant for the amount of EMIs of Rs. 28,375/- and that too during the continuation of the loan agreement.
18. Now coming to para 5 of the affidavit dated 15.05.2017 (reproduced above), OP stated that there was another round of settlement and the complainant on 30.01.2009 issued him anothercheque for an amount of Rs. 2 lakhs towards full and final settlement. Here again the relevant cheque bears the cheuqe number 553609. This chequeagain is from bundle of cheques given to the OP by the complainant at the time of sanction of loan on 30.01.2009. OP was not entitled to any amount as per law referred to above. Nothing on record suggests that the parties ever entered into the agreements dated 18.01.2006 or 30.01.2009 as alleged by the OP. OPin his written version in the District Forum stated that he was at liberty to use the security cheques by filing any amount and prosecute the complainant under section 138 of Negotiable Instrument Act. Relevant part ofpara 5 of the written version dated 06.03.2008 filed by the OP in the District Forum is reproduced below:

“It is also a fact that after the said deduction in the account a specific demand was raised by the respondent company from the complainant but he failed to clears the pending amount then the respondent company left with no other option but to use the security cheques and even when that cheque got bounced a specific notice was given to the complainant to clear the cheque amount when he failed to do so then the respondent company left with no other option but to file  a complaint under sec. 138 of N.I.Act against the complaint which is still pending for adjudication before the court.”

 

19. Admittedly the complainant had to face two criminal proceedings under section 138 of Negotiable Instruments Act because of the misuse of the cheques by the OP. OP has not only misused the cheques but has also filed a false affidavit in this Court. OPstated that the complainant voluntarily entered into settlements and gave the cheques on 18.01.2006 and 30.01.2009.
20. Hon’ble Supreme Court in the case of Ramrameshwari Devi v. Nirmala Devi &Ors., V (2011) SLT 196 referred to the common man’s general impression about litigation in the following words:

 

"Make any false averment, conceal any fact, raise any plea, produce any false document, deny any genuine document, it will successfully stall the litigation, and in any case, delay the matter endlessly. The other party will be coerced into a settlement which will be profitable for me and the probability of the court ordering prosecution for perjury is less than that of meeting with an accident while crossing the road."

 

This court in Swaran Singh (supra) observed as under:

"... ... ...Perjury has also become a way of life in the law courts. A trial Judge knows that the witness is telling a lie and is going back on his previous statement, yet he does not wish to punish him or even file a complaint against him. He is required to sign the complaint himself which deters him from filing the complaint. Perhaps law needs amendment to clause (b) of Section 340 (3) of the Code of Criminal Procedure in this respect as the High Court can direct any officer to file a complaint. To get rid of the evil of perjury, the court should resort to the use of the provisions of law as contained in Chapter XXVI of the Code of Criminal Procedure."

 

21. It is a matter of common knowledge that the Indian Courtsare flooded with casesunder section 138 of Negotiable Instruments Act. A large number of such cases are filed on false grounds. In the present case OP has filed two such false cases against the complainant. OP is a financer. Against how many borrowers it has filed false cases under Negotiable Instruments Act, is anybody’s guess. Consumer Protection Act 1986 provides for award of punitive damages against such service providers in respect of the aggrieved consumers who have not come to the courts of law. Keeping in view the enormity of the business carried on by the OP, I am of the view that the ends of justice shall be met if the OP is directed to deposit an amount of Rs. 50,00,000/- (Rs. Fifty Lakhs) in Consumer Welfare Fund of the State maintained by this Commission. OP is accordingly directed to deposit an amount of Rs. 50,00,000/- (Rs. fifty lakhs) in Consumer Welfare Fund of the State maintained by this Commission within a period of thirty days.
22. To sum up the abovesaid reliefs, the OP is directed to pay to the complainant an amount of Rs. 5,10,001/- alongwith interest @ 12% p.a. w.e.f. 26.04.2006 till the date of its realization. Let this amount be paid by the OP to the complainant within a period of thirty days from today failing which it shall carry interest @ 18% p.a. OP is also directed to deposit an amount of Rs. 50,00,000/- (Rs. fifty lakhs) in the Consumer Welfare Fund of the State maintained by this Commission within a period of sixty days from today failing which it shall carry interest @ 12% p.a. Complaint is accordingly allowed. Appeal is disposed of.
23. Copy of the orders be made available to the parties free of costs as per rules and thereafter the file be consigned to Records.

(N P KAUSHIK)
MEMBER (JUDICIAL)

 

1.