FA.No.1371/2010 against C C.No.46/2010 District Forum, MAHABOOBNAGAR

Between

1. M/s.Bajaj Finance, Bajaj Auto Finance Limited,

    C/o.Padmini Bajaj, Authorized Bajaj Auto Vehicle

    Dealer, rep. by its Branch Manager, Pillalamarri

    Road, Mahaboobnagar.

2. M/s.Bajaj Finance, Bajaj Auto Finance Limited,

    Rep. by its Manager, D.No.12-13-1284, 4^th floor,

    Maspack house, Above spencers Market, Tarnaka

    Hyderabad.(Secunderabad)                                       ..Appellants/

                                                                                Opp.parties 1 & 2                                                                       

                And

B.Ramakrishna S/o.Krishnaiah, aged 27 years,

Occ:Agriculture, R/o.Charlathirumalapur Village,

Uyyalawada post, Tandoor Mandal, Mahaboobnagar Dist.  Respondent/

                                                                                complainant

Counsel for the Appellant             :  Mr. L.V.Vijay Shankar

Counsel for the Respondent          : M/s.V.Gourisankara Rao.

QUORUM: THE HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT,

AND 

SMT.M.SHREESHA, HON’BLE MEMBER,

WEDNESDAY, THE SIXTH  DAY OF JUNE,

TWO THOUSAND TWELVE

Order (Per Smt.M.Shreesha, Hon’ble Member)

***

        Aggrieved by the orders in C.C.No.46/2010  on the file of District Forum, Mahaboobnagar, opposite parties  preferred this appeal. 

The brief facts as set out in the complaint are that the complainant purchased Bajaj Discover 125 CC Motor cycle  under hire purchase scheme with the opposite parties.  The complainant submitted that the total cost of the vehicle was Rs.56,000/- and the opposite parties provided finance to a tune of Rs.33,000/- and the complainant has to pay the said amount in 18 EMI’s at Rs.2,065/- commencing from June, 2007 and he paid an amount of Rs.23,000/- towards down payment and handed over 18 post dated cheques.  The complainant submitted that the opposite parties encahsed Rs.12,390/- through 6 post dated cheques  and he paid Rs.4,830/- in cash to the authorized signatory of the opposite parties and in total an amount of Rs.17,220/- was paid.  The complainant submitted that he used the vehicle for 14 months only and due to problems in his agriculture, he could not pay the instalments in time and requested time for payment of due instalments and the opposite parties accepted the same but illegally without any notice seized the vehicle  on 24-4-2008.  The complainant approached opposite party No.1 for release of the vehicle several times along with documents and also promised to pay the total amount.  The complainant submitted that the total cost of the vehicle is Rs.56,000/- out of which he already paid Rs.40,220/- and he used for 14 months only and submitted that the opposite parties did not give any notice to the complainant for payment of the amount or any notice before seizure of the vehicle.  The complainant, therefore, got issued a notice on 23-3-2010 to the opposite parties through his counsel calling upon them to return the vehicle and expressed his intention to settle the account once for all for which they did not choose to reply.  Hence the complaint for a direction to the opposite parties to return Bajaj Discover 125 Motor cycle and receive the due loan amount or in the alternative to pay a sum of Rs.56,000/- with interest together with compensation of Rs.40,000/- and costs.

Opposite parties filed counter denying the averments made in the complaint.  They admitted financing Rs.36,000/- to the complainant under loan agreement No.551/003363 on 31-1-2007 fixing 18 monthly instalments to be paid @ Rs.2,065/- per month.  They submitted that the complainant is a chronic defaulter in payment of the instalments and was in arrears of Rs.56,685/- and as per the undertaking dated 31-1-2007, the opposite parties have taken possession of the vehicle on 31-8-2008. They stated that the complainant has paid the down payment of Rs.23,000/- to the dealer from whom he purchased the vehicle and the opposite parties are not concerned with the down payment made by the complainant.  They further stated that on 24-4-2010 they sent reply notice to the legal notice dated 23-3-2010  and submitted that the act of the opposite parties in taking possession of the vehicle is as per the terms of the loan agreement which is duly signed by the complainant and submitted that after taking possession of the vehicle, the loan agreement stands cancelled and the entire loan amount became due and payable and that inspite of repeated requests, the complainant has not come forward to settle the dues and hence they have sold the vehicle in question for highest bid of Rs.20,500/- and they incurred a loss of Rs.36,185/- and submitted that the question of return of the vehicle to the complainant does not arise and prayed for dismissal of the complaint.

Based on the evidence adduced i.e. Exs.A1 to  A6 and B1 to B5 and the pleadings put forward, the District Forum allowed the complaint in part directing the opposite parties to jointly and severally refund to the complainant, a sum of Rs.17,220/- paid by him towards instalment amounts and also further pay Rs.5,000/- towards compensation and costs of Rs.1,000/-.

 Aggrieved by the said order, opposite parties preferred this appeal.

            The learned counsel for the appellant contended that the District Forum erred in not appreciating the terms and conditions of the loan agreement, Ex.B3, and also the undertaking given by the complainant in Ex.B4 and submitted that the appellant has the absolute right to take possession of the vehicle in case of default in payment of EMIS and therefore there is no deficiency in service on their behalf.

        Exs.A1 and A2 evidences that the complainant has taken a loan  to his vehicle and was paying Rs.2065/- towards instalments.  It is not in dispute that the opposite party has rendered financial assistance of Rs.33,000/- of 18 instalments and that the complainant has not paid all the instalments but has paid only Rs.17,220/- as evidenced under Exs.A1, A3 and A4.  It is the complainant’s case that the opposite party has seized his vehicle on 24-4-2008 without giving any prior notice and inspite of his repeated requests that he would pay the balance amounts, the opposite party has sold the vehicle.  It is the further case of the complainant that he had got issued a legal notice dated 23-3-2010 (Ex.A6) requesting the opposite party to receive the instalments and return his vehicle, for which the opposite party replied vide Ex.B1 notice dated 24-4-2010 that the complainant was in arrears of Rs.56,685/- i.e. Rs.18,585/- towards instalment arrears and Rs.38,100/- towards over dues and therefore they have sold the vehicle on 23-12-2008 itself for the highest bidder price of Rs.20,500/- and have still incurred a loss of Rs.36,185/- and therefore there is no question of refund of any amount. 

                    The learned counsel for the appellant relies on terms and conditions reflected in Ex.B3.  A brief perusal of Ex.B3 show that clause 20 deals with the remedies in case of default and 20 A states that in case of default, by reason of cheque being dishonoured, the complainant shall initiate legal proceedings U/s.138.  It is not in dispute that the complainant has given 18 post dated cheques for the 18 instalments to be paid by him and the opposite party has not taken any action U/s.138 to recover the dues but instead has sold away the vehicle as admitted in Ex.B1 legal notice on 23-12-2008, when the vehicle was seized on 24-4-2008 without issuing any notice.  If the vehicle is sold without issuing any notice, the act of such a seizure of the vehicle,  amounts to unfair trade practice as laid down by the National Commission in Citicorp Maruti Finance Ltd. VS. S. Vijayalaxmi III (2007) CPJ 161 NC.  In the instant case, the opposite party repossessed the vehicle, without giving any notice and equally also sold it without giving any notice.  The opposite party cannot appropriate the amounts by selling away the vehicle illegally and then claim some more exorbitant amounts on the ground that the complainant has to still pay those amounts.  The sale of vehicle without giving proper notice amounts to unfair trade practice, hence we are of the considered view that the order of the District Forum  holding that there is  deficiency in service cannot be interfered with.  However, the District Forum awarded refund of Rs.17,220/- paid by the complainant towards instalments.  As admittedly the complainant has used the vehicle for a period of 14 months, we are of the considered view that 17,220 less 20% i.e. Rs.3,444/- = 13,776/- would meet the ends of justice.
          In the result this appeal is allowed in part and the order of the District Forum  is modified by reducing the  amount to Rs.13,776/- while confirming the rest of the order of the District Forum.  Time for compliance four weeks.

Sd/-PRESIDENT.

                                                                Sd/-MEMBER.

JM                                                             06-6-2012