Order-22.
Date-13/07/2015.
This is an application u/s.12 of the C.P. Act, 1986.
Complainant by filing this complaint has submitted that he availed of a part gold loan against Loan Account No.PPL No.2622 from the OP on 18-08-2011 for an amount of Rs.1,88,000/- against gold ornaments weighing grossly around 261.50 grams. The net weight as reflected by the OP is 93 grams whereas the gross weight of the gold ornaments against which the loan as availed of is 261.50 grams and the value of the gross gold ornaments on the date of availing the loan was Rs.6,80,000/- as per the bullion market rates.
Fact remains OP undertook to serve a copy of the agreement signed by the complainant, which they never served and so the complainant was totally in dark about the status of his loan account.
Complainant was not aware of any information regarding the rates of the contractual charges applicable and repayment/recovery procedures and the OP did not took any reasonable steps to inform the complainant about the same and the complainant signed the agreement on utmost good faith and it is best known to the OP why the OP has managed to maintain a stoic silence and never informed the complainant about the status of the said Loan Account being PPL No.2622 for a considerable period of time about the status of the same and after more than one year the complainant came to know from reliable sources that his Gold as pledged has been sold through auction and to confirm the same, the complainant through a legal notice demanded relevant documents about auction or pertaining to the loan sanctioned what the OP tactfully denied the same through his Ld. Advocate on 04-06-2013 and on going through the legal reply complainant knew that the OP has already auctioned the said gold as pledged on 30-01-2013 and on enquiry only they disclosed the details.
Further it is submitted that OP issued the first notice on 04-06-2013 for the repayment of the outstanding dues pending even after the public auction of the gold ornaments pledged to the respondent after the legal notice served upon the respondent. The complainant would like to state here that the complainant came to know about the auction/sale of the gold ornaments as pledged from the reply of the OP and the OP for reasons best known to him has not only maintained a stoic silence about the mounting due amount for a considerable period of time but also auctioned the gold ornaments without any communication or intimation of the same to the complainant. OP has deliberately avoided the auction process and have deliberately sold the pledged gold by under-valuing when the market value of the pledged gold at the time of auction as on 30-01-2013 was Rs.7,60,000/- even if the authenticity of the claim of the OP amounting to Rs.2,33,000/- along with interests is correct and even if it is presumed so, the OP has not provided with any strict proof of the same. The OP did not take any initiative to refund back the excess amount of Rs.5,27,000/- what the OP has realized in excess by auctioning the gold ornaments as pledged.
OP has also deliberately kept the complainant out of loop about the auction and only upon confronting the status about the loan, came up with the demand notice dated 04-06-2013 behind the back of the complainant and to save their skin sold it and in fact complainant received only legal notice dated 04-06-2013 from the OP which clearly shows the negligent and deficient manner of service on the part of the OP and OP did not render service to the complainant with ulterior motives and in the above circumstances, complainant prayed for refund of the balance amount of the total price of the gold and also for compensation etc.
On the other hand, OP by filing written statement submitted that the entire complaint is false and fabricated. Complainant miserably failed and neglected to comply with the terms of the agreement and hence the gold ornaments pledged as collateral security has been auctioned after giving sufficient notices to the complainant but the complainant has not taken any steps within the time specified so the auction was made.
Fact remains complainant took loan being No.PPL 2622 on 18-08-2011 for a maximum period of 12 months and the terms and conditions as stipulated in the pledged in the pledge form/agreement/receipt issued to the complainant while granting loan to the complainant and complainant agreed to the terms and conditions and the gold jewellery pledged as collateral security is 93 grams(net) against gross weight of 261.5 grams. The net gold of the jewellery was only 93 grams as per the auditor’s report and the remaining weight covers the stud, dirt, rod, stone and other foreign materials which has no value by selling the same. The net gold only can be sold in auction and the said loan was to be closed within maximum 12 months and further terms was to pay the monthly agreed interest and in fact complainant took loan of Rs.1,88,000/- but he neither paid the monthly interest nor renew the account and hence as per rules, the collateral security was put to auction after service of the registered notice by registered post and further by proper publication.
It is specifically mentioned that the legal notice of the complainant sent after the auction of the gold ornaments was made so the notice was infructuous and all the formalities was complied for auction and hence the allegation of the complainant is purely baseless.
It is specifically mentioned that the auction of the gold ornaments is made in a lot of 1 kg. etc. and on the basis of the purity of the gold the bidding was done and for which the stone, dirt, rod, stud etc. were removed from the same and then the actual weight of the gold was determined. The auction bidder gave the offer on gold only and not of other foreign materials such as stone, dirt etc. So, the complainant’s calculation on the basis of bullion rate on the gross weight was baseless and the same was done with lack of knowledge and/or with mala fide intention. In fact there was no negligence on the part of the OP since OP performed the duties and responsibility and complainant did not comply the same, so, no cause of action arose and for which the present complaint should be dismissed.
Decision with Reasons
On comparative study of the complaint including the written version and also on proper assessment of the document and the argument as advanced by the Ld. Lawyers it is found that complainant prayed for gold loan to the OP on 18-08-2011 by depositing gold an total 15 items of ornaments were deposited and weight was 93 grams deducting other parts of the said ornaments and fact remains Rs.1,88,800/- was released as loan and accordingly complainant received in cash Rs.1,88,000/- on 18-08-2011.
From the details of gold ornaments offered as collateral security it is found that at the time of preparing the details of the particulars of the gold ornaments the weight of the total gold ornaments was 260.50 grams but actual weight of the gold part was 93 grams and that was decided by their gold experts and that form was also filled up and complainant signed there as borrower and value of the gold at that time was fixed Rs.1,59,000/- that is as on 18-08-2011 and that loan was sanctioned based on the above declaration and subject to condition as noted but nowhere the interest rate is noted in the documents produced by the OP.
Most interesting factor is that in the undertaking sanctioned letter produced by the OP it is found that in the column “received back the ornaments given as collateral security”. Signature of the borrower is also there and further there is a declaration that on demand complainant shall have to pay Rs.1,59,000/- only but there is no note about interest or final amount and everything is blank. Similarly, in the application form no interest rate is noted but in all the papers produced by the OP there is signature of the borrower. Considering that fact it is clear that OP managed to procure the signature of the borrower in the blank forms. Thereafter, it was filled up by the OPs and now, it is produced but even then it is found that even after selling the said gold in so called auction OP managed to procure the signature of the borrower (complainant) “received back the ornaments given as collateral security”, it indicates that in all papers only signatures were collected and for the sake of the argument undertaking cum sanctioned letter is taken into account in that case OP shall have to prove how complainant received back the ornaments given as collateral security. Another factor is that OP has failed to produce any documents to show that complainant received back said gold ornaments but OP has failed to prove that they sent any demand notice that was served upon the complainant duly before auction of the said gold, at the same time OP has failed to produce any document to show that in respect of the present loan account auction bid was given by expressing that the complainant has failed to pay the amount with interest. No such document is produced to show that auction sale was made against that loan account. The OP has tried to convince that it was sold along with other gold but that is not the provision of law because in respect of each and every gold loan account if OP wants to sell the gold in that case certain procedure should be followed by the OP Finance Company/Authority but that was not been followed and no doubt such sort of sale without any valid auction is unpredictable and against the law and such an act on the part of the present company is found no doubt an unfair trade practice and for that act of OP no doubt complainant has suffered much when he failed to get any chance to pay the said amount and in fact OP has also failed to prove by producing any such document to show what was the rate of interest in their document against interest column and everything is blank that means they only collected signature and as per their wish they will put their interest rate but in this case failed to put it and some blank portions along with copy of the documents are produced by the OP which is sufficient to prove that the mal-practices has been practiced by the OPs in most of the cases and particularly in this case.
Moreover, OP tried to convince that rate of interest is noted in a separate sheet but truth is that in that sheet there is no signature of the complainant then it is clear that everything was prepared at the behest of the OP Mathoot Finance Ltd. and no doubt they are very much well-known in grabbing money by such a manner and all over the West Bengal they have running such a business by practicing fraud without giving proper service to the customer giving no contract or agreement or rate of interest or about the rate of gold also and everything is done at their behest which is proved in the present case. Truth is that there is no interest rate in the documents or in the loan sanctioned order or in their other papers but in one paper interest rate is noted but peculiar factor is that in that page there is no signature of the complainant then it is not the interest rate as claimed by the OP and for which same is not binding upon the complainant and so unfair trade practices as adopted by the OP is well proved and considering the above fact and illegal selling of this gold we are convinced to hold that OP did not render proper service and they acted illegally and in various ways illegally they sold away the gold and for which complainant is entitled to get such relief treating that the complainant’s loan account is finally closed when OP got such amount from the market after selling such gold without adopting any legal procedure or auction and at the same time for harassing the complainant and for loss of the market price of the ornaments complainant is entitled to some compensation also for adopting unfair trade practice and further for causing mental pain and agony to the complainant and causing financial loss to the complainant this complaint succeeds.
Hence,
Ordered
That the case be and the same is allowed on contest with a cost of Rs.3,000/- against the OP.
OP is directed to pay a sum of Rs.2 lakhs for selling the said gold ornaments in auction without adopting any valid procedure of auction and also for causing financial loss to the complainant for selling the said gold illegally and further for realizing the huge amount by selling the same OP has caused financial loss to the complainant for which OP is directed to pay a sum of Rs.2 lakhs as compensation to the complainant and also for causing mental pain and agony and sufferings and it shall be paid within one month from the date of this order and the entire loan account of the complainant shall be treated as finally closed down as settled finally.
If OP fails to comply that order in that case OP shall have to face consequences proceeding u/s.27 of the C.P. Act for which further penalty and fine shall be imposed and further shall have to pay penal interest over the said amount at the rate10 percent p.a. till full realization of the same.
