CONSUMER DISPUTES REDRESSAL FORUM

PALAKKAD, KERALA

Dated this the 22^nd day of December, 2012.

Present: Smt. Seena. H, President

: Smt. Preetha. G. Nair, Member

: Smt. Bhanumathi. A.K, Member Date of filing: 15/02/2012

CC /38/2012

Rajan,

S/o. Late. Chamunni, - Complainant

Pezhumkode, Nochur P.O.,

Alathur Taluk, Palakkad

(BY ADV. M.C. Kuriachan)

Vs

Branch Manager,

Mahindra & Mahindra Financial Services Ltd.,

2^nd Floor, T.M. Complex,

Chandranagar, Palakkad – 678 013

(By ADV. Viju.K. Raphel) - Opposite party

O R D E R

BY SMT. PREETHA.G. NAIR, MEMBER

Case of the complaint is as follows :-

The complainant availed a loan from the opposite party by entering into an agreement with them for purchasing a Mahindra Tractor bearing No : KL9/R/4346. The loan amount was Rs. 3,25,000/- and the 1^st installment is Rs. 12,005/- and other installments were Rs. 11,930/- / to be repaid on 35 monthly installments for the total amount of Rs. 4,17,625/- . At the time of entering into loan transactions the opposite party has obtained 35 blank cheques, blank printed loan agreement and blank stamped printed form from the complainant. Also the opposite party has obtained the original R.C. Book from the complainant. In the loan account the complainant was paid the installments.

On 13/01/2009 one Raj Narayanan field officer of the opposite party came to the house of the complainant and intimated that if the complainant is remitting an amount of Rs. 10,330/- towards the loan account, the account will be closed and that will return the original R.C. Book , blank cheques and other documents obtained from the complainant as well as sureties and no objection certificate will be issued to remove the hypothecation endorsement. Then the complainant has intimated that if the amount pays towards loan account , it will be over and above the agreed sum of Rs. 4,17,625/-. So the complainant is not willing to pay that amount. Then Raj Narayanan had made to believe the complainant that the amount is arrived at including other office expenses and if he is paying the amount, he will be returned the documents.

Thereafter the complainant paid Rs. 10,330/-, on 13/01/2009 to Raj Narayanan for closing the loan account. Raj Narayanan had given receipt for that amount and endorsed loan account closed in the receipt kept in opposite party company. So the complainant had paid Rs. 4,49,835/- to the loan account instead of Rs. 4,17,625/-. Then the opposite party had given the R.C. Book to the complainant. But the opposite party had not given the other documents related to loan transactions and N.O. certificate. The complainant approached several times to the opposite party for demanding the documents. But the opposite party informed that the documents were in the custody of Head office and some more times needed to get back the documents.

Thereafter the complainant was not well. Again the complainant was approached the opposite party for demanding the documents. But the opposite party informed that the documents were not given by the Head office. On 30/09/2011 the opposite party sent a notice stating that balance amount of Rs. 48,168/- pay in the loan transaction. The complainant has not paid any amount to the opposite party. Also the complainant had paid the entire loan amount. The act of opposite party amounts to deficiency in service. Hence the complainant prays an order directing the opposite party to

1. Give the N.O. Certificate to cancel the hypothecation .

2. Pay Rs. 25,000/- as compensation for mental agony and pay the cost of the proceedings.

Oppsite party filed version sating the following contentions. The complainant availed a loan from the opposite party for purchasing a Mahindra 475 D1 Tractor. The amount financed was Rs. 3,25,000/- and the finance charges were Rs. 92,625/-. The complainant is a chronic defaulter in repaying the monthly installments and that has invited additional finance charges and other charges as per the terms of the agreement. The loan agreement value was Rs. 4,17,625/- and agreed to be repaid on 35 monthly installments of Rs. 11,930/-. The installment was agreed to be paid on 20^th day of every month and the date of the last installment was on 20/04/2008.

As per the loan account maintained in the opposite party company the complainant is liable to pay an amount of Rs. 48,168/- towards his liability in the loan transaction. At the time of disbursement of the loan to the complainant, the opposite party has got an endorsement of hypothecation under loan agreement in favour of the company in the Registration Certificate of the vehicle, as per the terms of the agreement. In case of default of payment by the complainant, the opposite party company is at liberty to repossess the vehicle hypothecated in its name as per the terms of the agreement. On enquiry it is also now understood by the opposite party that the complainant has handed over the possession of the vehicle under hypothecation to 3^rd party in violation of the terms and condtion of the loan agreement. It is true that one field officer has collected an amount of Rs. 10,330/- from the complainant. The collected amount is accounted in the loan account also. The opposite party has never obtained the original Registration Certificate from the complainant. The further allegation that Sri. Raj Narayanan had endorsed account closed in the documents kept in the oppsoite party company and that the complainant has paid an amount of Rs. 4,49,835/- towards the loan account is denied by the oppsite party. The opposite party had advised the complainant many a times to pay the balance amount towards the loan account immediately to avoid further interest and penal interest which fell in the deaf ears.

The opposite party has not acted in any derogation of law against the complainant. The complainant has not paid the entire dues towards the loan account and hence they had not legally bound to give N.O.C to the complainant to remove the hypothecation endorsement made in the Registration Certificate of the vehicle involved in the loan transaction. Moreover the opposite party has started action to recover the outstanding dues from the complainant. There is no deficiency of service from the part of the opposite party. Hence the opposite party prayed that dismiss the complaint with cost.

Both parties filed their affidavit and documents. Ext. A1 to A8 marked on the side of complainant. Ext. B2 to B4 marked on the side of opposite party. Both parties examed as PW1 and DW1. Heard Both parties.

Issues to be considered are

1. Whether there is any deficiency in service on the part of opposite party ?

2. If so what is the relief and cost?

Issue I & II

We perused relevant documents on record . Admittedly complainant availed a loan of Rs. 3,25,000/- from the opposite party and the finance charges were Rs. 92,625/-. The loan amount was agreed to be repaid on 35 monthly instalments of Rs. 11,930/- and the 1^st instalment was fixed as Rs. 12,005/- to be paid on the 20^th day of every month. Also the opposite party admitted that one of the field officer has collected an amount of Rs. 10,330/- from the complainant and the amount is accounted in the loan account. According to the opposite party as per the loan account maintained in their company the complainant is liable to pay an amount of Rs. 48,168/- towards its liability. In Ext A5 series cash receipt dated 24/06/05 shows that Rs. 35,655/- as the margin money.

As per Ext. B3 the total amount received from the complainant was Rs. 4,17,625/- the balance AFC due amount was Rs. 48,168/- on 27/06/12. As per Ext. B2 the loan period was 20/05/05 to 20/04/08. The last payment of complainant was Rs. 10,330/- on 13/01/2009. On verification of Ext. B3 the complainant is a defaulter in repaying the monthly installments. As per Ext. A6 the copy of pass book shows that the amount of Rs. 11,930/- withdrawn 8 times on several months. The opposite party argued that amount was mentioned in the 1^st 8 installments. In Ext. B3 20/07/2005 to 20/02/2006 the amount of Rs. 11,930/- debited.

After 20/02/2006 the opposite party has collected due amount in the complainant's account. At the time of cross examination of opposite party deposed that dishonour cheque was in their custody and if the customer will paid the cheque amount, the cheque will be returned to the customer. In Ext. A5 series cheque no. 300909 dated 20/03/06 for an amount of Rs. 11,930/- produced by the complainant. In Ext. B3 the amount of Rs. 11,930/- has not debited in the loan account. On 20/03/06 the installment amount of Rs. 11,930/- received on 23/05/2006 by cash on receipt no. 10189080. In Ext. A5 series the receipt also produced. The cheque return advice dated 14/08/2006 mentioned that the amount of Rs.12, 430/- as 27 installment received. In Ext. B3 the loan installment amount in 20/07/06 mentioned Rs. 1140/- received on 9/12/06, Rs. 4,000/- received on 15/12/06 and Rs. 6,790/- received on 28/12/06. Also in B3 no payment was received on 14/08/06 and 20/07/06.

The opposite party has not debited the amount of Rs. 11,930/- as per the receipt dated 20/03/06 and Rs. 12,430/- dated receipt 20/07/06 in the loan account. On that days the opposite party has debited due amount in the loan and adjusted the amount received on 23/05/06, 9/12/06, 15/12/06 and 28/12/06. The due amount received on 20/03/06 was 64+753= Rs.817/-. The due amount received on 20/07/06 was Rs. 2,273/-. At the time of cross examination opposite party deposed that the amount in the cheque return advice dated 14/08/06 no amount received by them. But that receipt issued by the opposite party and also signed. No Contradictory evidence produced by the complainant. The field officer Raj Narayanan was not examined as a witness, by the opposite party.

In the above discussions we are of the view that there is deficiency in service on the part of opposite party. In Ext. A5 series one installment paid by the complainant as per the cheque dated 20/03/06. But the opposite party has not debited that amount in the loan account and also collected as dues. The complainant paid Rs. 11,930/- to the opposite party. In that period opposite party has collected Rs. 817/- as the dues and AFC amount. Total amount was Rs. 11,930/- + Rs. 817/- is Rs. 12,747/-. In Ext. B3 dated 27/06/12 the balance amount was Rs. 48,168/- deducted Rs. 12,747/- balance amount is Rs. 35,421/- further interest deducted due to the litigation period. As per Ext. B3 the complainant is liable to pay an amount of Rs. 48,168/- in the loan transaction. The loan of last installment was on 20/04/2008 and the complainant paid the last installment amount of Rs. 10,330/- on 13/01/2009.

In the result complaint partly allowed. We direct the complainant to pay Rs.35,421/- ( Rupees Thirtyfive thousand Four hundred and Twentyone only) as the due amount to the opposite party. Also directed the opposite party to give the NOC for cancelling the hypothecation of tractor No. KL9/R/4346 on receipt of Rs. 35,421/- and pay Rs. 3000/-( Rupees Three thousand only ) as cost of the proceedings to the complainant.

Order shall be complied within one month from the date of receipt of order, failing which the complainant is entitled for 9% interest per annum for the whole amount from the date of order till realization.

Pronounced in the open court on this the 22^nd day of December, 2012.

Sd/-

Smt. Seena. H

President

Sd/-

Smt. Preetha.G.Nair

Member

Sd/-

Smt. Bhanumathi.A.K

Member

A P P E N D I X

Exhibits marked on the side of complainant

Ext. A1– copy of R.C. Book dtd. 23/07/05.

Ext. A2- Copy of finance scheme sent by the opposite party dtd. 24/06/05.

Ext. A3- Copy of receipt sent by the opposite party dtd. 13/01/09.

Ext A4- Copy of notice sent by the opposite party to the complainant dtd. 30/09/11.

Ext. A5- Cash receipts in 35 nos on A5 series.

Ext. A6- Copy of pass book by the complainant to pass the cheques to the opposite party.

Ext.A7 – Copy of notice sent by the opposite party to the complainant dtd. 30/09/11.

Ext. A8- Letter of Arbitration sent by the complainant to the opposite party dtd.18/08/11.

Exhibits marked on the side of opposite party

Ext. B2- Copy of the agreement between Complainat and opposite party dt. 24/06/05.

Ext. B3- Copy of the computer print out of the ledger account.

Ext. B4- Copy of the finance scheme between complainant and opposite party.

Witness examined on the side of complainant

PW1 - Rajan

Witness examined on the side of opposite party

DW1 – Prathesh. A.C.

Cost allowed

Rs. 3000/- (Rupees Three Thousand only) allowed as cost of the proceedings.