This case has arisen out of an application U/s 35 of the Consumer Protection Act, 2019.
The fact of the case is that Faijul Haque (since deceased) purchased a vehicle bearing Registration No:59A/7592 with the financial assistance of O.P/Finance Company & paid installment till February, 2020 but due to lockdown for Covid-19 RBI declared relief and O.P/Insurance Company was permitted to allow 03 months moratorium in respect of all term loan outstanding as on 1st March, 2020 and subsequent due dates and tenure of loan was shifted across the board by 03 months.
That owing to lockdown he could not use the vehicle & he failed to repay the installment of loan amount. When restriction were withdrawn while his vehicle was proceeding from Maynaguri towards Itahar then the men & agent of O.Ps without serving any notice upon him forcibly re-posses the vehicle at Fulbari which is illegal and void. He went to the office of the O.P.No:1 to pay installment amount of June, 2020 & on successive month but O.P.No:1 refused to receive the same. In the meantime he received a letter from O.P.No:1 dated 27.09.2020 whereby he was called upon to pay the balance amount of loan within 10 days i.d they would sale the vehicle without any notice. Due to negligent act of O.Ps he has been suffering from financial loss, mental pain & agony. He thus prays for direction upon O.Ps to return back the vehicle and not to sale or otherwise dealing with said vehicle, compensation of Rs.2,00,000/- for illegal re-possession, compensation of Rs.20,000/- for mental pain and agony and litigation cost of Rs.15,000/-.
O.P contested the case by filing W.V stating that they being the financier of 3116/HCV bearing Registration No:W.B59A/7592 had financed a sum of Rs.8,00,000/- on 29.05.2018 payable in 54 EMIs. It is true RBI had issued circulars and declared moratorium for various loans for an initial period of 03 months starting from March, 2020 to May, 2020, which could have been availed by a borrower by duly intimating the financer and opting for the same.
That Faijul Haque, borrower was a willful defaulter so the O.P has issued demand notice dated 09.11.2021 but he did not pay the dues. Consequently, O.Ps had to resort to the other provisions of Loan Agreement as per Law to recover the loan amount and thus upon demand, Faijul Haque surrendered the said vehicle and it was taken to possession of financer/O.P.No:2. The O.Ps have duly served pre-repossession notice on 12.09.2020 and the same was received by Faijul Haque. The process of re-possession was done upon request of Faijul Haque as per due process of law and not by force. There was no negligent act or latches on the part of O.Ps in any manner whatsoever and no cause of action has ever arisen against the O.Ps. So they prays for dismissal of the case.
Point for consideration is:-
- Whether there was any negligent act or latches on the part of the O.Ps which gives rise cause of action to file the complaint and the petitioners are entitled to get the claim?
D e c i s i o n w i t h r e a s o n s
Admittedly, the O.Ps being the financier of HCV/3116 bearing Registration No:W.B59A/7592 bearing Registration No:W.B59A/7592 had financed a sum of Rs.8,00,000/- on 29.05.2018, payable in 45 EMIs, of Rs.24,889/- each, first installment date 28 June, 2018 and last installment date 28 February, 2022, to Faijul Haque (borrower) and Sahanaj Khatoon (co-borrower/substituted petitioner No:1).
Loan account statement shows that EMIs up to 28.06.2019 have been paid by the borrower & on 19.06.2019 Cash Rcvd Receipt No:T12184500322-INR-25,000.00. Payment receipts show that O.Ps men received Rs.25,000/- by Receipt No:312127700487 on 31.07.2019, Rs.10,000/- on 24.11.2019 & Rs.24,900/- on 30.11.2019 (bears no receipt number), Rs.25,000/- by Receipt No:T12127708872 on 21.01.2020 & Rs.25,000/- on 31.02.2020 (wrong date-in Feb 2020) (bears no receipt number).
It is also admitted that RBI had issued circulars & declared moratorium for various loans for an initial period of 03 months starting from March, 2020 to May, 2020, which could have been availed by a borrower by duly intimating the financer and opting for the same.
Petitioner(s) replied the questionnaire of O.Ps stating that petitioner/Faijul Haque applied for the moratorium and also prayed before the O.P.No:1 for the moratorium.
O.Ps replied that any law passed by RBI need not be communicated. The circulars of the moratorium already known to the petitioner, was in the public domain of RBI website as well as everywhere in the news. As per the Circulars the O.P NBFC was permitted to grant moratorium but was not required to inform each and every customer regarding the moratorium. The question of relaxing any interest does not apply to the customers who have not chosen to seek the benefit of the RBI Circulars. The customer/Faijul Haque never sought to seek the benefit of the RBI circulars regarding the moratorium.
Be that as it may, petitioner/Faijul Haque had to pay EMIs after 03 months moratorium from June, 2020. Though petitioner(s) stated that he/they went to the office of the O.P.No:1 to pay EMI of June, 2020 & on successive month but O.P.No:1 refused to receive the same but no cogent corroborative evidence is found. On the other hand xerox copy of sale letter & letter regarding outstanding demand (submitted by petitioners) proved that the O.P/Insurance Company informed the borrower(s)-as on 09.09.2020 a sum of Rs.594870/- is payable towards full and final settlement of the loan and the breakup of the amount has been given, calling upon borrower(s) to make payment or to surrender the hypothecated Asset with original documents within 10 days from the date of the notice, in default, they have to enforce the rights under the agreement as on date of sale. Pre-sale letter to the customer dated 27.09.2020 speaks that-consequent to the default committed by the you under the said loan agreement, we afforded several opportunities to settle the same but you failed to utilize the said opportunities, hence we were constraint to take peaceful possession of the aforesaid vehicle on 26th September, 2020 by following due process and exercising the rights conferred under the said Loan agreement.
O.Ps replied that no force was applied during re-possession the proper inventory for re-possession was made. Inventory of the vehicle dated 25.09.2020 & inventory of items in vehicle dated 23.09.2020 are produced by the O.Ps which bears signature of Jaiul Sarkar (Annexure-A).
Annexure-B is the letter issued by S.S & Associates, Advocates, for O.Ps addressed to Faijul Haque & Sahanaj Khatun dated 09.11.2021 which runs as-you have failed & neglected to perform your part of obligation by defaulted in payment of installments and therefore, committed breach of the said agreement. In spite of repeated demands by O.Ps you have failed and neglected to pay dues of Rs.806507.77, calling upon you to pay said sum within 07 days from the date, otherwise O.P has no other alternative but to take such actions as per terms of the said Agreement against all of you including referring the matter to arbitration as per the Arbitration Clause mentioned in the Agreement for recovery of the amount due and also recovery of possession of the said vehicle without any further reference to you & the Agreement dated 29.05.2018 stands terminated and said letter was duly received by the borrowers on 08.12.2021 (as per Postal Track Consignment Report).
The petitioner(s) has/have cleverly did not disclose the date of taking re-possession of the vehicle by the O.Ps, only stating that when the vehicle was proceeding from Maynaguri to Itahar O.P’s men & Agent forcibly re-posses the vehicle in Fulbari which is illegal and void. Petitioner(s) replied that he/they went to the P.S but complaint was not received as there was Hypothecation Agreement.
Petitioner No:1 replied that an injunction in the form of mandatory was passed by Civil Judge (Junior Division), Raiganj whereby it was directed to return back the said vehicle in Case No:O.C-83/2020. Though it is stated that said order is being attached for ready reference but copy of the order has not been provided with the reply to the questionnaire.
The case laws referred by O.P in Re: Bharathi Knitting Company Vs DHL Worldwide Express Courier Division of Airfreight Ltd….(1996) 4 SCC 704.
When the complainant signs the contract document he would be bound by its term and onus would be on him to prove the terms and circumstances in which he signed the contract.
In Charanjit Singh Chadha And Others Vs Sudhir Mehra…. (2001) 7 SCC 417 the Hon’ble Supreme Court of India held:-
Terms of regular payment of installments had been violated by hirer, which gave right to financier for repossessing vehicle from hirer given to him under said agreement. Resulting, repossession taken by financier. In such circumstances, it can be said that there was no dishonest intention on part of financier.
In the Managing Director, Orix Auto Finance (India) Ltd. Vs Shri Jagmander Singh and Another (2006) 2 SCC 598 the Hon’ble Supreme Court of India held:-
Then on the occurrence of any such event, the right of the Hirer under this Agreement shall forthwith stand determined ipso facto without any notice to the Hirer and all the installments previously paid by the Hirer shall be absolutely forfeited by the Owner who shall thereupon be entitled to enter into any house or place where the said vehicle may then be, remove and retake possession of the same and to sue for all the installments due and for damage for breach of the Agreement and for all the costs of retaking possession of the said vehicle and all costs occasioned by the Hirer’s default.
If agreements permit the financier to take possession of the financed vehicles, there is no legal impediment on such possession being taken. Of course, the hirer can avail such statutory remedy as may be available. But mere fact that possession has been taken cannot be a ground to contend that the hirer is prejudiced.
In Anup Sarmah Vs Bhola Nath Sharma and Ors…(2013) 1 SCC 400 the Hon’ble Supreme Court of India held:-
The law can be summarized that in an agreement of hire purchase, the purchaser remains merely a trustee/bailee on behalf of the financier/financial institution and ownership remains with the latter.
In M/S Magma Fincrop Ltd Vs Rajesh Kumar Tiwari [SLP (c) No.33720 of 2018] the Hon’ble Supreme Court of India held:-
The Financier continues to remain the owner of a vehicle, covered by a hire purchase agreement till all the hire installments are paid and the hirer exercises the option to purchase.
The Hon’ble Supreme Court reiterated the view taken in the case of Charanjit Singh Chadha & Ors Vs Sudhir Mehra [(2001) SCC 417].
The citation Re: Shri Ram Transport Finance Vs Peraj Mavaji Chande dated 26.03.2021 of NDCRC, Gujarat State, Ahmadabad, in Appeal No:1045/2011 referred by the petitioners is not applicable as the factual matrix in said case is not similar to this case.
Under above facts and discussion, we are of the opinion that the borrower(s) was/were admitted defaulter who has/have failed to repay the dues in time as a result the O.P NBFC terminated the Agreement and after due service of notices took re-possession of the vehicle under the terms of the agreement as per due process of Law. The borrower(s) has/have failed to resort arbitration before filing this Consumer Complaint and Civil Case No:O.C 83/2020 & as he/they managed to get the injunction order from Civil Court the consumer complaint lost its merit. We, therefore, find no negligent act or latches on the part of the O.Ps which gives rise cause of action to file this Consumer Complaint and the petitioners (heirs of deceased principal borrower Faijul Haque) are not entitled to get relief as claimed.
In the result the case fails.
Hence, it is
O R D E R E D
that the C.C-46/2020 be and the same is dismissed on contest against the O.Ps but without any cost.
Let a copy of this order be given to the parties free of cost.
