::BEFORE THE DISTRICT CONSUMER DISPUTES  REDRESSAL COMMISSION AT BIDAR::

                                                             C.C. No.38/2024.

                                                                                                                            Date of filing: 01.04.2024.

                                  Date of disposal:20.09.2024.

P R E S E N Ts:-    

                                (1) Shri. Mabu Saheb H.Chabbi,                                                                                                               B.Com.,LL.B.,(Spl.),

                                                                               President.,  

                                (2) Kum. Kavita,

                                                               M.A.,LL.B.,(Spl.),  

                                                                         Member.

COMPLAINANT/S                     Shantamma W/o Vijaykumar,                                                  
                                                       Age: 56 years,Occ:Household and Agriculture,                                                         

                                                       R/o Kumar Chincholi Tq:Humnabad Dist:Bidar.                                                  

                                                  (By.Sri.Ravindra M.Jaidoddi Advocate.)   

                                                                                                                       V/s

OPPONENT/S                         1. Branch Manager,

                                                    Cholamandalam Investment and Finance
                                                    Co. Ltd. Bidar, Mahadeve Nagar
                                                    Opposite Lahoti Maruti Suzuki showroom 
                                                    Bidar.                                                                                

                                                   (By Sri. S.M.Shetkar Advocate).
           

                                                                                                     ::  J U D G M E N T  ::

By. Kum.Kavita Member.           

The complaint is filed by the complainant under section 35 of the Consumer Protection Act 2019, against the opponent for the deficiency in service caused by not releasing the seized vehicle by receiving loan premiums by OP.  Hence, passed the following judgement. 

Brief facts of the complaint.

The brief facts of the complaint are as follows: -

2.         The OP has sanctioned the loan of Rs.8,10,000/- on 18.05.2023 to the complainant for purchasing Tractor with the condition to repay the loan in 10 equal half yearly installments of Rs.1,15,350/-.  Accordingly the complainant has purchased John Deere 5050D Tractor Bearing Chassi No.1PY5050DCPA051625 and bearing Engine No.PY3029D735818 and got hypothecated with the OP Finance but, due to some technical defects complainant was not able to make use the tractor for the purpose for which it has been purchased and sustained heavy loss.  The complainant got insured the said vehicle and got the vehicle registered with concerned Office having its registration No.KA.39/T7843.  The complainant could not able to pay the 1^st installment of loan for the aforesaid reasons, then the OP finance without giving any opportunity and without giving any notice, the OP has illegally seized the above said vehicle through its agent.  The OP or the seizing agency has not issued any notice to the complainant prior to seizing the vehicle and hence, it is clear violation of terms and conditions of agreement and violation of law.  The complainant got ready to pay the balance premium at the time of 2^nd installment due by barrowing a private loan.  But, the OP   has not heeded the request of complainant and seized his vehicle without complying the provisions of law and the agreement, the complainant got insulted in the society and caused mental shock and agony due to the illegal act of OP finance.  The complainant got issued legal notice through his advocate to release the vehicle and sought for some time to clear the due loan installments.   Though the notice was served to the OP but, the OP has not replied to the said notice and not released the vehicle.  Hence, this complaint against the OP for the release of vehicle in favour of him by receiving due installment as per the loan agreement.   

Written Version of OP.

3.         The notice issued by this commission to the OP is served upon him and the OP appeared through his counsel before this commission and filed his W.V. and the gist of the W.V. of OP is as below.

            The OP admitted the fact of sanction and availing loan of Rs.8,10,000/- to the complainant for the purchase of Tractor and the said tractor was hypothecated for the loan with the OP.  Further it is true that, the loan installment of Rs.1,15,350/- to be paid by the complainant in 10 equal half yearly installments.   It is false to say that, due to technical defects the complainant was not able to make use the Tractor and due to that sustained heavy loss.  As per the loan agreement the complainant has to pay the 1^st loan installment from 18.11.2023.  But, the complainant has not paid the loan installment as agreed by him, and committed default in making payment and as per serial No.11 of Article 10 of loan agreement, the barrower shall bound to deliver the vehicle to the OP with the original documents of the vehicle.  The complainant has not surrender his vehicle to the OP nor paid any loan due installments, then the OP has issued final call letter on 08.01.2024 including to the guarantor but, had not paid 1^st installment then the OP  issued intimation to the police before taking possession of the vehicle.  After taking possession of the vehicle the OP has issued pre-sale letter dt:08.02.2024 to the complainant to arrange to pay loan amount with parking charges within 10 days but, the complainant has not turned up to clear the installment, then the OP was constrained to sell the vehicle in an auction conducted by the OP on 27.02.2024 for a sum of Rs.5,81,000/-.  The notice said to be issued by complainant was not served to the OP.  The OP has sold the vehicle in an public auction with due process of law and according to the terms and conditions of the agreement.  The OP has issued notice to the complainant as well as guarantor to settle the loan account, but the complainant has not settled the loan due by him to the OP.  As per the loan cum hypothecation agreement the complainant has agreed and undertaken to get resolve all the disputes, claims or difference, opinion in respect of vehicle loan transaction through a process of arbitration, but without exhausting the remedy before arbitration the complaint of the complainant is not maintainable.  The complainant is  not a consumer he is a barrower and the OP is the creditor and hence, the OP prays to dismiss the complaint. 

Evidence of complainant.

4.         The complainant herself got examined as P.W.1 and got marked documents Ex.P.1 to Ex.P.6 which are as follows,

1. Ex.P.1-Copy of notice to the complainant and guarantor dt:28.03.2024.
2. Ex.P.2-Copy of RC Card of complainant.
3. Ex.P.3-Copy of repayment schedule issued by OP dt:20.12.2023.
4. Ex.P.4-Copy of tax invoice.
5. Ex.P.5-Copy of personal accident insurance policy.
6. Ex.P.6-Copy of hospital cash insurance policy.

Evidence of Opponents.

5.         One, Sri.Vishwanath S/o Revanna  Byakod, Executive legal GPA holder of OP has been examined as R.W.1 by filing his evidence affidavit on behalf of OP and got marked 09 documents, those are as below. 

1. Ex.R.1-Copy of loan application.(4 pages)
2. Ex.R.2-Copy of loan agreement.(8 pages)
3. Ex.R.3-Copy of schedule of agreement.
4. Ex.R.4-Copy of final call letter dt:08.01.2024.(4 pages)
5. Ex.R.5-Authorisaton letter to seize the vehicle dt:03.02.2024.
6. Ex.R.6-Intimation to police before taking possession of the vehicle dt:03.02.2024.
7. Ex.R.7-Copy of post seizer intimation to police stationdt:07.02.2024.
8. Ex.R.7(a)-Postal receipt.
9. Ex.R.8-Copy of pre sale letter to the customer dt:08.02.2024.(4 pages)
10. Ex.R.9-Copy of auction proceedings.  (6 pages)

Points/Issues.

6.         Complainant has submitted her written argument.  Heard the argument advanced by the parties.  On perusal of the pleadings and the documents of the parties, this commission raised the points for consideration as below;

1. Whether the complainant proves that, she is consumer to the OP and further proves the deficiency of service caused by the OP in not fallowing the terms and conditions of the agreement?
2. Whether the complainant is entitled for any relief as sought in her complaint?

3. What orders? 

7.         Our answers to the points raised above are as follows: -

1. In the affirmative.
2. In the affirmative.
3. As per the final order.

Points No 1 and 2.

8.         In order to decide the complaint issues, this commission discussed points/issues No.1 and 2 together, as each points are inter related to each other- as follows.

9.         In order to prove the case of the complainant the complainant has lead her evidence as P.W.1 by way of reiterating the complaint facts and got marked Ex.P.1 to Ex.P.06 documents on her behalf.  One,
Sri. Vishwanath S/o Revanna  Byakod, Executive legal of OP finance has filed his evidence affidavit and got reiterated the contents of W.V. in his evidence affidavit and got marked 09 documents to establish the defence. 

10.       The case of the complainant is that, the OP has sanctioned the loan of Rs.8,10,000/- on 18.05.2023 to the complainant for purchasing Tractor with the condition to repay the loan in 10 equal half yearly installments of Rs.1,15,350/-.  Accordingly the complainant has purchased John Deere 5050D Tractor Bearing Chassi No.1PY5050DCPA051625 and bearing Engine No.PY3029D735818 and got hypothecated with the OP Finance but, due to some technical defects complainant was not able to make use the tractor for the purpose for which it has been purchased and sustained heavy loss.  The complainant got insured the said vehicle and got the vehicle registered with concerned Office having its registration No.KA.39/T7843.  The complainant could not able to pay the 1^st installment of loan for the aforesaid reasons, then the OP finance without giving any opportunity and without giving any notice the OP has illegally seized the above said vehicle through its agent.  The OP or the seizing agency has not issued any notice to the complainant prior to seizing the vehicle and hence, it is clear violation of terms and conditions of agreement and violation of law.  The complainant got ready to pay the balance premium at the time of 2^nd installment due by barrowing a private loan.  But, the OP   has not heeded the request of complainant and seized his vehicle without complying the provisions of law and the agreement, the complainant got insulted in the society and caused mental shock and agony due to the illegal act of OP finance.  The complainant got issued legal notice through his advocate to release the vehicle and sought for some time to clear the due loan installments.   Though the notice was served to the OP but, the OP has not replied to the said notice and not released the vehicle. 

11.       The main contention of the complainant is that, the OP has not issued any prior notice to the complainant to seize the vehicle tractor bearing its Reg.No.KA.39/T7843 from the complainant.  The OP has denied the contention of the complainant and asserts that he has issued notice to the complainant before seizing vehicle and also issued pre-sale notice to the complainant as per Ex.R.4 and Ex.R.8 respectively.  The complainant denied the service of said notice and pre-sale notice said to be issued by OP to the complainant as per Ex.R.4 and Ex.R.8.  The OP has produced postal receipt report along with Ex.R.4 final call letter dt:08.01.2024 that, the said final call letter to the complainant as well as to the guarantor was issued through register post under reference No.FFC0801202415424, which shows the same register postal receipt number in the list annexed with Ex.R.4.    The OP has also produced Ex.R.8 the copy of presale letter said to be issued by the OP to the complainant as well as to the guarantor on 08.02.2024 through register post reference No.PRESALE080220241265.  The OP has also produced the said register postal receipt list containing the same number annexed with Ex.R.8.  But, the OP has not produced any such postal acknowledgement receipts or any postal track report for having served both the document Ex.R.4 and Ex.R.8 to the complainant.  The OP is able to show before this commission that, Ex.R.4 and Ex.R.8 final call letter and presale letter issued through register post to the said complainant.  But, the OP has failed to prove the service of said above two documents to the complainant and hence, it cannot be considered that the said final call letter as per Ex.R.4 and presale letter as per Ex.R.8 were served to the complainant and to the guarantor. 

12.       On going through Sl.No.11(a)(i) of Ex.R.2 copy of loan agreement, “notice-in case of any default in repayment including an occurrence of any of aforesaid events of default and/or failure to surrender the asset as mentioned here in above, the company shall cause 7 day notice to be issued barrower at his address as registered with the company”.  Further it was mentioned in the same Sl.No.11(a)(iii), “post repossession-upon taking possession of the asset as a final chance to rectify the default, a 7 days notice shall be caused by the company to the barrower to repay the termination price (which includes the charges and expenses incurred for taking possession of the asset including the legal expenses)”.  On going through these clauses under Sl.No.11 of loan agreement, it is mandatory on the part of the OP to issue notice before seizer of vehicle and also it is mandatory on the part of the OP to issue notice to the complainant before putting the vehicle in auction.  Before parting with the auction proceedings for the said vehicle, the OP must see that, whether the presale notice was served to the complainant or not and without complying that, aspect the OP has conducted the auction of the said vehicle is itself against to the terms of Ex.R.2.  But, in this case the OP has failed to establish the fact of issuance of notice before seizer and before the auction of the said vehicle as per law.  The mere proof of issuance of notice and presale notice as per Ex.R.4 and Ex.R.8 does not hold any legality without there being any proof of service of said notices to the complainant.  In view of these facts we find that the deficiency of service caused by the OP towards the complainant by non-complying the terms and conditions of the loan agreement by OP himself. 

13.       The OP has raised objection in his W.V. that, without invoking the process of arbitration as agreed in the terms of loan agreement, the compliant before this commission is not maintainable and sought for dismissal of the complaint.  As per the provisions of Section 100 of C.P.Act 2019 the provisions of the C.P.Act shall be in addition to and not in derogation of the provisions of any other law for the time being in force.  In view of this provision, the complainant can file the complaint before this commission without exhausting any remedy before arbitration.  Hence, the contention of the OP cannot be accepted. 

14.       The loan sanctioned by the OP for Rs.8,10,000/- to the complainant for purchasing the tractor and execution of loan cum hypothecation agreement in between parties is not in dispute by the parties.  But, the OP contended that, the complainant is the barrower and the OP is the creditor to the loan of the complainant and hence, the complainant cannot be considered as consumer to the OP.  This contention of the OP cannot be accepted by this commission because the creditor has not provided the service to the barrower as per the terms and conditions of the loan agreement executed by the complainant and for such violations of the terms of agreement the barrower can approach before the consumer commission as a consumer to redress his rights from the OP.  Hence, the complainant is considered as consumer and the OP is considered as service provider to the complainant. 

15.       The complainant has produced Ex.P.2 the copy of certificate of registration pertaining to his vehicle, Ex.P.3 is the copy of repayment schedule, Ex.P.5 and Ex.P.6 copies of insurance policy documents have not been disputed by the OP and the documents produced by the OP as per Ex.R.1 the copy of loan application form, Ex.R.3 copy of loan schedule are not in dispute and the discussion of the above said document is not required. 

16.       The OP has produced Ex.R.9 the copy of auction proceedings of the vehicle pertaining to the complainant.  In the said auction conducted by the OP, the said vehicle was sold for Rs.5,81,000/-.  The OP has issued letter after alleged auction to the complainant on 28.3.2024 as per Ex.P.1 regarding the sale proceeds received from the highest bidder for Rs.5,81,000/- and it was said to be adjusted to the outstanding loan of Rs.8,83,052/- and the OP sought to recover remaining Rs.3,11,114/- including 3% interest p.a. from 27.02.2024 to 28.03.2024 for Rs.9,062/-.  This commission cannot accept Ex.R.9 the document regarding the auction of the vehicle conducted by the OP without proper service of notice and further document Ex.R.5 authorization letter to seize the vehicle to police dt:03.02.2024, Ex.R.6 intimation to police before taking possession of the vehicle dt:03.02.2024 and Ex.R.7 the copy of post seizure intimation to police dt:07.02.2024 cannot be accepted as proper and legal.  The OP has seized the vehicle without due service of notice to the complainant is not proper and legal and hence the subsequent act of OP regarding auction and sale of vehicle to the third party cannot be accepted as proper.  If the presale notice served properly to the complainant, then the complainant would have been participated in the auction proceedings and allowed the complainant to claim his vehicle by clearing the loan due installments, but in this case the OP has not given any opportunity to the complainant by serving the notice as per law and due to the unfair trade practice played by the OP, causes huge loss to the complainant and caused deficiency of service to the complainant.   

17.       The complainant has produced Ex.P.4 the Tax invoice regarding the purchase of tractor for Rs.11,50,000/-.  Though the OP sanctioned the loan of Rs.8,10,000/- but the OP seized the vehicle worth Rs.11,50,000/- on 03.02.2024 and hence the OP is liable to release the said tractor or to pay Rs.11,50,000/- (Rs.8,83,052/- as on 27.02.2024 and out of this if we deduct the loan of Rs.8,10,000/- the remaining amount of Rs.73,052/- the due amount by the complainant shall have to paid to the OP) by excluding Rs.73,052/- i.e., Rs.10,76,948/- is to be paid by OP to the complainant to facilitate the complainant to purchase the tractor.  In view of the above said discussion made by this commission, the complainant is entitled to get back his tractor or Rs.10,76,948/-  with the reschedule of loan account from the OP.  The complainant has proved his case as against OP for the deficiency of service caused to the complainant.  Accordingly we answered the point No.1 and 2 in the affirmative in favour of complainant and proceed to pass the fallowing order. 

                                                                                                          ::ORDER::

        The complaint u/s 35 of CP Act 2019, filed by the complainant against OP is hereby allowed in part along with costs and compensation.

            The OP is hereby directed to release the complainant tractor bearing its Reg.No.KA.39/T7843 in a running condition to the complainant or to pay an amount Rs.10,76,948/- (Rupees ten lakh seventy-six thousand nine hundred forty-eight only) to the complainant within 45 days from  the date of order and further the OP is hereby directed to reschedule the loan account on Rs.8,10,000/- with effect from the date of release of the said tractor or as on the date of payment of Rs.10,76,948/- to the complainant by the OP, the terms and conditions of the agreement and its reschedulement applicable thereon for Rs.8,10,000/- between the parties.            

The OP is further directed to pay compensation of Rs.20,000/- and litigation charges of Rs.5,000/- to the complainant.

            Intimate the parties accordingly.  

 (Typed to our dictation then corrected, signed by us and then pronounced in the open Commission on this 20^th day of September-2024).

Documents produced by the complainant.

1. Ex.P.1-Copy of notice to the complainant and guarantor dt:28.03.2024.
2. Ex.P.2-Copy of RC Card of complainant.
3. Ex.P.3-Copy of repayment schedule issued by OP dt:20.12.2023.
4. Ex.P.4-Copy of tax invoice.
5. Ex.P.5-Copy of personal accident insurance policy.
6. Ex.P.6-Copy of hospital cash insurance policy.

Document produced by the Opponent.

1. Ex.R.1-Copy of loan application.(4 pages)
2. Ex.R.2-Copy of loan agreement.(8 pages)
3. Ex.R.3-Copy of schedule of agreement.
4. Ex.R.4-Copy of final call letter dt:08.01.2024.(4 pages)
5. Ex.R.5-Authorisaton letter to seize the vehicle dt:03.02.2024.
6. Ex.R.6-Intimation to police before taking possession of the vehicle dt:03.02.2024.
7. Ex.R.7-Copy of post seizer intimation to police stationdt:07.02.2024.
8. Ex.R.7(a)-Postal receipt.
9. Ex.R.8-Copy of pre sale letter to the customer dt:08.02.2024.(4 pages)
10. Ex.R.9-Copy of auction proceedings.  (6 pages)

Witness examined.

Complainant.:-

P.W.1- Shantamma W/o Vijayakumar,      (complainant).   

Opponent:- 

R.W.1- Sri.Vishwanath S/o Revanna  Byakod, Executive legal GPA holder of OP.