MR LAXMI NARAYAN PADHI, PRESIDENT… The case in brief is that, the complainant is the owner of one AL-ACV-1613 Truck of Ashok Leyland of 2006 make bearing Registration No. OR-05-4858.He for maintenance of the vehicle sought financial assistance from O.P.3 through their local agent which was granted for Rs.1,82,000/- on dt. 30.06.2014, scheduled to be repayable with interest in 30 monthly instalments commencing from 01.08.2014 to 01.01.2017 @Rs.8,050/- pm. At the time of finance, the complainant had submitted the O.P.s 05 Nos of Signed Cheques, but without any amount written on it bearing No. 000881 to 000885 from his Axis Bank Account No. 913010016947539, photos and had signed a bunch of blank papers, printed papers with dotted lines unfilled etc. Purported to be agreement of loan, the copy of the agreement is never supplied to the Complainant. Though the Complainant was repaying the finance amount as agreed, the agents of O.P.s regularly demanding some exaggerated amount each time they approach for monthly instalments with threats that unless it was paid they would take away the vehicle, hence the Complainant was hardly able to ply the vehicle freely thereby causing substantial loss to his earning directly affecting his standard of living. The O.P.s even after collecting the EMIs did not issue receipts on some plea or the other. Hence all these activities of the O.P.s in dealing with the Complainant, as alleged by the complainant being unfair, arbitrary amounting to deficiency in service, has filed this Complaint to allow with compensation of Rs. 3,00000/- interalia other reliefs.
02. The complainant in his support has provided the account statement dtd.10.06.2016 pertaining to the loan repayment,15 nos of receipts issued by O.P.s acknowledging the repayment, letters of O.P.s and certain other documents, considered.
03. The O.P. entered their appearance on dt.16.12.2016 to contend that, the complainant is not a consumer as through the truck business he is earning huge profit, thus is doing commercial transaction of transport business. The relation between the Complainant and the O.P.s are of a creditor and debtor and debtors are not coming within the meaning of consumer within the purview of the C.P.Act. The O.P.s further raised a peculiar issue, that, though the complainant in his complainant has stated that, he is under matriculate and does not know English, but has drafted petition strongly without the aid of any authorized agent and in now where in the present dispute it is stated that the same is drafted typed and read over and explained by same one. So the Complaint is vexatious and frivolous. As per the agreement the Complainant must pay the Penal Interest. The money receipts would clearly show the irregularity of the Complainant in repayment. Further the O.P. had sent the sanction letter and agreement copy before availing the loan amount to the Complainant. Nine Cheques issued by the Complainant have been bounced and thus for full settlement of the loan the Complainant issued another cheque bearing No. 883, which is also bounced, and thus the O.P. has filed a complaint u/s 138 N.I.Act which is recorded as I.C.C.No.110/16 in the file of the S.D.J.M.,Jeypore. The Forum has no jurisdiction to entertain the complaint as there is an arbitration clause, and disputes arising of the agreement should have been referred to arbitrator. The Complainant is not bonafide, the claim of Rs.3,00,000/- is also not without any legal basis, hence prayed for dismissal of the Complaint.
04. The answering O.P.s though have referred to have submitted some documents in para 6 of their counter, but did not provide us any documents as such, nor even a scrap of paper in support of their contention.
05. Considering all the facts and submissions by the parties to the case, this forum has restricted its adjudication to the following issues:
1) Whether the complainant is a consumer as defined in the C.P.Act?
2) Is this forum ousted of the jurisdiction as claimed by the OP as per Sec 11(2) or as there is a provision of arbitration in the agreement ?
3) Is appointment of a authorized agent is a must in proceeding of a Consumer Forum ?
4) Whether the Complaint devoids of any merit or there is any deficiency on the part of the O.P.s and do the parties entitle to any relief and if yes to what extent?
06. Sec.2(1)(g) defines deficiency of service as “deficiency” means any fault, imperfection, shortcoming or inadequacy in the quality, nature and manner of performance which is required to be maintained by or under any law for the time being in force or has been undertaken to be performed by a person in pursuance of a contract or otherwise in relation to any service;
The learned counsel for the O.P.in his submission admits that, the relation of the complainant and O.P.s emerge out of an agreement, i.e. a loan agreement and also admits that, the clauses of the said agreement are enforceable by law, and as a contract is a legally binding agreement reached between two parties, the terms of which the courts have the authority and obligation to enforce, so between the parties there was a contract, the contract was of a financial assistance and of an hypothecation.
07. Here in the section the word ‘in pursuance of a contract leaves no ambiguity to the question that any service, the parties bound to perform under a contract, may be that contract private or public, implicit or explicit, but arising out of a contract, which the plea of the learned counsel for the OP that the jurisdiction of the consumer court in the matter of deficiency in service on the part of the Ops is not ousted in view of the existence of a private contract/agreement.
08. Sec. 2(d) (ii) defines a consumer means any person who hires of any services for a consideration…..
Sec.2 (O) of the act defines ‘service’ means service of any description which is made available to potential uses and includes, but not limited to the provisions of facilities in connection with banking, financing, insurance, transport, procuring……
09. Undoubtedly the OPs are NBFC Company availing of financing services to their customers and the present complainant availing that service for a valuable consideration i.e. interest on such advance; hence the Complainant is a consumer under the Act.
10. And it is not disputed that, the Complainant is the owner of the truck in question.
11. As the present dispute is all arises of an agreement we are to consider some important aspects of a valid agreement. In our country, except so far as specifically provided for and covered by any other legislation, the matter relating to all agreements constituting substratum of a valid contract are subjected to Indian Contract Act 1872.
12. In addition to four basic ingredients as laid down in Sec.10 of the I.C.A absence of lawfulness and enforceability are pertinent in the context of investigation of the questions under consideration.
13. Unlike in the fact, law of contract has in recent times is assuming a new and wide dimensions. The financers practicing concluding contracts in non standardized forms. Such contract contains a large number of terms and conditions which restrict and often excludes the liability of the banks/ financiers under the contract. In the ordinary way, the customer has no time to read them, and if read them, he would probably not understand them. If he did understand and object to any of them, he would generally be told that he could take or leave. An individual with acute need of the finance can hardly bargain, his only function is to accept the offer, whether he likes its terms or not.
14. The O.P. claims that, in the contract there is provision of penal interest, and thus the O.P.s have a right to enforce and collect the penal interest from the Complainant. Further in the agreement, charge of penal interest on the daily balance is illegal. RBI from time to time in his master circulars has cautioned banks to refrain from charging penal interest from creditors; rather it has stressed more on NPA management. Hence, where the terms of agreement show the interest charged is penal, the transaction hence unfair and that the agreement was totally against public policy. The decision of Hon’ble Supreme Court in S.Raj Gopalswami Naidu Vs The Bank of Karaikudi Ltd, reported in AIR 1971 SC 684 supports the complainant herein.
15. And considering the essence of Sec.23, reproducing all of them is apprehended of lengthening the conclusion. We hold that every agreement made for or about any matter or thing which is either forbidden by status or would defeat the provisions of any lay, or the court regards it as opposed to public policy, is unlawful and ipso fact void.
16. It is admitted that, the complainant was availed finance of Rs.1,82,000/- agreeing to pay with interest of Rs. 59,800/- in 30 installments starting from 01.08.2014 to 01.01.2017 @Rs.8,050/- pm and a loan agreement, the copy of which could not be supplied to us either of the parties, was executed between parties, on dt.30.06.14.
The O.P. counsel submits that, the complainant is not paying the installment regularly, though he has not submitted any documents to support his contention, the Complainant has produced one account statement which is supplied to him by O.P. on 10.06.2016 , which shows that, till 28.07.2015 towards twelve installments of repayment against the loan, the Complainant has paid Rs.1,26,650/- in 17 different dates above and in excess of actually payable sum of Rs. 96,600/- i.e. the total amount of 12 installments. And till 01.04.2016 the complainant has paid Rs.165,800/- against 18 installments. Hence the contentions of the O.P.s that, the Complainant was not regular in repayment is totally false and fabricated, devoid of any authentication.
17. The complainant submits that, though he was paying regularly the OP.s are demanding each time some excess amount to satisfy their oblique motive by harassing and frustrating him. He referred us to the two letters the OP.s dtd. 11.08.2015 and 17.08.2015 176070/- and 180632/- respectively. As we have stated in the preceeding para no. 16 that, till the date of the notice, the complainant had paid in excess of the actual repayable amount, the demand letters as above, are undoubtedly made deliberately to satisfy the illegal lust of the O.P.s to exploit the complainant.
18. Undoubtedly the consumer protection act is a beneficial act enacted for protection of consumer against the powerful business houses, financiers, merchants etc. The glaring example is the present case of the Complainant, where in the act is incorporated to provide the cheapest and quickest justice to the complainants without relegating them to the tardy processes of ordinary courts. Nowhere in the act suggested the Complainant to have a legal expert as authorized agent. Consumers may come to themselves, there are counsels appointed by the Government to provide them free service. Technicalities of the civil court as provided in C.P.C. or CRPC are not observed throughout the adjudication, but simple and summary procedure is followed, and order passed considering the principles of natural justice.
19. Hence, the contention of the OP.s that complainant did not pay the installments, is all false and deliberate and made to misguide this forum.
20. The Complainant argued that, the O.P. being an N.BF.C. should have been guided by the rulings and directives of the R.B.I., and R.B.I in its different circulars has strictly instructed the N.B.F.C.s including the present O.P. to adhere to a fair practice Code, while dealing with their customers, urging for loan advances. He has filed copies of such circulars one among them is of recent date of 2nd,july,2012, where in the O.P. should have adhered to a fair practice code of availing all such information and conditions to be stipulated in the agreement, special conditions prejudicial to the interest of the customer, should be intimated prior to sanctioning of the loan and let sufficient time to the get the customer well go through the content of it to consent to agree with the conditions, only after which agreement should have been executed. Signing of agreement without going through the conditions stipulated therein, is void & hit by sec.23 of the Contract Act. And in the present case the O.P. has deliberately deprived the complainant from going through the conditions of the agreement he signed so also he is not intimated of the rate of interest, consequence of delayed payment, but on repeated requests through letters and personal phones, the O.P.s never bothered to deliver copy of the agreement or statement of accounts hence all through the period the Complainant is kept in dark of the contents of the agreement and the account statement, subsiding the rulings and directives of the R.B.I., hence amount to deficiency in service on the part of the O.P. in the whole transaction.
21. The Contention of the O.P.s that, the Complainant is engaged in transport business, earning huge profits is mere hypothetical as was not corroborated by any single evidence or instances, being vague, discarded from consideration.
Further failure of the O.P.s to provide us information as and when they had the nine cheques of the Complainant and when it was bounced, if they had informed of such bounces to the complainant as required by law, and even could not explain us why such cheque bounce statement is not reflected in their account statement, which is supplied us by the Complainant, hence the story of cheque bounce is a cooked up story, without any substance or evidence.
22. Further, as the O.P.s has already initiated Complaint case against the Complainant u/s 138 of NIA pending res subjudice before the S.D.J.M., Jeypore, we are refrained from calculating the amount of repayable under the loan account.
23. From the whole transactions, it can be hold beyond doubt that, that the very intention of the OP.s is dealing with the complainant was malicious, motivated by unusual enrichment at the cost of livelihood of the complainant. The OP.s being a NBFC guided by RBI guidelines, issued from time to tie, and statutes like security enforcement Act and rules have been there under, the OP.s has violated all these statutes rules and RBI guidelines in dealing with the complainant, hence being arbitrary in their action, malafide and deficient in providing fair service to complainant, is bound to compensate the financial loss and mental and physical torture they have inflicted on the complainant. Hence the complaint allowed against all the OP.s.
ORDER
i. The O.P.s are hereby directed to pay the Complainant a sum of Rs.2,00,000/-(Rupees two lakh) as compensation and further a cost of Rs.10,000/-( Rupees ten thousand) for all such mental agony financial loss they have inflicted on the complainant through thorough unfair and arbitrary actions as discussed above.
ii. The OP.s shall be refrained from any action to repossess the vehicle in question, save through procedures prescribed by the laws in force.
iii. All the above directions shall be complied with in 30 days of this order, failing which, the total sum will bear 12% interest per annum till its realization. Pronounced on 04th day of January' 2017.
Sd/- Sd/- Sd/-
MEMBER MEMBER PRESIDENT, DCDRF,
NABARANGPUR.
