Sri Shyamal Gupta, Member

This Appeal filed u/s 15 of the Consumer Protection Act, 1986 is directed against the Order dated 11-05-2016 of Ld. District Forum, Kolkata-II (Central) in C.C. No. 534/2015.

In a nutshell, case of the Complainant is that availed of gold loans from the OP which was repayable in 36 months.  Admittedly, the Complainant could not make due payment in the months of September and October, 2015.  Without appreciating his predicament, the OP sent a message on 15-10-2015 stating that they would liquidate the entire gold kept with them to realize the outstanding payment.  Hence, the complaint.

OP contested the case by filing WV.  Asserting that the relationship between the parties is that of a Pawner and Pawnee, it is claimed by the OP that the present case is not maintainable in terms of the principles laid down u/s 173 to 176 of the Contract Act, 1872.  By virtue of the said Sections of the Contract Act, it is claimed, the OP was fully within its right to sell the pledged articles in order to realize the claimed amount.  Accordingly, it prayed for dismissal of the complaint.

Decision with reasons

We have heard the Ld. Advocate of the Appellant.  Be it mentioned here that on receipt of notice, one Advocate, namely, Mr. A. Bhattacharya appeared on behalf of the Respondent on 10-08-2016 and undertook to file vakalatnama.  However, subsequently neither he nor anybody else turned up on behalf of the Respondent.  Therefore, the case was heard ex parte.

Since the Appellant harped much on the maintainability aspect of the complaint in terms of the provisions laid down under Sec. 173 to 176 of the Indian Contract Act, let us first lay down the basic/essential elements of a valid contract:  They are, 1. Agreement. 2. Intention to create legal relationship. 3. Free and genuine consent. 4. Parties competent to contract. 5. Lawful consideration. 6. Lawful object. 7. Agreements not declared void or illegal. 8. Certainty of meaning. 9. Possibility of performance. 10. Necessary Legal Formalities. Be it mentioned here that, an illegal contract or agreement is not a contract at all, and Courts will not enforce them.

On going through the impugned order, it appears that the Appellant is running its business illegally.  The Ld. District Forum, on due scrutiny of the Certificate of Registration of the Appellant (copy of which has not been placed before us by the Appellant) noted that the RBI prohibited the Appellant from mobilizing public deposit with the rider that even if it accepts public deposit, it would be under obligation to obtain prior written consent from the RBI. 

The Ld. District Forum further noted that there was another clause in the said Certificate of Registration to the effect that if any NBFC accords loan by mortgaging gold, it would have to take licence from the Gold Controller.  Significantly, on going through the website of the Appellant, we find that the Appellant introduces itself as a subsidiary of IIFL Holdings Limited.  It is further stated therein that, India Infoline Finance Ltd. (IIFL Finance) is a systemically important non-deposit accepting non-banking finance company. The Company was incorporated in 2004 as India Infoline Investment Services Private Limited and converted into a Public Limited Company in 2007. However, on going through the entire record, we do not come across any of the requisite certificates.

In view of this the Ld. District justifiably questioned the right of Appellant to grant gold loan to general public like the Respondent.  Unfortunately, although the Appellant in its Memo of Appeal cried foul over allowing the case in favour of the Respondent, it has not offered any satisfactory explanation to the pertinent question raised by the Ld. District Forum. 

Thus, we have no hesitation holding that the Appellant is running its business in utter contravention of the Rule of law.  In view of this, it hardly requires any emphasis that the agreement executed in between the parties of this case was no contract at all in the eye of law.  Consequent thereof, all its actions under the said agreement was a nullity.

Thus, we find no infirmity with the impugned order.  Appeal, thus, fails.

Hence,

O R D E R E D

That the Appeal stands dismissed ex parte being bereft of any merit.  The impugned order is hereby affirmed.