BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM

VAZHUTHACAUD, THIRUVANANTHAPURAM.

PRESENT

SRI. G. SIVAPRASAD : PRESIDENT

SMT. BEENAKUMARI. A : MEMBER

SMT. S.K.SREELA : MEMBER

C.C. No. 248/2006 Filed on 15.09.2006

Dated : 30.11.2010

Complainant:

Sajith Sekhar. R, T.C 40/1256, Rejitha, Pettah P.O, Thiruvananthapuram-24.

(By adv. Santhivila M.P. Sasidharan Nair)

Opposite parties:

1. The General Manager, ICICI Bank, Landmark, Race Course Circle, Vadodara-390 007.

    

2. The Branch Manager, ICICI Bank Ltd., RAPG Division, 2^nd Floor, Kamala Towers, Ganapathy Kovil Street, Vazhuthacaud, Thiruvananthapuram-14.

(By adv. Koliacode K. Rajeev)

This O.P having been taken as heard on 30.09.2010, the Forum on 30.11.2010 delivered the following:

ORDER

SRI. G. SIVAPRASAD: PRESIDENT

The facts leading to the filing of the complaint are that complainant purchased a Mini Tipper Lorry bearing Reg. No. KL-01 AL 1367 under hire purchase agreement with the opposite parties, that as per the said agreement complainant remitted Rs. 51,431/-, out of which Rs. 34,320/- adjusted in the principal amount and Rs. 17,111/- towards interest, that on 08.06.2006 opposite party repossessed the said vehicle from the complainant as complainant had committed default in the payment of EMIs, that opposite parties insisted him to close the loan, that after the vehicle purchased, he had incurred a cost of Rs. 1,00,000/- towards extra fittings in the vehicle, that after repossession of the vehicle by the opposite parties he could not run the vehicle and that the vehicle was purchased for his livelihood. Repossession of the vehicle by opposite parties is illegal which amounts to deficiency in service. Hence this complaint to direct opposite parties to return the repossessed vehicle to the complainant or to refund the amount paid by the complainant and pay compensation of Rs. 1,00,000/-.

Opposite parties filed version contending interalia that complainant approached the opposite parties for the purchase of the commercial vehicle and opposite parties financed him an amount of Rs. 7,00,000/- as per hypothecation agreement No. LVTVM 00005130028, that opposite party has every right to repossess the vehicle in case of instalment dues, that total amount financed has to be repaid by 54 EMIs at the rate of Rs. 15,477/- per month, the instalment period is from 22.12.2005 to 22.05.2010, that the total default with over dues as on the date of repossession of the vehicle was Rs. 44,038/-. Opposite party asked the complainant to be prompt in payments, but he did not pay any heed to it. As per clause (iii) of the hypothecation agreement, “In the event of any breach or default by the borrower in the performance of its obligations hereunder or any of the terms, covenants, obligations and conditions stipulated in the loan terms and or the other transaction documents or in the event of the charge on the assets having become enforceable for any reason whatsoever, the bank or their nominees or authorized persons shall, in case such breach or default if not remedied by the borrower to the satisfaction of the bank without any notice and without assigning any reason and at the risk and expense of the borrower and if necessary as attorney for and in the name of the borrower, be entitled exercise such rights and remedies including(i) to enter into and upon the premises of the borrower and/or any other person who then has possession of the assets, (ii) to seize, recover, collect, withdraw, receive the assets and/or any income, profits and benefits there of without interruption or hindrance by the borrower and/or persons (iii) to remove and/or sell by public auction or by private contract, dispatch or consign for realization or otherwise dispose of or deal with all or any part of the assets and enforce, realize, settle, compromise and deal with any rights or claims relating thereto without being bound to exercise any of these powers or be liable for any losses in the exercise or non-exercise thereof, (iv) to be freed and discharged and well and sufficiently saved and kept harmless and indemnified of, from and against all former and other estates, titles, claims, demands, charges and encumbrances whatsoever or to direct the borrower and/or other concerned persons to sell, assign or otherwise liquidate, any or all of the assets”. It is submitted by the opposite party that opposite party had given various letters and intimations to the complainant regularise the dues, but complainant paid no heed at all, that then the opposite party having no other way, but to take the possession of the vehicle on 04.06.2006, that on 26.09.2006 opposite party issued a letter stating that it had disposed of the said asset for an amount of Rs. 2,90,000/- after due communication regarding the matter to the complainant. There is no bonafides or cause of action to the complaint. Hence opposite parties prayed for dismissal of the complaint.

The points that arise for consideration are:-

1. Whether the complainant had committed default in payment of monthly instalments?

2. Whether the repossession of the financed property from the complainant is lawful?

3. Whether there is any deficiency in service on the part of opposite parties?

4. Whether the complainant is entitled to get back the repossessed vehicle or in the alternative whether the complainant is entitled to get back the remitted amount from opposite parties?

5. Whether the complainant is entitled to compensation and costs?

In support of the complaint, complainant has filed affidavit and has marked Ext. P1 to P3. Complainant has been cross examined by opposite parties and Exts. D1 & D2 were marked. Opposite party has not filed affidavit.

Points (i) to (v):- Admittedly, complainant availed financial assistance from the opposite parties for the purchase of a vehicle bearing No. KL-01 AL 1367. The complainant has not mentioned the amount availed from the opposite parties, what has been mentioned is that he has remitted Rs. 51,431/- to opposite parties in connection with the vehicle loan. It is not clear from the complaint when did complainant take loan from the opposite parties, what is the mode of payment, the amount of EMIs, the duration of the loan etc. It has been stated in the complaint that after the purchase of the vehicle, he had incurred a cost of Rs. 1,00,000/- towards extra fittings. Complainant has been cross examined by the opposite party. Ext. P1 is the copy of reply notice to the letter dated 05.06.2006. Ext. P2 is the acknowledgement card. Ext. P3 is the letter dated 05.06.2006 issued by ICICI Bank along with statement of account. As per Ext. P3 letter it is seen informed the complainant that the aforesaid asset is taken into their custody because of non-payment of dues despite several reminders under the aforesaid agreement. Upon possession of the asset, the aforesaid loan agreement entered into by the complainant with opposite parties stands terminated as on 04.06.2006. On termination, as per records, complainant is liable to pay Rs. 7,27,401/- towards full and final settlement of the loan amount. Complainant was requested to remit the said amount along with overdue charges at 24% per annum and other charges till the date of payment within 7 days from the date of the said letter and to take delivery of the asset. It is further stated in Ext. P3 letter that if opposite parties failed to hear from the complainant within the aforesaid period, they would perceive that complainant is no longer interested in settling the account and hence necessary steps will be taken to dispose the asset to the best quote received by them and sale proceeds received will be credited to his account. Complainant was also requested to provide them original R.C Book, Insurance policy, tax payment certificate and all other statutory documents required to sell or deal with the said vehicle to recover their dues failing which they will be constrained to apply for the requisite duplicate documents. Complainant has been cross examined by opposite parties. When asked നിങ്ങള്‍ ഈ കാലയളവില്‍ കൊടുത്തിട്ടുള്ള എത്ര cheque-കള്‍ dishonour ആയി? കൃത്യമായി തവണകള്‍ അടച്ചിട്ടില്ല. മുടക്കം വന്നിട്ടുണ്ട്. അത് ഞാന്‍ clear ചെയ്തിട്ടുമുണ്ട്. നിങ്ങള്‍ പറയുന്നതിന് എന്തെങ്കിലും രേഖകള്‍ ഉണ്ടോ? എല്ലാ രേഖകളും മാനേജരുടെ കൈയിലുണ്ട്. വണ്ടിയില്‍ സൂക്ഷിച്ചിട്ടുണ്ട്. ആ വിവരം മാനേജര്‍ക്ക് അറിയാം. In his cross examination complainant has admitted that he has signed the hire purchase agreement and the conditions stated therein are applicable to him. When asked “ഒരു ലക്ഷം രൂപ ചെലവായി എന്ന് കാണിക്കാന്‍ രേഖ ഹാജരാക്കിയിട്ടുണ്ടോ? എല്ലാ രേഖകളും വണ്ടിയില്‍ സൂക്ഷിച്ചിരുന്നു. രേഖകള്‍ മുഴുവന്‍ വണ്ടിയിലിരിക്കുകയാണെന്ന് അന്യായത്തില്‍ പറഞ്ഞിട്ടില്ല. വണ്ടി പിടിക്കുന്ന സമയത്ത് ഒരു കുടിശ്ശിഖയും ഇല്ലായിരുന്നു. അന്യായത്തില്‍ 2 മാസത്തെ കുടിശ്ശിഖ ഉണ്ടായിരുന്നു എന്നു പറയുന്നത് ശരിയാണ്. പിടിക്കുന്ന സമയം കുടിശ്ശിഖ അടച്ചിരുന്നു എന്ന് കാണിക്കാന്‍ രേഖകള്‍ ഹാജരാക്കിയിട്ടുണ്ടോ? Statement ഹാജരാക്കിയിട്ടുണ്ട്. Ext. P3 ആയതിന്‍റെ തെളിവാണ്. Complainant has admitted the receipt of Ext. D1 letter dated 05.06.2006. It is pertinent to note that the said letter is seen sent after the possession of the asset from the custody of the complainant. Ext. D2 is the letter dated 26.09.2006 issued by opposite party to complainant stating that the repossessed vehicle disposed for Rs. 2,90,000/-, the sale proceeds have been credited to complainant's account and complainant is now liable to make the payment of Rs. 4,37,401/-, an amount and due and payable after adjusting the sale proceeds as per books of accounts. It is to be noted that opposite party has never furnished the hypothecation agreement nor furnished notice intimating the complainant prior to the repossession of the vehicle. On perusal of the statement of account furnished by opposite parties vide Ext. P3 first instalment was due on 22.12.2005 and the same was remitted on 21.01.2006, 2^nd instalment was due on 22.01.2006 and the same was seen remitted on 23.01.2006, 3^rd instalment was due on 22.02.2006 which was seen remitted on 23.02.2006. Thereafter EMI amount is seen remitted partly from which it appears that complainant has committed default in payment of instalment on due dates. As regards the repossession of the vehicle we need to highlight the guidelines to be strictly followed by the finance company before it exercises its power to repossess the vehicle which have been reiterated time and again by the various courts. If the amount is not paid by the borrower the finance company can exercise its power in the finance agreement to recall the loan. If it exercises its power a notice should be given to the borrower intimating that the loan has been recalled, the borrower should be called upon to pay the amount within 7 days of the receipt of the notice. This notice should be sent by registered post at the address given by the borrower. If the amount is not paid within the stipulated period as per the notice the finance company would be authorized to repossess the vehicle, but this power of repossession would not entitle the finance company to take the vehicle while plying on the road. In case the borrower refused to sign papers when the vehicle is repossessed, on repossession of the vehicle immediate information should be provided by finance company to local police intimating the time and place when the vehicle was repossessed. In the case in hand, nowhere in the complaint it is seen mentioned that the vehicle was repossessed while plying on the road. It is the case of the complainant that he has not received any notice prior to the date of repossession of the vehicle. Though opposite parties averred in their version that various letters and intimations were given to the complainant to regularise the dues, there is no material to prove that aspect. No materials furnished by the opposite parties to show that they have followed the above guidelines before exercising its power to repossess the vehicle concerned. Complainant never produced any other documents showing the date of payment of EMIs nor furnished any material to show the cost of extra fittings in the vehicle. In view of the above we are of the opinion that complainant had committed default in payment of EMIs on due dates. Further opposite parties not furnished any documents to show that the vehicle concerned was sold for Rs. 2,90,000/-. It is crystal clear from the above that opposite party has not followed the guidelines issued by various courts before it exercises its power to repossess the vehicle concerned. To the extent of which, we find there is deficiency in service on the part of the opposite parties. The onus is on the part of the complainant to establish the case. Complainant failed to prove that he has remitted the amount on due dates. Since the vehicle was repossessed without observing the guidelines, we find there is deficiency in service on the part of opposite party for which complainant is entitled to get a compensation of Rs. 10,000/-.

In the result, complaint is allowed. Opposite party shall pay a sum of Rs. 10,000/- towards compensation to the complainant within 2 months from the date of receipt of this order and both parties shall bear and suffer their costs.

A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.

Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Forum, this the 30^th day of November 2010.

G. SIVAPRASAD : PRESIDENT

BEENAKUMARI. A : MEMBER

S.K. SREELA : MEMBER

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C.C. No. 248/2006

APPENDIX

I COMPLAINANT'S WITNESS :

PW1 - Sajith Sekhar

II COMPLAINANT'S DOCUMENTS :

P1 - Copy of reply notice to the letter dated 05.06.2006

P2 - Acknowledgement card.

P3 - Copy of the letter dated 05.06.2006 issued by ICICI Bank along with statement of account.

III OPPOSITE PARTY'S WITNESS :

NIL

IV OPPOSITE PARTY'S DOCUMENTS :

D1 - Copy of letter dated 05.06.2006

D2 - Copy of letter dated 26.09.2006

PRESIDENT

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