BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AMRITSAR.

Consumer Complaint No. 456 of 2014

Date of Institution: 22-8-2014

Date of Decision: 21-07-2015

Rashmi Chadha wife of Sh.Kapil Chadha, resident of House No. 470, Gali Nainsukh Wali, Ward No.5, Amritsar.

Complainant

Versus

1. HDB Financial Services Limited, 2^nd Floor, Central Mall Ebony Building,Mall Road, Amritsar through its Officer Incharge.
2. The Director, HDB Financial Services Limited, Ground Floor, Madhusudan Estate, Pandurang Budhkar Marg, Lower Parel, Mumbai-400013.

Opposite Parties

Complaint under section 12/13 of the Consumer Protection Act.

Present: For the Complainant: Sh. Amit Bhatia, Advocate

              For the Opposite Parties: Anil Sharma, Advocate

Quorum:

Sh.Bhupinder Singh, President

Ms.Kulwant Kaur Bajwa, Member

Mr.Anoop Sharma, Member

Order dictated by:

Sh.Bhupinder Singh, President.

1. Present complaint has been filed by Smt.Rashmi Chadha under the provisions of the Consumer Protection Act alleging therein that she applied for the loan amount of Rs.1,35,000/- against her gold ornaments and she was granted the said loan vide loan account No. 416946 by the branch of Opposite Party bearing code No. 114. Complainant alleges that said loan amount was granted to the complainant on 2.5.2013 and it was to be repaid in Equal Monthly Installments to the tune of Rs.4,881/- per mensum in a period of 36 months. The complainant continued making the aforesaid installments of the said loan amount and she never had the intention to liquidate the debt outstanding against her.  The payments of installments used to be made by the complainant either in cash or through cheques. Said loan was availed by the complainant by pawning her jewellery with the Opposite Party when she was in a stage of grave financial stringency. The gold ornaments pawned by her were her Istri Dhan and she could not dream of parting with the same by way of sale and on account of this fact instead of selling the said gold ornaments  in the market, she preferred to raise the loan from Opposite Party No.1 hoping that on the payment of the entire loan amount, she would get back the said gold ornaments. The financial hardships faced by the complainant were only for a transitory period and when she succeeded in tiding over the same, the complainant approached the Opposite Party many times with the request to get back the said loan amount in entirety alongwith interest and other charges, but the Opposite Party remained putting off the complainant on one pretext or the other. The complainant never received any loan recall notice at her residential address which was furnished to the Opposite Party at the time of making the request for the advancement of the loan amount.  It was mandatory on the part of the Opposite Party to serve the loan recall notice on the complainant at her correct residential address before the misappropriation of her gold ornaments  which were entrusted to it on good faith with the stipulation that the Opposite Party would return the same to the complainant after repayment of the loan. Not even a single loan recall notice at any time was received by the complainant at her residential address or even at the business place of the husband of the complainant. Not only this, the record of the Blue Dart Courier Services through which the Opposite Party alleged to have sent recall notice to the complainant was shuffled and even said record shows that no notice was delivered to the complainant, it being out of delivery area. It is quite strange that inspite of having the correct residential address of the complainant no efforts were made to get the service of any letter or notice effected on the complainant regarding the alleged over due loan amount. It seems that the Opposite Party had the evil and dishonest intentions to misappropriate the Istri Dhan of the complainant in the shape of gold ornaments  being of more value than that of the due loan amount. The complainant had received the said gold ornaments  from her parents and in-laws at the time of her marriage and the same were loved by her from the core of her heart. The Opposite Party No.1 defaulted in intimating the complainant regarding the alleged outstanding amount and seems to have usurped her said gold ornaments by making fictitious alleged entry of the sale of the same as has come to the knowledge of the complainant after the flat refusal by the Opposite Party for the receipt of the entire loan amount from her in lump sum alongwith interest and other charges. The Opposite Party has rendered itself primary liable for misappropriation of the gold ornaments  of the complainant which were entrusted to it in good faith and apart from that, the Opposite Party is liable to pay damage. Alleging the same to be deficiency in service, complaint was filed seeking directions to the opposite party to pay Rs.2 lacs as compensation to the complainant for putting her in acute mental stress and agony. Litigation expenses were also demanded.
2. On notice, Opposite Parties appeared and filed written version in which it was submitted that the complainant has taken the loan for commercial purpose for her establishment namely M/s.Juventus Spanish Remedies, VPO Mana Wala Khurd, Amritsar in order to generate profits while running commercial establishments. The complainant is habitual defaulter and she never deposited loan EMIs within stipulated period as agreed at the time of advancement of loan. The complainant submitted gold loan application form with the Opposite Parties wherein she has mentioned two correspondence addresses, one of her residence and other of her office namely M/s.Juventus Spanish Remedies, VPO Mana Wala Khurd, Amritsar. The EMIs of the loan amount are to be deposited on every 4^th  day of calendar month. It is further submitted that the complainant from the day first failed to deposit her loan EMIs in time. It is denied that complainant continued making the aforesaid installments of said loan amount and she ever had the intention to liquidate the debt outstanding against her. The Opposite Parties have adopted due procedure of law and have not committed any wrongful act. Proper and effective opportunities were provided to the complainant to make her loan account good, but she failed to do so. In order to recover the loan amount, the gold ornaments  of the complainant was auctioned as per the company norms and guidelines and after adjusting the loan amount, refund of Rs.46,412/- was offered to the complainant, but she refused to receive the same and husband of the complainant put his respective signatures on the letter as token of its correctness.  While denying and controverting other allegations, dismissal of complaint was prayed.
3. Complainant tendered into evidence her affidavit Ex.C1 alongwith documents Ex.C2 to Ex.C6and closed the evidence on behalf of the complainant.
4. Opposite Parties tendered into evidence affidavit of Sh.Gurdarshan Singh, Ex.OP1,2/1 alongwith documents Ex.OP1,2/2 to Ex.OP1,2/14 and closed the evidence on behalf of the Opposite Parties.
5. We have carefully gone through the pleadings of the parties; arguments advanced by the ld.counsel for the parties and have appreciated the evidence produced on record by both the parties with the valuable assistance of the ld.counsel for both the parties.
6. From the record i.e. pleadings of the parties and the evidence produced on record by the parties, it is clear that the complainant obtained loan of Rs.1,35,000/- from Opposite Party No.1 vide loan account  No. 416946 on 2.5.2013 which was to be repaid in Equal Monthly Installments of Rs.4,881/- within a period of 36 months. The complainant submitted that she has been making the  payment of the aforesaid installments continuously. She  had no intention to liquidate the debt outstanding against her.  Said loan was availed by the complainant by pawning her jewellery which were her Istri Dhan with the Opposite Party. The complainant was ready to pay the  entire  loan amount alongwith interest and other charges, but the Opposite Party remained putting off the complainant on one pretext or the other. The Opposite Parties never served any notice to the complainant for recalling the loan amount at her current residential address before selling her gold ornaments  which were entrusted to the Opposite Parties by the complainant in good faith. The complainant also did not receive any loan recall notice at her residential address or even at business place. Even record of the Blue Dart Courier Services through which the Opposite Party alleged to have sent recall notice to the complainant,  shows no notice was delivered to the complainant, it being out of delivery area and the Opposite Parties did not issue any recall notice to the complainant inspite of the fact that they were having correct residential address of the complainant. Complainant alleges that in order to usurp  her said gold ornaments, the Opposite Parties made fictitious alleged entry of the sale of the gold ornaments  of the complainant in order to recover the entire loan amount from her in lump sum alongwith interest and other charges. Ld.counsel for the   complainant  submitted that all this amounts to deficiency of service, rather unfair trade practice  on the part of the opposite parties qua the complainant.
7. Whereas the case of the Opposite Parties is that the complainant has taken the loan for commercial purpose for her establishment namely M/s.Juventus Spanish Remedies, VPO Mana Wala Khurd, Amritsar in order to generate profits while running commercial establishments, so the complainant is not the consumer under the Act. The complainant is habitual defaulter and she never deposited loan EMIs within stipulated period as per loan agreement. At the time of submission of gold loan application form Ex.OP1,2/1A with the Opposite Parties, the complainant has given two correspondence addresses, one of her residence and other of her office namely M/s.Juventus Spanish Remedies, VPO Mana Wala Khurd, Amritsar. The loan availed by the complainant was repayable in 36 EMIs of Rs.4,881/-. Both the parties signed the declaration-cum-terms and conditions of the gold loan Ex.OP1,2/2. The EMI of the loan amount was  to be deposited on every 4^th  day of calendar month, but the complainant  failed to deposit her loan EMIs in time as is evident from the statement of account of the complainant Ex.OP1,2/7. Opposite Parties denied that the complainant had ever requested the Opposite Parties for payment of the entire loan amount alongwith interest and the Opposite Parties put off the complainant on one pretext to another. The complainant became defaulter and failed to pay the EMIs. As such loan recall notices were issued to the complainant and the officials of the Opposite Parties personally met the complainant and handed over the copy of loan recall notice dated 8.1.2014 Ex.Op1,2/8, loan recall notice dated 16.1.2014 Ex.OP1,2/9 and loan recall notice  dated 24.1.2014 Ex.Op1,2/10, but the complainant showed her inability to repay the loan amount and was not willfully depositing the defaulted amount with the Opposite Parties. Opposite Parties then sent auction notice to the complainant dated 12.3.2014 Ex.OP1,2/12 stating the date of auction of the gold ornaments   pledged by the complainant with the Opposite Parties as security for the loan amount, as 18.3.2014. But even then, the complainant did not pay the outstanding amount to the Opposite Parties. As such, Opposite Parties put the gold ornaments  of the complainant on auction in order to recover the loan amount, as per company norms and guidelines and after adjusting the loan amount, the refund of Rs.46,412/- was offered to the complainant, but she refused to receive the same. However, husband of the complainant put his signatures on this letter dated 2.5.2014 Ex.OP1,2/13, on 3.5.2014.  Ld.counsel for the Opposite Parties submitted that there is no deficiency of service on the part of the Opposite Parties.
8. From the entire above discussion, we have come to the conclusion that  complainant in order to get the loan amount of Rs.1,35,000/- submitted application form Ex.C5/ Ex.OP1,2/1A with the Opposite Parties and she pledged her gold ornaments  as per list Ex.OP1,2/11 as security for the loan. Said loan was sanctioned to the complainant on 2.5.2013 by the Opposite Parties which was repayable in 36 EMIs of Rs.4,881/-. Both the parties also signed the declaration-cum-terms and conditions of the gold loan dated 30.4.2013 Ex.OP1,2/2. EMI is to be paid on 4^th day of every calendar month. The complainant gave cheques to the Opposite Parties  and almost all the cheques except one, given by the complainant, were dishonoured by the banker of the complainant. As such, the complainant except one cheque of installment of 4.11.2013 which was paid by the complainant in time on 4.11.2013, all other installments were paid on 10.6.2013, 25.7.2013, 29.8.2013, 17.9.2013, 7.10.2013, 7.12.3013, 6.1.2014 and 7.2.2014. Thereafter, the complainant continuously did not pay 3 installments. As such, the complainant became defaulter and the Opposite Parties recalled the loan amount as per the terms and conditions of the agreement Ex.OP1,2/2. As per the version of the Opposite Parties, they issued loan recall notice  dated 8.1.2014 Ex.OP1,2/8 at the address of business office of the complainant. Thereafter, the Opposite Parties issued another loan recall notice  dated 16.1.2014 Ex.OP1,2/9 and finally sent loan recall notice  dated 24.1.2013 Ex.OP1,2/10, all on the business office address of the complainant and thereafter, Opposite Parties put the gold ornaments  of the complainant on auction and auction notice was given to the complainant on 12.3.2014 Ex.OP1,2/12 that too on the office address of the complainant and gold ornaments  were sold on the basis of quotations of  M/s.Kishore Jewellers & Sons, 125, Guru Bazar, Amritsar dated 18.3.2014 (Ex.OP1,2/11) and M/s.Krishna Jewellers & Sons, Guru Bazar, Amritsar dated 18.3.2014 (Ex.OP1,2/15) for  a sum of Rs.1,81,965/- and the Opposite Parties after adjusting the loan amount, sent letter to the complainant dated 2.5.2014 (Ex.OP1,2/13) stating to the complainant that after adjusting the loan amount, an amount of Rs.46,412/- is refundable to the complainant and the same may be collected from the Branch Office of Opposite Parties before  7 days.
9. No doubt, in case of default of payment of installments by loanee, the loaner/ financial institution is entitled to sell the pledged/ pawned articles of the loanee, but the loaner/ financial institution is liable to follow the procedure. In the present case, no doubt, the complainant became defaulter and did not pay the installments, as such, the Opposite Parties were entitled to put the gold on auction and to sell the  gold ornaments  pledged/ pawned by the complainant as security of loan/ payment, but by  following proper procedure. In this case, it is clear that the complainant became defaulter and failed to pay 3 EMIs of the loan amount. Opposite Parties have stated that they sent 3 loan recall notices i.e.  loan recall notice  dated 8.1.2014 Ex.OP1,2/8, second  loan recall notice  dated 16.1.2014 Ex.OP1,2/9 and finally sent loan recall notice  dated 24.1.2013 Ex.OP1,2/10 to the complainant. Opposite Parties have stated that they sent these letters to the complainant through official of the Opposite Parties, who handed over these notices to the complainant by hand, whereas the complainant has totally denied that any such notice was received by the complainant from the Opposite Parties. Opposite Parties’ official who allegedly handed over the aforesaid notices to the complainant by hand, has not taken the signatures of the complainant, nor the Opposite Parties have examined or filed the affidavit of any such official of the Opposite Parties who personally delivered and handed over these notices to the complainant. It was the duty of the Opposite Parties to prove that these notices were duly delivered to the complainant. Moreover, why the Opposite Parties were so hasty in issuing these 3 notices within a short span  of 16 days i.e. from 8.1.2014 to 24.1.2014. Apart from this, it is the duty of the Opposite Parties to ensure that such notices have been served upon the loanee/ complainant. Further more, the Opposite Parties have two addresses of the complainant as per loan application filed by the complainant Ex.OP1,1/1A produced by the Opposite Parties itself i.e. first address of her residence i.e. H.No.470, Gali Nainsukh Wali, Ward No.5, Amritsar with Pin code and second address is the business office address of her husband and not of the complainant and the Opposite Parties have issued all these three notices on the business office address of the husband of the complainant which also proves that these notices were not genuinely issued nor genuinely delivered to the complainant. If the complainant has not approached the Opposite Parties after issuing of first loan recall notice  why the Opposite Parties did not sent the 2^nd loan recall notice  on the residential address of the complainant. Similarly, why the 3^rd and final loan recall notice  was also issued by the Opposite Parties on the business office address of the husband of the complainant. Not only this, auction notice dated 12.3.3014 (Ex.OP1,2/12) was also issued on the business office address of the husband of the complainant and that too as alleged by the Opposite Parties, was handed over to the complainant by hand. But again, no signatures of the complainant were obtained on the office copy of this auction notice nor the Opposite Parties have examined or filed any affidavit of that official who personally handed over this auction notice to the complainant by hand. So, we are of the opinion that the Opposite Parties have failed to prove on record the proper service of these notices to the complainant. Apart from this, the Opposite Parties have not produced any record of auction of the gold ornaments  of the complainant. They have only produced two quotations, one quotation of M/s.Kishore Jewellers & Sons, 125, Guru Bazar, Amritsar dated 18.3.2014 (Ex.OP1,2/11) and second quotation  from M/s.Krishna Jewellers & Sons, Guru Bazar, Amritsar dated 18.3.2014 (Ex.OP1,2/15). These two are only quotations, but the Opposite Parties have not stated as for  how much amount, the gold ornaments  of the complainant were sold and to which party, nor the Opposite Parties could produce the final auction bid of the bidder and for how much amount and who did the auction? Whether it was open public auction or it was done in the office room not open to the public. Further as per the agreement of loan, the complainant was liable to pay the loan amount in 36 EMIs then what was the compulsion  for the Opposite Parties to sell the gold ornaments  of the complainant so hasty and without following proper procedure  as is expected from a prudent/ responsible person such like the Opposite Parties. Consequently, we hold that the Opposite Parties have sold the gold ornaments  of the complainant without following proper procedure and without giving proper opportunity to the complainant. So, there is deficiency of service on the part of the Opposite Parties.
10. As the Opposite Parties have already sold the gold ornaments of the complainant, so the gold ornaments  could not be returned to the complainant. However, the complainant suffered mental agony as gold ornaments  were the Istri Dhan of the complainant, so the complainant is entitled to compensation.
11. Resultantly, we partly allow this complaint with costs and the Opposite Parties are directed to pay compensation to the tune of Rs.50,000/- to the complainant, apart from the amount payable to the complainant after sale of the gold ornaments  i.e. Rs. 46,412/-. The Opposite Parties are also directed to pay the costs of the litigation to the complainant to the tune of Rs.2,000/-.  Copies of the order be furnished to the parties free of cost. File is ordered to be consigned to the record room. Case could not be disposed of within the stipulated period due to heavy pendency of the cases in this Forum.

Dated: 21-07-2015.                                                   (Bhupinder Singh)                                                                                               President

hrg                                                (Anoop Sharma)     (Kulwant Kaur Bajwa)   

              Member                         Member