BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

========

Complt.  Case No :  38 of 2009

Date of Institution:  12.01.2009

Date of Decision  :  14.09.2010

Prem Singh son of Sh.Ram Swaroop Sharma, R/o H.No.696/B-1, Rampur Colony, Pinjore, Tehsil Kalka,District Panchkula.

……Complainant

V E R S U S

1]     India Infoline Limited, SCO No.221, Sector 40-D, Chandigarh, through its Branch Manager

2]      Shri Dhruv Sharma, Asstt. Relationship Manager, India Infoline Limited, SCO No.221, Sector 40-D, Chandigarh.{Deleted vide order dated 6.5.2009}

.…..Opposite Parties

CORAM:          SH.LAKSHMAN SHARMA                         PRESIDENT

                    SH.ASHOK RAJ BHANDARI            MEMBER

                    MRS.MADHU MUTNEJA                        MEMBER

PRESENT:     Sh.Jatin Sabharwal, Adv. for the complainant.

Sh.Neeraj Sahni, Adv. for the OP No.1.

OP No.2 deleted.

PER MADHU MUTNEJA, MEMBER

                This complaint has been filed by Sh.Prem Singh, under Section 12 of the Consumer Protection Act. 

1]             The facts of the case are as under:-

                The complainant had been contacted by OP No.2 (who on the request of the complainant has already been deleted from the array of OP’s vide order dated 6.5.2009) for opening a Dmat Account with OP No.1 finding the offer profitable, the complainant had opened a Dmat account with OpNo.1 and invested a huge amount of money in the company on the basis of the commitment made by them.  An account statement submitted by the complainant and attached with the complaint shows the complete detail of transactions made on the his behalf by OPs. 

                After some time the complainant was surprised to see that he had suffered a great loss because of wrong investment made by the OPs on his behalf without his permission and consent.  The complainant felt that the OP was indulging in self-trading in his account due to which, he had to suffer great monetary loss.  Certain shares were sold at loss while other shares were purchased at higher rates and subsequently sold at losses without his consent

                The complainant sent several e-mails in complaint to the Head Office of the OP but no action was taken by them  to solve the issue.  Along with the details of account, the complainant has also submitted all e-mails exchange between the parties, with the complaint to substantiate his allegation.  When no action was taken by the OPs to redress his grievance and compensate him for the monetary loss suffered, the complainant was left with no other option but to file the instant complaint under the Consumer Protection Act.

                Alleging deficiency in service and unfair trade practice, the complainant has prayed that the OPs be directed to pay compensation of Rs.1.00 lac along with costs.

2]             After admission of the complaint, notice was sent to OPs.  

                On 6.5.2009, the ld.Counsel for the complainant gave a statement that he does not press the claim against OP No.2 as he is only the employee of OP-1, so, his name be deleted from the array of parties.  Accordingly, the name of OP No.2 was deleted from the list of OPs vide order dated 6.5.2009.

                In the reply filed by OP No.1, it is stated that the complainant had opened a demat account on 27.12.2007 with OP No.1 and was doing regular trading through his account.  This account was opened after entering into a Member Client Agreement, and also a Combined Risk Disclosure Agreement, for capital market/cash segment and future and options segment (BSC & NSC) formulated by the exchanges in co-ordinations with SEBI.  The agreement was signed and accepted by the complainant. 

                All trades executed on behalf o the complainant were regularly sent to his e-mail ID for confirmation.  The complainant was well aware of all trade and transactions as well as various amounts credited into his account from time to time.  He was also regularly intimated about the debit balance in his account, so that he could clear the debits and keep it well within and under the margin cover.  Even SMS intimation for all transactions executed were being regularly sent to him on his mobile number provided at the time of opening of the demat account.

                The OP has categorically denied that they have ever done any self-trading into the account of the complainant as alleged.  Further, the complainant has filed a complaint against them before the Bombay Stock Exchange, which was disposed off on 17.8.2009 by the Investors Grievances Redressal Committee.  A perusal of the orders of the Investors Grievance Redressal Committee, dated 17.8.2009 (Ann.D-5) reads as under:-

“The complainant is absent even today.  We have heard the TM and have gone through the records.  The TM has stated that the allegations of the complainant are of vague nature and, therefore, cannot be commented upon.  He has stated that the complainant’s trading account is having a credit balance of nearly Rs.535/- as on 12.06.2009.  Thereafter there had been no trading.

The TM states that account will be closed after giving intimation/explanation to the complainant and the balance will be remitted.

                        Complainant, if so advised, may go in for                    arbitration.

                        Matter disposed off.”       

                In view of the above orders of the Investors Grievance Redressal Committee, the Ops submit that the complainant is not justified, hence they have prayed for dismissal of the complaint.

3]             We have heard the ld.Counsel for the parties and have also perused the evidence and documents placed on record by the parties.

4]             The OP has placed on record the complete ledger details of all transactions of the complainant as annexure as per ledger maintained with them.  The complainant has also placed the details of all his account transactions with the OP’s. 

5]             It is a case where a complainant would be happy  where he had earned profit and he is aggrieved when he has suffered losses.  OP states that persons who suffer losses in the stock exchange have a tendency to make allegations against their brokers to extract benefit/money from them. Copious documents have been attached with the reply by the complainant and OP No.1 to prove their points.  The account statements of both are not similar and would require an expert to make them tally.  At the time of arguments also, the agent of the complainant kept on pointing out various transactions highlighting how the OP No.1 has defrauded the complainant.  It was contended by the OPs that analysis of all such transactions would not fall within the ambit of Consumer Protection Act.

6]             We are also of the view that all transactions made between the complainant and OP are specific, and their acceptance and denial by either party would require copious oral and documentary evidence over each transaction to find out the validity and verification of each, as per the Securities Contracts (Regulations) Act; as also the bye-laws framed by SEBI,  which are statutory in character as held by the Hon’ble Supreme Court of India in Bombay Stock Exchange Vs. Jaya I. Shah & Anr., AIR 2004 SC 55

7]             The jurisdiction of The Consumer Protection Act is very limited. It does not allow taking of evidence to ferret out contentious issue of facts and transactions.  The complainant has alleged that the OPs have made wrong investments with his money without his permission or consent due to which he has suffered great loss.  Certain shares have been purchased at escalated price while other have been sold at reduced price.  The OPs submit that all trades executed in the account of the complainant have been regularly sent to him by e-mails and the complainant is well aware of all the trades and transactions in his account.  Both parties have given their separate ledger details of transaction. 

                The question now is whether the Consumer Forum would be in a position to pick-out each transaction and its corresponding transactions in the account statements of both parties and tally them to find out whether either party is misstating or miscalculating or whether there has been a profit or loss, as also, who is responsible for this profit or loss.  In our opinion, it would not be possible to do so with surety and clarity.  Analysis and tally of both accounts would require evidence and counter-evidence from both sites.    

8]             In view of the above observations and discussion on various allegations and counter allegations made by the parties upon each other in the complaint and reply, we feel that we cannot adjudicate upon the matter under the summary procedure available under the Consumer Protection Act. It will require detailed and extensive evidence to prove each and every transaction as to whether it was in accordance with the statute, rules and bye-laws or not. 

9]             In view of the above, without expressing any opinion whatsoever on the merits of the complaint or whether the claim of the complainant is justified, we deem it appropriate to dispose of the complaint as it is beyond the scope of the Consumer Protection Act. It requires detailed oral as well as documentary evidence and extensive calculations and therefore, cannot be decided summarily under the Consumer Protection Act.  Accordingly, the present complaint is disposed of with a direction to the complainant to approach the appropriate Civil Court for redressal of his grievance(s).

                Certified copies of the order be supplied to the parties free of any charge. The file be consigned to the record room after compliance.    

Announced

14^th Sept., 2010                                                            Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

                                                                   Sd/-

                                       (ASHOK RAJ BHANDARI)

MEMBER

                                                                                                Sd/-

                                                    (MADHU MUTNEJA)

MEMBER

‘Om’