This case is coming for final hearing on 19.01.2015 in the presence of C.R.Chandra, Sri B.Damodhar, Advocates for Complainant and of Sri P.Ravikiran for Opposite Party and having stood over till this date, the Forum delivered the following:

: O R D E R :

(As per Smt. K.V.R.Maheswari, Honourable President(FAC) on

behalf of the Bench)

1.       The case of the Complainant is that he joined as a subscriber with the opposite party who is a chit fund organization at Visakhapatnam in chit reference FMVLO 4J-8 commenced from 26.09.2011 for a chit value of Rs.5,00,000/- at a monthly subscription of Rs.12,500/- for a period of 40 months.  The complainant states that he is regular in payment of monthly subscription after deductions of dividends and he paid Rs.1,62,500/- regularly up to September, 2013 and subsequently, he is the successful bidder in the auction conducted on 25.08.2012, but he opposite party did not pay any amount for the auction amount.  As per the norms of the opposite party, the complainant produced four sureties as required by the opposite party, but the opposite party did not pay the price amount of Rs.2,92,800/- to the complainant.  The complainant made several requests and demands but the opposite party avoid the payment but obtained signatures of the complainant on the papers required for the disbursement of chit amount which is a usual procedure on a completion of bid.  Ultimately, the complainant issued a legal notice to the opposite party on 09.07.2013 and the said notice was received by the opposite party and gave a reply on 24.08.2013 with all false allegations and failed to pay the due amount to the complaint, which clearly shows the deficiency of service on the part of the opposite party.  The opposite party intentionally avoid the payment of auction amount and caused lot of mental agony and stress to the complainant.  Hence, the complainant is entitled for interest and compensation also.  Hence, this complaint to direct the opposite party;

a) to pay bid amount of Rs.3,92,800/- failing which to pay amount of Rs.1,62,500/-which was paid by the complainant together with  interest at 24% p.a. from September, 2012 till the date of payment.

b) to pay Rs.1,00,000/- towards compensation besides costs of Rs.2,000/-

3.       On the other hand, the opposite party filed its counter and admitted about joining in chit bearing Series FMVL04J.08 IB by the complainant and also admitted about the chit value, installments and joining date of the complainant in chit on 24.07.2012 i.e., 10 months after commencement of the chit and the complainant joined in the vacant chit, but denied all the allegations mentioned in the complaint and pleaded that the complainant signed the chit agreement and he agreed the terms and conditions of the chit agreement.  The complainant paid monthly subscription up to September, 2012 but not up to September, 2013 as mentioned by the complainant in the complaint and account copy also shows that clearly.  The opposite party further stated that the complainant is defaulter for payment of chit amount from August 2012 onwards and the complainant was successful bidder, but he failed to produce sufficient sureties’ insptie of repeated requests made by the opposite party personal, over phone and letters also. The opposite party also stated that the complainant totally paid an amount of Rs.1,18,653/- as subscription and Rs.31,352/- was given by the opposite party as dividends and the complainant is announced as successful bidder and prized the chit amount of Rs.1,32,000/- and his bid payable amount is Rs.3,68,000/- and his future liability is Rs.3,50,000/- but the complainant not submitted the sufficient sureties as required by the company relating to chit amount of Rs.5,00,000/- then, the opposite party issued a letter on 09.10.2012 to the complainant with a request to submit sureties, but inspite of receipt of that letter by the complainant, he failed to produce sufficient sureties to the opposite party, then, again on 18.10.2012 the opposite party issued a letter i.e., bid cancellation letter because the complainant failed to produce sufficient sureties.  Hence, as there is no option to the opposite party except to cancel the chit, issued a bid cancellation letter and the same was received by the complainant, but the complainant have not taken any steps to produce sufficient sureties. 

4.       After that on 12.01.2013 the opposite party issued a letter to the complainant with a request to pay the over due amounts and in respect of the chit and with a request to clear to pay the installments regularly each month  and to pay Rs.76,843.36p.s. as on 27.01.2013 and also mentioned if the complainant failed to pay that amount, he will be removed from the list of subscribers as per the terms of the Chit Fund Act and the said letter was received by the complainant also.  But the complainant have not shown any interest to clear the outstanding amounts.  Then on 08.02.2013 the opposite party issued a letter i.e., Notice of Membership Removable under the Chit Fund Act 1982.  

5.       The actual amount paid by the complainant to the opposite party is Rs.1,13,497/- and less company commission or damages of break of contract Rs.25,000/- (i.e., 5% on the chit value) and the incidental charges or notice charges Rs.150/- and totally Rs.25,150/- less in the actual amount paid by the complainant and the complainant paid Rs.1,13,497 - Rs.25,150= Rs.88,347/-, hence the opposite party is ready and willing to pay Rs.88,347/- after completion of chit i.e., December, 2014.  The opposite party stated that they issued a letter to the complainant on 15.12.2011 with a request for payment of chit amount and in the said letter, the 2^nd surety was rejected because he is not a competent person to stood as a surety to the complainant’s chit, but the complainant did not take any steps to submit fresh surety regarding the change of 2^nd surety.  Hence, there is no deficiency of service on the part of the opposite party and the complainant has to produce sufficient sureties as required by the opposite party, but he failed to do so.  Hence, the complaint is to be dismissed. 

6.       At the time of enquiry, the complainant filed his evidence affidavit along with documents and Exhibits A1 to A3 are marked and also filed written arguments with petition and as per representation made by the counsel of the complainant at the time of hearing treated it heard.  On the other hand, the opposite party filed its counter and evidence affidavit and Exhibits B1 to B6 are marked.  Heard counsel of the opposite party who reiterated his version. 

7.       In view of the respective contentions, the point that would arise for determination is:-

Whether there is any deficiency in service on the part of the opposite party, if so can the complainant entitle for the reliefs prayed for?

8.       Exhibit A1 is the pass book with chit reference NO.FMVLO4J-8 clearly shows that the complainant paid 13 installments i.e., up to September, 2012 and there in the column clearly shows cumulative total is Rs.1,62,500/- including dividends, it is not disputed by the opposite party.  Exhibit A2 is the legal notice issued by the complainant on 09.07.2013 to the opposite party for payment of bid auction amount.  Ex.A3 is the reply notice issued by the opposite party dated 24.08.2013 wherein, the opposite party mentioned that the opposite party is ready and willing to pay Rs.79,253/- because the complainant failed to produce sufficient sureties. 

9.       The version of the complainant is that after participating in auction and being a successful bidder and even after submission of sureties as required by the opposite party, the opposite party failed to pay the amount and after that the complainant did not pay the future amount to the opposite party and he issued notices to the opposite party, but the opposite party did not pay either the bid amount or the amount paid by him up to 13 installments. 

10.     The opposite party’s main plea is that the complainant paid 13 installments up to September, 2012 and failed to submit the sufficient sureties as required by the opposite party.  Exhibit B1 i.e., first memo regarding the chit of the complainant clearly shows that the opposite party mentioned “change of 2^nd guarantor and take two more sureties net salary of Rs.24,000/- and Ex.B2 is the Bid Cancellation Letter issued by the opposite party on 18.10.2012 wherein,  it mentioned regarding the participation in auction by the complainant and opposite party requested to furnish sufficient sureties and draw the prized amount within 7 days of receipt of the letter failing which the complainant’s bid will cancel as per Chit Fund Act.  Before that, the opposite party also issued a letter to the complainant i.e., Ex.B3 wherein the opposite party clearly mentioned that “the prized amount has been deposited in approved bank in current account and the complainant will be eligible to draw this amount only if he submit sufficient surety for due payment of future subscription and also mentioned that the sureties submitted by the complainant are not acceptable and advised to offer acceptable security and draw the prize amount”. Ex.B4 is the letter issued by the opposite party under Certificate of Posting on 12.01.2013 regarding the due payments by the complainant and the opposite party made a final request for immediate payment of due installments of Rs. 76,843.36p.s and also mentioned that if the complainant failed to pay that amount, his name will be removed from the list of subscribers as per the terms of the Chit Fund Act.  After that the opposite party issued another letter to the complainant i.e., Removal Letter on 08.02.2013 which is marked as Ex.B5 wherein, the opposite party mentioned that inspite of the notices sent to the complainant, he failed to pay the arrears, hence the opposite party constrained to remove the complainant from the membership on 08.02.2013 and the termination of the chit or as per the provisions of the Chit Fund Act, the amount due to the complainant is Rs.88,347/- after the deduction of company’s commission and incidental charges.  Ex.B6 is the account copy filed by the opposite party from their ledger wherein it clearly shows the chit value, monthly subscription date of commencement and the total subscription made by the complainant and dividend received by him. 

11.     After careful analysation of the facts of the complainant and opposite party with related documents, the Forum is of the view that the auction was conducted on 25.08.2012 and the complainant produced some sureties but the opposite party rejected some of those sureties and asked the complainant to submit sufficient sureties, but the complainant failed to do so.  It is to be noted that the auction was conducted on 25.08.2012 but the complainant issued legal notice nearly after one year i.e., 09.07.2013 till that date, he did not take any action, if really he submit sufficient sureties as required by the opposite party, he will not keep quite nearly for one year.  That too Ex.B1 clearly shows that the opposite party requested the complainant to change the 2^nd guarantor and to submit sufficient sureties as per their requirement, because the future liability is Rs.3,50,000/- as on that date.  Exhibits B2, B3 and B4 clearly shows that the opposite party requested the complainant to submit the sufficient sureties and to pay the due amount up date and also requested the complainant to withdraw the prized amount by submitting the sufficient sureties but the complainant failed to do so.  Then, the opposite party also issued a removal letter and expressed its willingness to pay the amount paid by the complainant excluding dividend is Rs.1,13,497/- and after the company’s commission and incidental charges balance amount is  Rs.88,347/- and opposite parties are ready to pay that amount to the complainant. 

12.     Thus, it is evidenced that the opposite party issued several letters to draw the prized amount by submitting necessary sureties to the complainant, but he kept quite and more over the complainant demanded in his relief about the chit auction amount of Rs.3,92,800/-, but how he is entitled for that amount as he failed to produce sufficient sureties to opposite party after auction within time and that too he is a defaulter after his participation in auction.  Hence, he cannot claim that amount.  The alternate relief i.e., the opposite party has to pay Rs.1,62,500/-, but as per Ex.A1 and Ex.B6 the total amount paid by the complainant actually is Rs.1,13,497/-, hence the complainant cannot entitled the amount of Rs.1,62,500/- which includes dividends, which are already received by the complainant.  Hence, in our view, the complainant can entitle the amount of Rs.88,347/- only with 9% interest from the date of complaint i.e., 04.09.2013.

13.     The opposite party has to deposit the amount which they expressed their willingness to pay the amount in a bank, but the opposite party failed to do that.  Hence, allowing Rs.5,000/- towards compensation is just and proper.

          Accordingly, this point is answered.

14.     In the result, the complaint is allowed directing the opposite party to pay Rs.88,347/- with 9% p.a. interest from 04.09.2013 till date of payment.  The opposite party is further directed to pay Rs.5,000/- towards compensation besides costs of Rs.1,500/-.  Time for compliance is two months. 

Dictated to the Shorthand Writer, transcribed by her, corrected and pronounced by us in the open Forum on this the 29^th day of January, 2015.

    Sd/-                                                                        Sd/-

Member                                                                 President (FAC)

                                                                   District Consumer Forum-I 

                                                                             Visakhapatnam

Consumer Complaint No:223/2013

APPENDIX OF EVIDENCE

Exhibits Marked for the Complainant:

Exhibits Marked for the Opposite Party:

    Sd/-                                                                       Sd/-

Member                                                                  President (FAC)

                                                                   District Consumer Forum-I

                                                                             Visakhapatnam

//VSSKL//