This complaint coming up before us for final hearing on 16-07-14                                in the presence of Sri M. Sravan Kumar, advocate for complainant and of                        Sri L. Vijay Kumar, advocate for opposite parties, upon perusing the material on record, after hearing both sides and having stood over till this day for consideration this Forum made the following:-

O R D E R

Smt T. Suneetha, Member:-    The complainant filed this complaint u/s 12 of the Consumer Protection Act, 1986 seeking a direction to  the opposite party  topay an amount of Rs.67,315/- with interest @ 24% p.a., from the date of complaint and Rs.2,00,000/- towards compensation for mental agony and for other costs of the complaint.

2.   In brief the averments of the complaint are these:

          The complainant purchased tractor by borrowing amount from the opposite party by entering into a loan cum hypothecation agreement on                16-08-07 to pay Rs.3,53,610/-.   The complainant invested his own money and purchased trailer to the tractor.  The complainant paid some installments to the opposite party and due to unseason and lack of work failed to pay the remaining installments.  Whileso, the opposite party repossessed the tractor of the complainant on 10-04-08 without giving any notice.   After that there is no information from the opposite parties regarding  the seized vehicle.   The complainant several times approached 2^nd opposite party to know the fate of the vehicle.   But there is no reply from the 2^nd opposite party.    All of a sudden the complainant received notice in EP No.130/12 in LT-RP 91/2009 on the file of III Addl. District Judge, Guntur asking him to appear on                      21-12-12.   The complainant appeared before the III Addl. District Judge, Guntur through his counsel and came to know that the opposite parties have sold complainant’s vehicle without following procedure laid down for auction of seized vehicle.   Later the complainant received another notice dated                          15-01-13 from OP1 asking complainant to pay Rs.1,08,802/- as one time settlement against Rs.1,18,888/-.   Through EP complainant came to know that opposite parties obtained arbitration award behind his back and now filed EP proceedings against him.  As per law the opposite parties supposed to inform the complainant before sale of the vehicle.   The opposite parties filed arbitration proceedings at Mumbai which is not place of agreement and thereby opposite parties committed deficiency of service.   The complainant hypothecated only the tractor but not the trailer.  But the opposite parties seized both tractor and trailer and sold both of them without any authority.   The cost of trailer itself is Rs.1,00,000/-.  The opposite parties seized tractor without any authority amounts deficiency of service.   The complainant got issued legal notice on 13-04-13 and the opposite parties No.1 to 4 gave reply on 02-05-13 with false allegations.   Hence the complaint.  

3.  The Opposite parties 2 to 4 filed memo adopting the version of                            1^st opposite party and its contents in brief are hereunder:

          The Hon’ble Forum has no jurisdiction to entertain this case.   The complainant is bound by the jurisdiction set forth in the agreement executed between himself and opposite parties.   As per arbitration clause 14 of the loan cum hypothecation agreement dated 16-08-07, “Any dispute and/or differences and/or claims arising under the said agreement or any matter incidental thereto shall be subjected to Mumbai jurisdiction”.   

The opposite parties pursuant to the proposal of the complainant and               Mr. Kolla Srinivasa Rao (guarantor) have given a loan to the complainant under loan cum hypothecation agreement dated 16-08-07 vehicle with No.SWARAJ PTL 733 FE bearing chassis No.QSTD 21205007747, Engine No.461350HP001030 Mr. Kolla Srinivasa Rao as guarantor signed on necessary security documents such as promissory note, loan cum hypothecation agreement and letter of guarantee.   The said tractor was hypothecated infavour of the opposite parties as security for the loan.

     The complainant failed to carry out his obligations under the said agreement and failed to pay the installment amount inspite of repeated requests and demands made by the opposite parties.   As empowered under the said agreement the opposite parties repossessed the hypothecated tractor on 10-04-08 and sold the tractor for Rs.2,00,000/- on 21-11-08.   The opposite parties credited net sale proceeds to the account of the complainant.   Despite sale the opposite parties could not recover the dues payable by the complainant and his guarantor.   The opposite parties got issued legal notice dated 04-05-09 to the complainant and his guarantor calling upon them to make payment of the said dues.   It was made known to the complainant that on their failure to make payment the arbitration clause 14.1 and 14.2 shall stand invoked and referred to sole arbitrator Mr.B.B.Jain.            

The opposite parties referred the dispute to sole arbitrator Mr. Bharat B. Jain under arbitration No.LT-RP-91 of 2009 at Mumbai.   Notices were sent to the parties at the last known address.   Thereupon the arbitrator passed an award on 22-09-09 in favour of the opposite parties directing the complainant and the guarantor to pay Rs.1,25,434/- with an interest of 36% p.a., from 22-11-08 to 28-05-09 and 48% from 29-05-09 till realization.   Costs of the arbitration fixed at Rs.2500/- and fees of the arbitration fixed at Rs.3500/-.   The complainant and the guarantor failed to obey the said award.   The opposite parties got filed EP No.130/12 in the above referred case on the file of III Addl. District Judge, Guntur for recovery of Rs.2,04,849/- and sought for sale of the EP schedule immovable properties belonging to the complainant.   The Hon’ble Court also ordered attachment of the EP schedule properties belonging to the complainant.   The complainant entered into appearance in the said EP and later got issued legal notice dated     13-04-13 with all false and baseless allegations demanding the opposite parties to withdraw the EP and to pay Rs.2,00,000/- towards compensation.   The opposite parties replied suitably on 02-05-13.   

The allegations of the complainant that the opposite parties seized trailer also is false.   The opposite parties have sold only tractor but not the trailer as alleged.  

     The complainant owns and posses about Ac.7.66 of land in D.Nos. 273, 275, 276, 279-B, 286-2A, 287-A and 301-2A of Phanidam village, Sattenapalli Mandal, Guntur district.   The complainant alleging about his loss of income and now leading a life of agriculture labour is false.  

     The complainant filed this case with a view to protract EP proceedings pending before the Hon’ble III Addl. District Judge, Guntur and thereby cause wrongful gain for himself.  Therefore, there is no deficiency of service on the part of opposite parties.  The complainant is not entitled for any compensation.   The Hon’ble Forum may be pleased to dismiss the complaint with exemplary costs.  

4.      The complainant and opposite parties filed their respective affidavits. Exs.A-1 to A-11 were marked on behalf of the complainant and Exs.B-1 to B-6 were marked on behalf of opposite parties.

5.    The points that arose for consideration in this complaint are these:

    1. Whether the complaint is within the limitation under the purview of                         Consumer Protection Act, 1986?

   2. Whether the opposite parties committed any deficiency in service?

   3.  To what relief?

6.   POINT No.1:-    The complainant entered into an agreement with the opposite parties for obtained loan of Rs.3,53,610/- on 16-08-07 and purchased tractor.   The opposite parties repossessed the tractor of the complainant  on  10-04-08 and sold for Rs.2,00,000/- on 21-11-08.    The complainant alleged that the opposite parties repossessed not only the tractor but also trailer without giving any notice to the complainant.  The opposite parties carried on arbitration proceedings behind his back and got award against the complainant and filed EP 130/12 in LT-RP-91/09 on the file of III Addl. District Judge, Guntur asking the complainant to appear on                21-12-12.  The complainant further alleged that he came to know about the sale of the vehicle when he was asked to appear in the III Addl. District Judge, Guntur on 21-12-12.  Later the complainant received another notice on 15-01-13 from the opposite parties asking the complainant to pay Rs.1,08,802/- against Rs.1,18,888/- as one time settlement. 

7.      The registry took objection about the limitation of the complaint.   The complainant answered to the objection that he came to know the sale of the tractor and trailer by the opposite parties on 21-12-12 i.e., the date of receipt of notice in EP.No.130/12 on the file of III Addl. District Court, Guntur.   The Forum gave a direction on 05-03-14 as follows:

          “………….It appears prima facie that the complaint is in time even considering the period taken from 31-07-13 till today as envisaged under 9(5) of the Consumer Protection Regulations, 2005.  Hence the registry is directed to number the petition if otherwise in order.”

8.      The complainant is aware of the seizure of the vehicle by the opposite parties.   The opposite parties seizure of the vehicle follows the sale according to their condition No.11.1 of the agreement.   The complainant must have known about the sale of the vehicle before opposite parties taking up the arbitration proceedings.  

9.      The complainant took loan on 16-08-07 and his vehicle was repossessed on 10-04-08 by the opposite parties.   The complainant filed this complaint on 09-07-13.   The complainant kept quite from 10-04-08 till                  09-07-13 i.e., the date of filing.  The limitation as per the provisions of Consumer Protection Act is two years from the date of cause of action.  In this case the cause of action arose on 10-04-08 when the opposite parties seized the vehicle of the complainant.   The complainant ought to have filed the complaint in this Forum within two years from the cause of action i.e., 09-04-10. 

10.  In view of the above discussion, the Forum came to considered opinion that the complaint is not filed within the limitation period stipulated under the provisions of the Consumer Protection Act and it is not maintainable before this Forum and answered this point against the complainant.  

11.  POINTS  2 & 3:-    Point No.11.0 ‘Events of default and termination’ of the terms and conditions of ‘loan cum hypothecation agreement’ (Ex.B-1) reads as follows:

          “11.1:  EVENTS OF DEFAULT-

                   If one or more of the events specified in clause hereunder and herein after called events of default occur.   Lender may by notice in writing to the borrower forthwith call the said loan together with all interest, compensation and other moneys payable by the borrower pursuant to this agreement and to enforce the security created in terms of this agreement.   Further, notwithstanding any other rights that lender shall be entitled at all times to take charge and or possession or seize, recover, appoint receiver and/or Manager and/or remove the said equipment and/or without the intervention of court shall sell by, public auction or by private contract at the best available prices according to the prevailing market condition, dispatch or consign for realization or deal with the same to realize its claims in respect of the said loan and balances due and payable hereunder without being bound or being liable for any losses that the borrower may suffer due to such action of lender and without prejudice to the lender’s other rights and remedies as stated herein or otherwise in law entitled to.   Incase the net sales proceeds, after deducting all costs, charges and expenses incurred by lender are not sufficient to meet in full and dues of the borrower hereunder, the borrower shall make good and pay such deficiency to the lender”.     

12.    As per the above clause the opposite parties are provided with a right to make the loss good occurred to them by way of selling the hypothecated subject.   The opposite parties have taken up the same action as prescribed by the terms and conditions of the agreement.    

13.    In Sasanapuri Someshwara Rao, Sasanapuri Lakshmi Voola Gupteswara Rao vs. Shri Ram Transport Finance Company Limited and others (2013 (2) CPR 55 (AP) it was held that taking possession of vehicle on the ground of non-payment of installment is a legal right of financier.

14.    In view of the above condition and citation, the Forum opines that there is no deficiency of service on the part of the opposite parties.   Since the complaint is not filed within the limitation period stipulated under the provisions of the Consumer Protection Act and is not maintainable in this Forum.

          In the result the complaint is dismissed without costs.

Typed to my dictation by Junior Stenographer, corrected by us and pronounced in the open Forum dated this the 30th day of July, 2014.

MEMBER                                     MEMBER                              PRESIDENT

 APPENDIX OF EVIDENCE

DOCUMENTS MARKED

For Complainant:

For 1^st opposite party:   

                                                                                              PRESIDENT

NB:   The parties are required to collect the extra sets within a month after receipt of this order either personally or through their advocate as otherwise the extra sets shall be weeded out.

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