Karnataka

Bidar

CC/69/2014

BASWARAJ S/O SHIVAJIRAO - Complainant(s)

Versus

MAHINDRA & MAHIDRA FINANCIAL SERVICES LTD BIDAR - Opp.Party(s)

P M DESHPANDE

28 Feb 2017

ORDER

::BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

AT BIDAR::

 

 

                                                                                                                 C.C.No. 69/2014

 

                                                                                                  Date of filing : 18/08/2014

 

                                                                                             Date of disposal : 280/02/2017

 

 

P R E S E N T:-                    (1) Shri. Jagannath Prasad Udgata,

                                                                                         B.A., LL.B.,

                                                                                                       President.

    

                                              (2) Shri. Shankrappa (Halipurgi),

                                                                                 B.A.LL.B.,

                                                                                              Member.

 

                                   

 

                                               

COMPLAINANT/S:          Baswaraj, S/o Shivajirao,

                                          Age : 42 years, Occ: Self Employment,

                                             R/o H.no.18/57, Ward no.16,

                                             Near Govt. Hospital, Koliwada,

                                          Tq.Humnabad Dist. Bidar.

                                              

 

 

                                         (By Shri. P.M. Deshpande, Advocate)

 

 

                                                      VERSUS

 

OPPONENT/S   :-               Mahindra & Mahindra Financial Services Ltd.,

                                            Udgir road, Opp. Kamat Hotel, Bidar.

 

                                     

  

 

 

                                        (By Shri. S.Wilson, Advocate )   

 

 

                                                

::   J U D G M E N T  : :

 

 

 

By Shri. Jagannath Prasad Udgata, President.

 

                    This is a complaint filed by the above said complainant U/s.12 of the Consumer Protection Act., 1986, against the O.P alleging deficiency in service on the part of O.P.

 

 

  

 

2.         Brief facts of the case of the complaint are :

 

          The complainant is a  native of Tq.Humnabad , Dist.Bidar.  Being unemployed, for his livelihood had purchased Tipper vehicle bearing no. KA.39/8391 from Muneer Motors Pvt. Ltd, Hospet by availing loan facility from the O.P. and the complainant had paid all the EMIs regularly.  The complainant avers that, the said vehicle was brought for repairs to a mechanics shop at Humnabad.  At the time, the vehicle driver, by name Mustafa son of Fhakru Patel was plying the vehicle, to bring the vehicle to the mechanics shop for repair.  The Henchman of the O.P arriving at the workshop had forcibly taken out the keys of the vehicle and thereafter they had seized the vehicle and drove away the same to un known place.  Thereafter, the driver of the vehicle had intimated to the complainant.   The O.P. had seized the vehicle without giving any prior notice to the complainant. Due to unlawful seizure of the vehicle, the complainant lost his earning and was to put to inconvenience.  This act of the O.P. shows there is deficiency in service by the O.P.  Hence, the complainant has filed the complaint before us praying that the O.P. be directed to refrain from conducting the auction sale or disposal of the vehicle till disposal of this case and cost be awarded against the O.P.  In view of the auction sale already effected by  the O.P., complainanit’s  prayer for restrainemnt order has been rendered infructuous.

 

 

 

3.            The O.P. on receipt of notice from the Court had put up appearance through counsel of it’s choice and has filed written version wherein it is stated that, the allegations mentioned in para no. 2 of the complaint in respect of the vehicle bearing no.KA-39/8391 brought to nearby Mechanical shop at Humnabad and thereafter,   some henchman had forcibly attacked the driver and taken out the key of the vehicle and carried the vehicle to unknown place are all false  hence denied.   The O.P. has denied the contention of para 3 to 5 of the complaint.  The O.P. further states that on 11/10/2012 it had sanctioned loan for Rs. 7,60,000/- to the complainant for the Mahindra Load king Fully Built Tipper vehicle bearing no. KA-39/8391.  The complainant  executed loan agreement on 11/10/2012 after understanding the terms and conditions of the loan facility and also signed offer letter dated 10/10/2012.  As per the terms and conditions of the loan agreement, complainant agreed to repay the loan in 48 instalments of Rs.22,040/- each but, the complainant had failed to pay the instalments even after several request and reminders, and thereby committed breach of contract.  On 31/08/2013 complainant handed over vehicle to O.P. vide surrender letter dated 31/08/2013 and promised to get release the vehicle by paying entire dues.  As per the procedure, The O.P. issued pre-sale notice on   13/09/2013, 23/09/2013 and 03/10/2013 respectively, requesting complainant to pay the dues and to take back the vehicle but, complainant had not responded to the notice.

 

4.              On 16/01/2014 O.P. received legal notice from the complainant with some false allegations, the O.P. replied the notice requesting him to clear his dues and to get release the vehicle, but no response by the complainant.  Hence to avoid further loss, the O.P. had auctioned the vehicle for Rs.3,86,000/- and after adjusting sale proceeds Rs.4,59,572/- is still balance amount which has to be paid by the complainant.  The O.P. further avered that the complainant has come with malafide intention to escape from legal liability.  If he had suffered any loss/injury by the O.P., he could have approached appropriate Forum immediately after giving possession of the vehicle but there was delay of 13 months for filing the complaint.   The O.P. further avered that the complainant in his notice dated 16/01/2014 in para no.2 alleged that one Mr. Jagannath was driving the vehicle on the day of seizure, and in his complaint he has mentioned that Mr.Mustafa, S/o Fhatru Patel was his driver that itself establishes that, the story was created just to escape from the legal liability.  It is pertinent to point out that Clause 3 (n) of the Loan Agreement, clearly states that, the obligation of the complainant to pay the periodical instalments would not be subject to any change on account of any product failure.  The said provision is extracted  herein below.

 

“3 (n) The Borrower was obliged to pay instalments every month during the contracted period regardless of whether the product requires repairs or is otherwise not operatable or working and the lender shall not be liable or responsible in any manner for non-performance, if any, of the Product and further the Borrower shall look solely to the manufacture/supplier /or dealer as the case may for the performance of all guarantees and warranties with respect to the product”.

 

The interest has been charged as per the terms and conditions of the loan agreement and same was agreed by the complainant during execution of loan agreement dated 11/10/2012.  The complainant has made false allegations which is contrary to the terms and condition of the loan agreement.  As per clause no.26 of the loan agreement, all disputes, differences, claim arising out of these presents or in any way touching/concerning the same or as to constructions, meaning or effect hereof or as to the right and liabilities of the parties hereunder shall be settled by arbitration to be held in accordance with the provisions of the Arbitration and conciliation Act, 1996.  The complainant did not take any proper steps since from the execution of the loan agreement, but now he has come with several false allegations against the O.P. after receiving the demand notice for balance recovery.  Further the complainant has filed Civil suit before the Junior Civil Judge at Humnabad against the respondent (i.e., O.S.no.19/2014) with same allegation and matter is still pending before the Civil Court.  Hence, the complaint filed by the complainant may be dismissed with costs.

 

5.              The feuding parties have submitted documents as per the list at the end of this order, evidence affidavits, written arguments and were heard in length

 

 

 

 

 

 

 

6.         Considering the rival contentions of the parties, the following points arise for our consideration:-

 

1. Does the O.P. prove that, the complainant cannot maintain this complaint?
2. Does the complainant prove that, there has been a deficiency of service and unethical trade practice in the part of the opponents?
3. What order?

 

 

 

7.              Our answers to the points stated above are as follows:-

 

1.   In the negative.

          2.    In the affirmative.

2.  As per the final order, owing to the following:

 

 

                                                                                                      

 

 

 

 

 

 

 

 

 

 

 

 :: REASONS ::

 

8.  Point No.1.            The O.P. primarily raises an objection that, in an alleged notice date. 16.01.2014, the complainant had informed about the seizure of the vehicle from one Sri Jagannath, where as in the complainant he states the vehicle was seized from one Mustaffa and hence the story is a created one.  The O.P. further canvasses that, in view of the arbitration clause in the loan agreement, the present complaint should not have been preferred.  Next, the O.P. submits that, the complainant having approached the court of the Civil Judge (Jr.Divn.) Humnabad in O.S. No.19/2014 with same allegation, the present case be dismissed with costs.  The swiping of Drivers’ name as is being hyped by the O.P. in our opinion is a trivial one, due to the  later discussions to be held in disposal of the case.  However, it may be put here on record that, Section 3 of the C.P.Act,1986.  Mandates  the Act is in addition and not in derogation of any other law for the time being in force.  Additionally, neither party has submitted before us the so called legal notice date: 16.01.2014 or the plaint’s copy of the original suit alleged by the O.P. here in before.  The O.P. has rather vide its vague submissions without any substantial proof is trying to obfuscate the matter deplorably.  Hence, we answer the point No.1 accordingly.

 

9.   Point No.2.         In the instant case, the complainant has stated that, the vehicle was unlawfully seized from his driver 30.08.2013.  Juxtaposed the claim of the complainant, the O.P. claims that, the vehicle was surrendered by the former on 31.08.2013.  To our surprise, the O.P. has never produced any such surrender memo or letter before us.

 

10.               That, apart, we find, Ex.P.1 to P6, evidence that, the complainant has remitted a sum of Rs.1,47,470/- to the O.P. towards E.M.I. dues.  By that time, he should have paid a sum of Rs.2,20,400/- (Sum total of 10 E.M.I.S.) which works out the difference to be a sum of only Rs.72,930/- in all as the short fall.  Does a prudent man would ever forsake an ownership of an article worth of lakhs against such a paltry sum?  We consider such a proposition beyond preponderances of probabilities and hence hold that, the canvassment of the complainant about seizure holds good.

 

11.                   The entitlement of the O.P. about the seizure of the vehicle is being justified by a plethora of judgements quoted by him and they read as follows:-

 

2012 (4) CpR 313 (NC) Surendra Kumar Sahoo V/s Branch Manager, Indusind Bank Ltd. Ratio: Consumer Protection Act, 1986-Sections 15,17,19 and 21-Banking-Vehicle loan-Seizure of  vehicle without any notice for default in repayment of instalments- Complaint dismissed by State Commission- As per agreement there was no need to give prior notice- Petitioner waddled out of his commitments and he was defaulter – The moment he did not pay instalment it gives legal right to financier to repossess vehicle- Mere fact that possession was taken by respondents cannot be ground to contend that hirer is prejudiced- Revision petition dis-missed.       2012(4)CPR75(NC) Shriram Transport Finance Co.Ltd. and Anr. V/s Mr.Chaman Lal. Ratio:    Consumer Protection Act, 1986-Sections 15,17,19 and 21- Financial services- Hire Purchase-Repossession of vehicle- Complaint allowed by Fora below- Petitioner financed tractor and Loan-cum-Hypothecation Agreement was executed between complainant and petitioner and pursuant to this agreement petitioner was bound to pay instalments- Even after seven months Complainant paid only Rs.20,000/- towards instalment and failed to pay rest of instalments –IN such circumstances possession of tractor was taken by representative of petitioner- Information to hirer, guarantor and two police stations was also given by petitioner- In absence of payment   of instalments and due amount, if possession of vehicle was taken by petitioner or surrendered by complainant and sold in auction, petitioner has not committed any deficiency in providing service-Impugned order set aside-Revision petition allowed.   2015(1)CPR367(NC) Director,Berar Finance Ltd. V/s Satishkumar Prabhakarrao Borker. Ratio:   Consumer Protection Act,1986-Sections 15,17,19 and 21-Finanve services-Vehicle loan- Repossession and sale of vehicle-Default in payment of instalments- District Forum allowed complaint and directed opposite party to refund Rs.52,416/-with 18% interest or in alternate allot new motor cycle and further granted compensation of Rs.10,000/- and cost of Rs.2,000/- Four cheques issued by complainant were dishonoured on account of fault of petitioner-Amount remained outstanding against complainant and complainant was under obligation to make payment of dishonoured cheques-As vehicle had been possessed on account of default in payment of instalments and has been sold after due notice, no deficiency on part of opposite party can be presumed- Order passed by State Commission and District Forum set aside and complaint dismissed.

Here in but, we find the seizure of the vehicle has taken place without taking any recourse to law, and later the vehicle has been sold in a so called public auction against a sum of Rs. 3,86,000/- by th O.P. Albeit the O.P. claims to have sent notices of pre auction vide Ex.R.2, R3, andR4, the same were never served upon the complainant as would be evident from Ex.R.5.  The notices were received by some unknown personalities, whose nexus with the complainant were never explained by the O.P. effectively.  Hence, we hold that, the so called pre-auction notices were self serving, to suit the unethical action of theO.P. of effecting an illegal seizure to materially gain at the cost of the borrower/ complainant.

 

12.                   We are constrained to put here on record that, the Hon’ble Apex Court, vide its’ Judgement reported in 2012(1) S.C.C.1-(Citicorp Maruthis Fi Ltd. V/s Vijayalaxmi) referring to an earlier judgement reported in 2007 (1) S.C.C..489 (ICICI Bank Ltd. V/s Prakash Kaur) has deprecated the actions of Financial Institutions, seizing the hypothecated elements without taking recourse of law in courts of competent jurisdiction.  Notwithstanding the judgements of the Hon’ble National Commission canvassed by the O.P. we are constrained to follow the law declared by the supreme court under Article 141 of the constitution of India and hence hold that, there has been deficiency of service/unethical trade practice in the part of the O.P., and hence we proceed to pass the following:-

 

:: ORDER ::

 

   

1. The complaint is allowed in part.
2.  The O.P. having transferred the ownership of the vehicle to a third party, who is not before us, we would decline to turn down the apple cart..
3. The O.P. defiling the normal procedure and law would be precluded to charge anything from the complainant here afterwards.
4. The O.P. has to pay a sum of Rs.20,000/- to the complainat towards compensation and a further sum of Rs.5000/- towards litigation expenses to the complainant.

 

 

           d)  Four weeks time is granted to comply the order at cl.(d) above.

 

 

( Typed to our dictation then corrected, signed by us and then pronounced in the open Forum on this 28^th  day of  February-2017 )

 

 

 

   Sri. Shankrappa H.                                             Sri. Jagannath Prasad                                  

Member.                                                                President.                                                                                            

 

 

 

Documents produced by the complainant

1. Ex.P.1 to P.4 Original receipts.
2. Ex.P.5- Cash receipt, dt.26/04/2013.
3. Ex.P6-  Cash receipt, dt.27/06/2013.
4. Ex.P.7 –Road tax paid receipt,dt.07/12/2012.
5. Ex.P.8- Goods Carriage Permit.
6. Ex.P.9-  Certificate of Insurance of Goods Carriage.
7. Ex.P.10-Notice by Mahindra Finance,dt.23/09/2013.  
8. Ex.P.11-Copy of Gate Pass certificate,dt.20/11/2012.
9. Ex.P.12- Receipt of Muneer Motors,dt.07/11/2012.
10. Ex.P.13- Receipt of Muneer Motors,dt.06/11/2012.
11. Ex.P.14- Copy of Sale Certificate,dt.30/10/2012.
12. Ex.P.15-Original R.C.
13. Ex.P.16-Coppy of Pollution certificate.

 

 Document produced by the Opponent

 

1. Ex.R.1 – Copy of loan agreement.
2. Ex.R.2- Copy of notice by Mahindra Finance,dt.13/09/2013.
3. Ex.R.3- Copy of notice by Mahindra Finance,dt 23/09/2013.
4. Ex.R.4- Copy of final notice by by Mahindra Finance,dt.03/10/2013.
5. Ex.R.5- Copies of Acknowledgements (2)
6. Ex.R.6. Copy of notice, by Mahindra Finance,dt.26/09/2013
7. Ex.R.7- Copies of Acknowledgements (2)

 

 

 

Sri. Shankrappa H.                                             Sri. Jagannath Prasad                                  

       Member.                                                                      President.

 

 

mv.