D.O.F:15/01/2014

                                                                                                             D.O.O:30/09/2020

IN THE CONSUMER DISPUTES REDRESSAL FORUM, KASARAGOD

CC.No.16/2014

Dated this, the 30^th day of September2020

PRESENT:

SRI.KRISHNAN.K                         :PRESIDENT

SRI.RADHAKRISHNAN NAIR.M : MEMBER

SMT.BEENA.K.G                            : MEMBER

Mr. Abid  A.P,

S/o Umbuchi Thangal, Muslim

R/at Payanghadi House, Adhur, Mulleria                                   : Complainant

Kasaragod – 671321

                                                                        And

M/s Mahindra & Mahindra Finance

2^nd floor, City center, Bank Road Kasaragod                      : Opposite Party

Rep by its Manager

(Adv: Babuchandran.K)

ORDER

SRI.KRISHNAN.K  :PRESIDENT

1.      The complaint filed under section 12 of Consumer Protection Act.  The averments in the complaint is that complainant availed a vehicle loan for his car.  He hypothecated the vehicle to the Opposite Party finance company entered in to an agreement agreeing the liability Rs.1,75,000/- repayable in 46 EMI.  Details of loan interest rate not explained thus darkness of terms and conditions but obtained signature and did not even supply copy.  He expressed his willingness to close the loan on 11/01/2014.  But Opposite Party insisted interest at 36% penal interest.  The Opposite Party threatened re-possession, public auction of the vehicle.  Thus he suffered emotional insult mental agony physical strain and claimed the following reliefs(a) directing the Opposite Party, to redeem loan account in accordance with law, restraining Opposite Party from seizing vehicle illegally and such other reliefs under section 14(1) of the Act. 
2.      The Opposite Party filed the written version, allegations in the complaint is denied specifically and in particular denied that signature obtained without making him to understand the contents or supplying copy of agreement Opposite Party stated that the agreement amount is Rs. 2,33,680/- dated15/09/2010.  Complainant failed to pay installments commencing from 15/08/2013 complainant promised to pay the amount due.  But failed to comply.  As on 11/10/2014, Rs.53500/- is due towards account balance Rs.25756/- as additional finance charge for the late payment.  There is no deficiency in service and prayed for dismiss the complaint.
3.      Complainant examined one witness to show rate of interest fixed by RBI as 11.33%.  Documents are marked as Ext A1 to A17 payment receipt.  Opposite Party did not adduce oral evidence. On 21/01/2020 Opposite Party produced arbitration Award dated  20/03/2014.
4.  Following points arise for consideration in this case:

1. Whether consumer complaint could be decided by consumer Fora after passing of Arbitration Award on the same facts on merits?
2. Whether there is any deficiency in service unfair trade practice, and violation of money lender Act?
3. Whether complainant is entitled to any reliefs? And if so for what reliefs?

All the points are discussed together and findings are recorded accordingly for convenience.

5.      The award by arbitrator is dated 23/03/2014.  But arbitration proceedings initiated long prior to that date namely on date of hearing on 06/02/2013.  Consumer complaint was filed only on 15/01/2014 long after initiation of arbitration proceedings.  It is proved on record that Arbitration proceedings were initiated prior to filing of consumer complaint.  Complaint could agitate the award before competent authority of law.
6.      Submission of the learned advocate appearing on behalf of Opposite Party is that it is against the principle of Natural Justice to dispose the consumer complaint on merits keeping in view the final award passed by arbitrator.  It was held by Honourable National Commission in the case reported in 2006 (3) CPR 339 NC tittled installation supply Ltd Vs Kangra Ex- service man transport Co. and other that consumer complaint could not be decided by consumer Fora after passing of final award by Arbitration under Arbitration and conciliation Act 1991.  It is well settled law that ruling given by Honourable National Commission is binding up on District Forums.
7.      The Opposite Party produced the award which shows that vehicle was seized on 06/02/2013, itself as per orders of Tribunal but relief is claimed restraining the Opposite Party from illegally seizing the vehicle.  Award also directs adjust  sale proceeds of assets and adjust any other amount received during pendency of arbitration.  Complainant has no case award passed by the arbitrator is complied.
8.      Advocate for complainant argued that even no notice was served upon the complainant before referring the matter to the arbitrator, therefore the arbitral award was not binding the complainant and district Forum has jurisdiction to decide the matter. 

On behalf of complainant, decision is cited as below.

EMAAR MGF LAND LIMITED Vs AFTABSINGH 10 December 2018

2019 1 CPJ 5: 2018 4 CPR (SC)752; 2019 12 SCC 751 UDAY UMESH LALTT, ASHOK BHUSHAN,JJ.

1. Consumer Protection Act 1986 – section 3 r/w section 8 C ( prior to amendment 2015), Arbitration and conciliation Act 1996 – Act enacted for protection of consumer.  Its provisions in addition to and not in derogation of the provision of any other law for the time being in force Consumer Fora judicial authority Existence of arbitration agreement. Not a bar on exercise of power under Act 1986.
2. (f) Consumer Protection Act 1986 section 3 r/w section 8 (after amendment 2015) arbitration and conciliation Act 1996 – A party to dispute having option of arbitration and conciliation Act 1996.  A party to dispute having option of arbitration or special remedy under Act 1986.  Entitled to exercise option – once option of consumer Fora is exercised Judicial authority can refuse to refer the parties to arbitration. (para (55)

This decision is not relating to disposal of complaint by consumer Forum after passing of award by arbitrator and thus not applicable to the facts of the case.

9.      Opposite Party contents that District Forum, has no jurisdiction to try the case in view of passing of the award.  Opposite Party is owner of the said vehicle and the complainant defaulted in making of installments, therefore    Opposite Party sent notice to the complainant but failed to comply, further argued that the matter was reffered to the arbitrator and notice was duly served upon the complainant for appearance on 25/03/2013 as mentioned in award, though award was passed by arbitrator on 20/03/2014, whereas complaint filed before the Forum on 21/01/2020.
10.      Looking to the documents filed by both the parties it appears that the vehicle in question was purchased by the complainant after obtaining financial assistance from the Opposite Party. Hire purchase agreement was executed between the parties.
11.      In Installment supply Ltd Vs Kangra Ex- Serviceman Transport Co and other, Honourable National Commission observed that if arbitration Award already passed, all disputes between complainant and Opposite Party settled by arbitration in accordance with arbitration agreement.  Award passed before filing of the complaint – former will govern dispute between the parties and decision of the Arbitrator is binding upon the parties.
12.      Looking to the facts and circumstances of the case, we are of the view that once the matter is referred Arbitrator and award was passed by the arbitrator them the complaint before the District Forum under Consumer Protection Act is not maintainable.
13.      So far as merit of the case is concerned as per finance agreement and order of the Arbitrator, the complainant is not entitled to get ownership of the vehicle in question till such time he will comply the terms of the said agreement and make payment of all the installments costs charges and interest.  In these circumstance the Opposite Party did not commit any offence in taking steps for enforcing recovery of amount due under the loan agreement.
14.      Complainant did not even enter the box to adduce oral evidence to prove that he put his signature without reading or understanding the contents in the agreement relating to interest or such other terms.
15.      The allegations of the complainant hold no merit as no prudent person would simply sign any document without understanding its features and terms and conditions.

In Bharathi Knitting company Vs DHL World Wide Express Courier Division of Air freight Ltd (1996)4 Honourable supreme court observed this:-

“6    it was stated that a person who signs a document containing contractual terms is normally bound by them even though he was not read them and even though he is ignorant of their precise legal effect.In the instant case, the complainant admitted that he signed the loan agreement.

16.      In view of aforesaid discussions, the findings recorded reason given complainant failed to prove that there is any deficiency in service or unfair trade practice by Opposite Party in taking steps to enforce the agreement as per law.
17.      Therefore Forum finds that in view of reason aforesaid the complaint being devoid of any merit, deserves to be and is herby dismissed but without costs.

Sd/-                                              Sd/-                                                           Sd/-

MEMBER                                                MEMBER                                          PRESIDENT

Exhibits

A1 to A17 – Payment receipts

Witness Examined

Pw1- Baiju John

       Sd/-                                                    Sd/-                                           Sd/-

MEMBER                                          MEMBER                              PRESIDENT

                                                                                            Forwarded by Order

                                                                                         Senior Superintendent

Ps/