BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, ERNAKULAM.

Date of filing : 29/09/2008

Date of Order : 29/07/2011

Present :-

Shri. A. Rajesh, President.

Shri. Paul Gomez, Member.

Smt. C.K. Lekhamma, Member.

C.C. No. 353/2008

Between

 

And

O R D E R

Paul Gomez, Member.

1. The factual matrix :

The complainant availed a vehicle loan to the tune of Rs. 3,00,000/- from the 1^st opposite party. The original documents were handed over to the 1^st opposite party by the owner of the vehicle in the presence of the complainant. He could not ply the vehicle as taxi without the original documents. The complainant paid 4 instalments and demanded original documents. When it was denied he refused to make any further payments. The opposite parties repossessed the vehicle forcefully without due process of law and sold it to the third party. The 1^st opposite party demands the complainant to pay the balance amount towards the loan account that is outstanding after deducting the sale proceeds. The complainant also gives an account of a series of litigation with the opposite parties at various Courts. But all those cases did not bear fruit. In the present complaint, he is demanding Rs. 2,09,000/- (Rupees two lakhs and Nine thousand only) apart from a compensation of Rs. 50,000/- (Rupees fifty thousand only).

2. Versions filed by the 1^st and 2^nd opposite parties :

The 1^st opposite party contended that the original documents in relation to the vehicle are in the possession of the owner of the vehicle. It has never been handed over to the 1^st opposite party. The vehicle has been plied by the complainant. In order to circumvent the liability of repayment of loan account, the complainant has cooked up this false story. Both the cases pending before the Munsiff Court and the Hon'ble High Court were disposed off without granting any relief to the complainant. The vehicle after repossession was resold for a price of Rs. 2,10,000/- and the complainant is to pay the balance amount of Rs. 1,31,335/-. The complainant has not sustained any loss. Therefore, this complaint deserves dismissal.

3. The 2^nd opposite party denied any liability on their part out of the transaction between the owner of the vehicle, the financier and the complainant. The 2^nd opposite party is only a vehicle broker for negotiating sale and not involved in any other matters. It is understood that the 1^st opposite party repossessed the vehicle, because the complainant has committed default. He has nothing to do with the transaction and has been unnecessarily dragged into the complaint.

4. The 3^rd opposite party was served with notice, but they chose to remain absent. The complainant was examined as PW1. Exts. A1 to A7 were marked for him. Witness for the 1^st opposite party was examined as DW1. Ext. B1 was marked for them. Complaint was heard on both sides.

5. The following points arise for settlement :

i) Whether the 1^st opposite party is liable to return

the relevant documents?

ii) What are the reliefs, if any?

6. Point Nos. i) and ii) :- The proceedings in the Forum following the filing of this complaint seems to be the last lap of the race undergone by a loanee who has availed loan to support his dream of ownership of a Toyota Qualis Car. Earlier, the complainant had been frantically running after the lowest to the highest rung in the judicial hierarchy of the state. All those attempts unfortunately did not bear fruits. Now, he is before the Forum as the last resort.

7. The ordeal of the unfortunate man began with the availing of loan to the tune of Rs. 3,00,000/- from the 1^st opposite party bank which was to be paid in 30 EMI of Rs. 12,060/- each. The crux of the complaint is pertaining to transfer of relevant original documents such as R.C. Book, permit, insurance certificate etc. According to the complainant, his several requests to hand over the said documents made to the 1^st opposite party fell on deaf years. In the absence of those documents, the complainant was shy to take the vehicle in the public road as taxi. Still, he paid the first four instalments regularly. When his request for the original documents was turned down, he stopped paying instalments for dearth of funds since the transaction proved to be counter productive. Then, he moved the Munsiff Court and Hon'ble High Court to stall the opposite parties from repossessing and reselling the car to third party. In view of the affidavit stating that the documents were not in the possession of the 1^st opposite party, W.P.C. No. 26196 of 2006 was dismissed by the Hon'ble High Court by Ext. A5 order stating as follows :

“However, it is clarified that this judgment shall not affect any right of the parties inter se as regards the rights referable to the contract between them and they will be entitled to work out their remedies before the appropriate courts or other authorities in accordance with law.”

8. The following observation of his Lordship also is noteworthy for the just disposal of this complaint. The learned judge said : “It is apparent from that report that the Bank disputes the plea of the writ petitioner that it has custody of the R.C. Book. There are controversies as to facts and such disputed questions of fact are not to be gone into in these review petitions.” The relevant passages are reproduced here to reassure ourselves that the Hon'ble High court has left the question of possession of the documents with the 1^st opposite party open to be adjudicated before the appropriate authority, that question being a disputed fact. Hence, we think that jurisdiction to look into the matter as to whether the 1^st opposite party was in possession of the original documents pertaining to the vehicle, notwithstanding the dismissal of the review petition by the Hon'ble High Court.

9. If we go by the averment made by the 1st opposite party before the Hon'ble High Court stating that the vehicle was sold by them, one need not hesitate much to state that those documents were in their possession at the time of resale. They have no case that when the vehicle was repossessed, the documents were there in the vehicle. The endorsement made by the collection agent on the reverse side of Ext. A2 stating that the payment was made on the basis of assurance to hand over R.C. Book and permit in the custody of the 1^st opposite party in a short time cannot be simply overlooked as an unauthorised undertaking given by a collection agent made beyond the scope of his authority as claimed by DW1 in his deposition. As there is nothing on record to show that the agent has exceeded his limit of authority, we have to take it as a weighty price of evidence to indicate that the original documents were in the possession of the 1^st opposite party. There is no material produced before us to substantiate the resale and the price procured by such sale. Moreover, nothing is before us to show that the price procured was actually Rs. 2,10,000/- only. The 1^st opposite party has produced no documents to establish the above facts. DW1 while in the witness box could not reveal the name of the purchaser. Another important point deserving our attention is that the 1^st opposite party has overlooked the guidelines framed by the Reserve Bank governing the repossession of the vehicle on default of payment. They can seize the vehicle only after following due process of law. In the instant case, no proper notice has been issued to the defaulter. In this regard, the principle laid down by the Hon'ble Supreme Court in Manager, ICICI Bank Ltd. Vs. Praksh Kaur (2007 (1) KHC 894) governing recovery of loan and seizure of vehicle is noticeable. His Lordship held,

“The Bank should resort to procedure recognized by law to take possession of vehicles in cases where the borrower may have committed default in payment of the instalments instead of taking resort to strong arm tactics.”

In the present case, DW1 himself has admitted that no proper notice has been served and he claimed that notice was served over telephone which apparently fell short of the requisite procedure, even if it is taken on its face value. Another pertinent fact to be noted is that repossession was carried out, while O.S. 757/06 was pending before the Munsiff Court, as conceded by DW1 in his testimony before the Forum. The most curious thing is that as on 28-06-2006, the ownership of the vehicle was vested with complainant, according to Ext. A4 certificate issued by the Regional Transport Officer, Ernakulam showing that transfer of ownership was endorsed in the R.C. Book. The submission that the complainant filed suits to get himself relieved from his liability to pay instalments losses merit, when DW1 himself admits that the complainant even agreed to meet the expenses for getting duplicate of certificates provided N.O.C. was issued by the 1^st opposite party. This goes to show that he was in dire necessity of certificates to take the vehicle to public road. It is difficult to believe the deposition of DW1 that loan was sanctioned without verifying the original documents. In this background, we cannot disbelieve the submission of the complaint that the original documents were delivered by the owner of the vehicle to the 1^st opposite party in the presence of the complainant.

10. On an overall view of the matter, in the light of materials produced before us and the submissions made by both sides, we come to the conclusion that the 1^st opposite party has committed deficiency in service in furnishing originals of the vehicle to the complainant. This conduct of the 1^st opposite party has led to financial loss and mental agony to the complainant for which adequate recompense must be made by the 1^st opposite party. We do not find anything to indict other opposite parties in this case. But there is nothing before us to quantify the loss sustained by the complainant in terms of currency.

11. In the result, the complaint is allowed as follows :

1. The impugned vehicle loan stands closed and the accounts are settled accordingly.

2. The 1^st opposite party shall pay an a mount of Rs. 25,000/- towards compensation for mental agony.

3. The 1^st opposite party shall also pay Rs. 1,000/- towards costs of the proceedings.

The order shall be complied with, within a period of one month from the date of receipt of a copy of this order.

Pronounced in open Forum on this the 29^th day of July 2011