IN THE CONSUMER DISPUTES REDRESSAL FORUM, PATHANAMTHITTA,
Dated this the 22nd day of November, 2011.
Present : Sri. Jacob Stephen (President).
Sri. N. Premkumar (Member)
C.C.No. 86/08 (Filed on 09.07.2008)
Between:
1. J. Thampi,
Grama Mandiram,
Mallappally West.P.O.,
Pathanamthitta District.
2. Susan Thampi,
-do. –do.
(By Adv. Anil Varghese) ….. Complainants
And:
1. Managing Director,
Integrated Finance Co. Ltd.,
P.B.No.4980,
Vairama 112, Thyagaraya Road,
T. Nagar, Chennai – 17.
2. Branch Manager,
Integrated Finance Co. Ltd.,
Baker Hill, Niravathu Building,
Middle Street, Kottayam – 1.
3. Branch Manager,
Integrated Finance Co. Ltd.,
Thollayiramkuzhiyil Building,
College Road, Kozhencherry. P.O.
(By Adv. K.M. Alexander)
4. Robin John. T,
Thoppil House,
Vadavathoor.P.O., Kottayam. ….. Opposite parties.
O R D E R
Sri. N. Premkumar (Member):
Complainant filed this complaint for getting a relief from the Forum.
2. Fact of the case in brief is as follows: Complainants are husband and wife. They deposited an amount of ` 2,00,000 each in 1st opposite party’s company as fixed deposit on 21.6.2000 vide FDOOKOT 00467 and 00468 for 5 years. The 1st opposite party is the Managing Director and 2nd and 3rd are Branch Managers and 4th one is the canvassing agent of the other opposite parties. The 1st complainant took a loan of `1,00,000 from the deposit No.467 on 7.2.2002. Both complainants deposits matured on 21.6.2005. Complainant received monthly interest regularly upto June 2005. The matured deposit receipts were surrendered to the 2nd opposite party for collection on 20.7.2005. They told that the same will be forward to 1st opposite party and the amount would be repaid soon. They also informed that receipt No.467 is also matured and that would be repaid after deducting the loan amount of ` 1 lakh taken by the 1st complainant.
3. However opposite parties failed to repay the matured amount. They informed that there occurred some financial crisis and the matter is pending before the Hon’ble High Court of Madras. The complainants are entitled to get the deposited amount with 14% interest from June 2005 onwards. Hence this complaint for getting ` 3 lakhs with 14% interest from June 2005 with compensation of ` 25,000 and cost.
4. Opposite parties 1 to 3 entered appearance and filed version. 4th opposite party is exparte. According to opposite parties 1 to 3 complaint is not maintainable either in law or on facts. According to them complainants are not consumers and hence complaint is not maintainable. The complainants have not hired any service for consideration from the opposite parties. The complaint is barred by limitation. The allegations that opposite parties withholding the deposit amount with interest is false and denied. The only option to complainant is to approach the appropriate civil court for proper remedy based on this allegations in the complaint.
5. According to them, 1st opposite party company has filed applications before the Hon’ble High Court of Madras for sanctioning a scheme of compromise or arrangement between the company and deposit holders and bond holders. Based on the said application High Court ordered a meeting of such deposit holders and bond holders on 10.8.2005. Accordingly, meeting conducted and the resolutions according consent to the said scheme was passed by the deposit holders with 3/4th majority. The resolutions were placed before the Madras High Court for orders sanctioning the scheme of compromise/arrangement. As per judgment and order dated 19.8.2006, the High Court allowed it. The said single Bench order of Hon’ble Madras High Court was set aside by the Division Bench on 30.4.2008. Against this 1st opposite party filed an appeal before the Hon’ble Supreme Court of India and is pending. Therefore this matter is subjudice.
6. The complainant’s are bound by the resolutions passed with 3/4th majority at the meeting of the deposit holders held on 10.8.2005. Therefore, complainants are estopped from now contending that amounts are payable by the opposite parties. Since the proceedings are pending before the Hon’ble Supreme Court of India, the remedies are barred as the complainants are bound by the said proceedings and the final outcome thereof. For this reason also, the complaint is not maintainable.
7. 1st opposite party filed an additional version on 29.10.2010 stating that they do not provide any services or goods. If it is construed that 1st opposite party has provided services of accepting deposit. It cannot be alleged the guilty of any deficiency of service due to mere non-payment of deposit. A mere deposit of monies in a non-banking financial company licensed by the Reserve Bank of India cannot be construed to the service. 1st opposite party is governed by the Companies Act and RBI Act. In order to tide over the difficulties faced by them, namely the financial crunch, they filed a petition before the Madras High Court under Section 391/394 of the Companies Act for the purposes extinguishing the liabilities through the Scheme by Conversion of the debt into equity. The complainant has no locus now to come before this Forum because the said scheme was finally approved by the Ld Single Judge of the Madras High Court and no objections were filed by the complainant nor appeal was filed against the said approval.
8. The Reserve Bank of India filed an appeal before the Hon’ble Division Bench of the Madras High Court challenging the jurisdiction of the High Court u/s.391/394 of the Companies Act by contending that the RBI Act is the exclusive Act applicable to such proceeding. In the meantime, the Company Law Board on the basis of order of Ld Single Judge of the Madras High Court on a complaint u/s.459A of the RBI Act passed the following directions.
“Taking into consideration that the Hon’ble High Court of Madras approved a scheme of Arrangement between the company and Bond holders/Deposit holders. I hereby direct the company to act in accordance with the order of the High Court of Madras. The deposit holders to contract the company either for repayment of deposits or to get convertible debentures in terms of the order of the High Court of Madras”.
9. According to them, once this direction is passed, it is applicable to all depositors and bond holders alike. Once the jurisdiction of the CLB had been exercised in favour of the bond holders/depositors a parallel jurisdiction is not maintainable with this Forum. The relief claim in the present case is not regarding deficiency of service and not providing adequate service to the complainant, but complaint is merely over non-payment of the dues which is directly and exclusively governed by RBI Act and the Companies Act under Sec. 391/394 of the Companies Act. Once an order has passed by the CLB the complainant has no locus to travel to this Forum and contend non-payment of the dues. First opposite party has been receiving consisting notices from the Reserve Bank of India to comply with the order of the CLB dated 15th November 2006. But due to setting aside of the scheme by the Division Bench of the Madras High Court, they are unable to comply with the orders of the Reserve Bank of India. But on the other hand, they are ready and willing to abide by the said orders for the reason that the scheme had been approved and sanctioned by the Ld. Single Judge of the Madras High Court. First opposite party is not in default because even they are ready and willing to apply the provisions of the scheme to the complainants and pay them through conversion of the dues into equity shares. Once the scheme was sanctioned by the Hon’ble High Court of Madras, the contract between the complainant and the opposite parties stood altered and innovated by operation of law under Sec. 392 of the Companies Act. In these circumstances, they canvassed for the dismissal of the complaint.
10. From the above pleadings, the following points are raised for consideration:
(1) Whether the complaint is maintainable before the Forum?
(2) Whether the reliefs sought for in the complaint are allowable?
(3) Relief and Cost?
11. Evidence of this complaint consists of the proof affidavit and documents and marked A1 to A4. Evidence of opposite parties consists of the oral deposition of DW1 and marked Exts. B1 to B6.
12. Point No.1: This point was considered in I.A. 168/2008 and found against opposite parties.
13. Point No.2 & 3:- In order to prove the complainant’s case, complainant filed proof affidavit along with certain documents. Complainant was examined as PW1 and the documents were marked as Exts.A1 to A4. Ext.A1 is the acknowledgment issued by opposite parties for the receipt of the fixed deposit certificate No. FDOOKOT 00467. Ext.A2 is the copy of fixed deposit No.0468 for an amount of ` 2,00,000 issued by opposite parties. Ext.A3 is the acknowledgment for receiving the original of Ext.A2 dated 20.7.05 issued by opposite parties. Ext.A4 is the reply notice dated 31.8.05 issued by opposite parties to 2nd complainant.
14. In order to prove opposite parties’ contention, power of attorney holder of opposite parties filed proof affidavit along with certain documents. Documents produced were marked as Exts.B1 to B6. Ext.B1 is the copy of the Madras High Court’s order dated 19.8.2008 sanctioning the scheme of compromise. Ext.B2 is the copy of the common judgment in the Hon’ble Kerala State Consumer Disputes Redressal Commission, Thiruvananthapuram dated 30.11.2006 in appeal No.92, 129, 131, 157 & 2003 of 2006. Ext.B3 is the copy of the order of Kerala Consumer Redressal Commission dated 30.3.06 in C.C.No.3/06. Ext.B4 is the copy of the power of attorney dated 14.3.08 by the Managing Director of the 1st opposite party appointing George Joseph as its attorney. Ext.B5 is the copy of the order dated 16.5.08 in SLP No.12737/2740/2008 of the Hon’ble Supreme Court of India. Ext.B6 is the copy of the order dated 15.11.2006 in the Company Law Board, Chennai.
15. On the basis of the contentions and averments of the parties, we have perused the entire materials on record. Complainant’s case is that opposite parties did not pay back the matured deposited amount with interest even though they approached several times. Opposite parties contention is that the Hon’ble High Court of Madras ordered a meeting of deposit holders and bond holders and accordingly a scheme was passed with a majority. As per the scheme, the deposit holders have to contact the company either for repayment of deposit or to get convertible debentures. The said order was set aside by the Hon’ble Division Bench, High Court of Madras. Now the matter is pending before the Hon’ble Supreme Court of India. According to opposite parties once the scheme was sanctioned by the Hon’ble High Court of Madras, the contract between the complainant and the opposite parties stood altered and innovated by the operation of law u/s. 392 of the Companies Act.
16. It is not disputed that complainants have not deposited in 1st opposite party’s company. Ext.A1 to A3 shows that complainant’s fixed deposit was matured and the same were surrendered for getting the amount. Ext.A4 shows that they informed the complainants to wait for getting the order from Hon’ble High Court of Madras for approval of the scheme. Materials on record show that Division Bench of Hon’ble Madras High Court set aside the order of the single bench. On a perusal of Ext.B1 and B5, it is learned that the dispute has not been settled and is pending before the Hon’ble Supreme Court of India. Complainants had filed this case for non-payment of matured fixed deposit amount alleging deficiency of service. The case pending before the Hon’ble Supreme Court of India is not related to the said subject matter. Evidence on record does not reveal that complainants would not restrain to approach this Forum for appropriate remedy. Hence we are of the view that there is no order or stay preventing this Forum from entertaining this matter.
17. From the overall facts and circumstances and the available evidence on record, it is seen that complainants deposited an amount of `2,00,000 each for five years as fixed deposit to 1st opposite party company. The 1st complainant availed a loan of ` 1,00,000 by pledging one F.D. But opposite parties failed to return the amount due to the complainants with assured interest even after its maturity. It is unjust, unfair, malafide and against all the cannons of consumer justice. It is not only a breach of contract but also a clear deficiency of service. Therefore, we find that his complaint is allowable with deposited amount with assured interest and cost. Since interest is allowed, no separate compensation is allowable. It is seen that 4th opposite party is only a canvassing agent. So he is found not liable to the complainants.
18. In the result, complaint is allowed, thereby opposite parties 1 to 3 are directed to return the fixed deposit amounts due to the complainants vide Ext. A1 acknowledgment receipt and Ext. A2 fixed deposit receipt along with its assured interest from June 2005 till this date along with cost of ` 2,000 (Rupees Two Thousand only), less the amount due from the 1st complainant for the loan availed by him from the opposite parties within 15 days from the date of receipt of this order, failing which the complainants are allowed to realize the whole amount due to them along with 10% interest from today till the whole realization.
Declared in the Open Forum on this the 22nd day of November, 2011.
(Sd/-)
N. Premkumar,
(Member)
Sri. Jacob Stephen (President) : (Sd/-)
Appendix:
Witness examined on the side of the complainant: Nil.
Exhibits marked on the side of the complainant:
A1 : Acknowledgment dated 07.02.2002 issued by opposite parties
for the receipt of the fixed deposit certificate No. FDOOKOT
00467 dated 21.06.2000.
A2 : Copy of fixed deposit receipt No.0172206 dated 21.06.2000 for
an amount of ` 2,00,000 issued by opposite parties.
A3 : Acknowledgment issued by opposite parties for the receipt of
the fixed deposit certificate No. FDOOKOT 00468 dated
21.06.2000 for ` 2 lakhs.
A4 : Reply notice dated 31.8.05 issued by opposite parties to 2nd
complainant.
Witness examined on the side of the opposite parties:
DW1 : George Joseph
Exhibits marked on the side of the opposite parties:
B1 : Copy of the Power of Attorney dated 14.03.2008 executed by
the first opposite party in favour of George Joseph.
B2 : Copy of the judgment dated 19.08.2006 in Company Petition
No. 160/2005 sanctioning the Scheme of Compromise/
Arrangement.
B3 : Copy of the Common Judgment dated 30.11.2006 in Appeal
Nos. 92, 129, 131, 157 & 203 of 2006 of the CDRC,
Thiruvananthapuram.
B4 : Copy of the order of the CDRC dated 30.03.2006 in C.C. No.
3/2006.
B5 : Copy of the order dated 16.05.2008 in SLP No.s 12737-
12740/2008 of the Supreme Court of India.
B6 : Copy of the order dated 15.11.2008 of the Company Law Board,
Chennai.
(By Order)
(Sd/-)
Senior Superintendent.
Copy to:- (1) J. Thampi, Grama Mandiram, Mallappally West.P.O.,
Pathanamthitta District.
(2) Managing Director, Integrated Finance Co. Ltd., P.B.No.4980,
Vairama 112, Thyagaraya Road, T. Nagar, Chennai – 17.
(3) Branch Manager, Integrated Finance Co. Ltd.,
Baker Hill, Niravathu Building, Middle Street, Kottayam – 1.
(4) Branch Manager, Integrated Finance Co. Ltd.,
Thollayiramkuzhiyil Building, College Road, Kozhencherry.
(5) Robin John. T, Thoppil House, Vadavathoor.P.O., Kottayam.
(6) The Stock File.
