MR BIBEKANANDA DAS, MEMBER:-
Complainant has filed the C.C.Case No. 51/2024 U/s-35 of C.P.Act, 2019 seeking the following relief:
“Hon’ble Commission may direct the Ops & issue notice to the Ops calling upon to file show cause regarding seizure of vehicle bearing Regd. No. OD-02BJ-8496(Tata ACE) and vehicle be released in favour of the Complainant and pay compensation”.
The brief fact of the case is that, the Complainant challenge the illegal action of Op No.1 for illegal seizure of the vehicle due to defaulted EMIs of Rs. 1,91,000/- which was seized on dt. 05.12.2023 without prior notice and it amounts to gross deficiency in service and unfair trade practice and which is against the observation of the Hon’ble Apex Court. It is further submitted by the Complainant that he was ready and willing to pay the installments but the Op No.1 refused to accept and not released the vehicle and the Complainant apprehend that the vehicle may sold to some other person for which he will sustain heavy financial loss and due to such reason he approached this Commission for redressal of his grievances.
The Op No.1 on the other hand submitted that, the Complainant doesn’t fall within the purview of consumer as mentioned U/s-2(7) of C.P.Act, 2019 for which the case is not maintainable and liable to be dismissed. The Op No.1 also stated in their written version that, the Complainant never responded to the notices of Arbitration proceeding and has suppressed many facts and the Complainant has been filed just to evade the payment of contractual dues. Further the Op No.1 submitted that since the Arbitrator award has been passed by the Sole arbitrator prior to filing of this C.C.Case and the vehicle has been repossessed and sold in compliance of the award dt. 29.04.2023, the Op No.1 is not liable to pay any compensation and there is no deficiency in service and unfair trade practice committed by Op No.1 and since the award of the Arbitration proceeding attained finality, this Commission has no jurisdiction to entertain the C.C.Case.
Heard the Ld. Counsels for both the parties and perused the documents available on record and also gone through the written version and citations filed by Op No.1 and the Complainant.
From the above facts and circumstances and after a careful scrutiny it is our considered view that, it is not disputed that the Complainant has availed loan from Op No.1 and as against such loan the complainant was paying interest which is consideration and as such the Complainant is a consumer as per observation of the Hon’ble Supreme Court reported in 1995(2) SCC-150-SC (Consumer Unit and Trust Society vrs Chairman-MD, Bank of Baraoda).
The contention raised by the Op No.1 that as per agreement the dispute shall be adjudicated by the Arbitrator but not by this Commission is not sustainable in view of the Hon’ble Supreme Court reported in 2004 CTJ (1) SC wherein it was held that, “ Arbitration clause has no bar for entertaining the dispute by the Consumer Fora”. Further the Op No.1 has not adduced any evidence regarding sending of pre-repossession notice and pre-sale notice to the Complainant nor has filed any postal receipt, copy of loan agreement to that effect and so also the Op No.1 has not complied the order dt. 23.07.2024 of this Commission, for proper adjudication of the dispute. That apart appointment of Arbitrator at Mumbai on basis of Arbitration clause is void-ab-initio. The Arbitration proceeding and the unilateral award passed by the Sole Arbitrator is null and void in the eye of law and as such the award is liable to be set-aside in view of decision of the Apex Court. The Arbitrator award is passed ex-parte by the Sole Arbitrator and the Sole Arbitrator could not have been unilaterally appointed by the Op as per the settle legal position. We do not find a single scrap of paper which will support the Op such as pre-sale and pre-repossession notice, Postal receipt etc. and in absence of any documentary evidence from the side of Op No.1 and as per the Arbitration award passed at Mumbai violating the guidelines of the Apex Court, we have no hesitation to decide the present dispute in favour of the Complainant.
In our opinion, no public notice having been given by the Op in new paper before selling the vehicle repossessed from the Complainant and it can’t be said that the vehicle was sold by following a fare and transparent process. This was not only another act of deficiency in service on part of the Op in rendering service to the Complainant but also a patent Unfair Trade Practice as has been defined in the C.P.Act, 2019. Moreover, it is quite interesting that Op No.1 sold/auctioned the vehicle on dt. 27.12.2023 and on the very same day issued a letter to the Complainant regarding settlement offer of loan A/C by fixing dt. 28.12.2023 for depositing the outstanding amount of Rs. 1,91,400/- and accordingly the Complainant deposited the above said amount on dt. 29.12.2023 and the Op No.1 acknowledged the same vide receipt No. 305235032(copy annexed). This fact was clearly stated by Op No.1 in its written version. This clearly show that the Op No.1 has committed deficiency in service and adopted Unfair Trade Practice by selling the vehicle of the Complainant by keeping him in the dark by suppressing the said fact.
In this context we are inclined to hold that the Op No.1 is empowered as per terms and conditions of the agreement to seize and sale the financed vehicle in case of defaulted monthly installments of the loan but such seizure and sale must be as per law in view of the observation of Hon’ble National Commission reported in 2016(2) CLT-31-NC and Hon’ble Supreme Court reported in 2007(36) OCRCS wherein it was held that, “ vehicle repossess and sold by Financer without notice is illegal. So the Op No.1 took the action violating the guideline of Apex Court.
In view of the settled legal position that, ex-parte award passed by the Sole Arbitrator is vitiated as no party can be permitted to appoint unilaterally an Arbitrator as the same would defeat the purpose of unbiased adjudication of dispute between the parties in view of the pertinent observation of the Hon’ble Supreme Court in case of Perkins Eastern Architects DPC (Supra). The person who has an interest in the outcome or decision of the dispute must not have power to appoint a Sole Arbitrator, and the outcome thereof is ineligible not only to act as an arbitrator but also is rendered ineligible to appoint anyone else as an Arbitrator which is contrary to the decision of the Apex Court in context of Sec-12(5) of the Act read with Seventh schedule thereof.
In view of the above observation, it is our considered view that the Op No.1 has committed gross negligence and patent deficiency in service as well as adopted Unfair Trade Practice by seizing the vehicle of the Complainant and without following proper procedure of law, sold/auctioned the seized vehicle for which the Complainant sustained heavy financial loss and undergone mental agony and harassment during these period which can’t be compensated in any manner.
O R D E R
We therefore direct the Op No.1 to refund the deposited amount of Rs. 1,91,400/- alongwith @10% P.A. from the date of sale i.e dt. 27.12.2023 till the date of payment to the Complainant and also directed to pay Rs. 50,000/- towards compensation for mental agony and harassment undergone by the Complainant and shall also pay Rs. 10,000/- for cost of this litigation within a period of 45 days from the date of receipt of this order, failing which the Op No.1 shall be liable for execution proceeding under the C.P.Act. 2019.
With the aforesaid direction and observation the C.C.Case No. 51/2024 is allowed & accordingly disposed off. No order as to cost.
Issue extract of the order to the parties for compliance.
Pronounced in the open Commission, on this the 24th day of September, 2024.
I, agree,
SD/- SD/-
PRESIDENT (I/C) MEMBER
