Sri Utpal Kumar Bhattacharya, Member
This is an Appeal u/s 15 of the CP Act, 1986 preferred by the Appellant/OP No. 1 targeting the judgment and order dated 02.05.2013 passed by the Ld. District Forum, Uttar Dinajpur at Raigunge in Complaint case No. 31/2012 allowing the same against the Appellant/OP with the directions as under.
- Not to claim the amounts shown as outstanding as per demand notices dated 24.04.2012 and 25.04.2012 from the Respondent/Complainant.
- Not to repossess the subject vehicle of the Respondent/Complainant.
- To issue NOC/Loan Clearance Certificate to the Respondent/Complainant.
- To pay to the Respondent/Complainant a litigation cost and compensation for harassment to the tunes of Rs. 1,000/- and Rs/- 5,000/- respectively.
- To carry out the entire directions as above within one month from the date of the impugned judgment and order.
The facts, in brief, as emerged out of the records, were that the Appellant/OP No. 1 through its agents, the Respondent/OP Nos. 2 and 3, advanced to the Respondent/Complainant against his prayer a loan for an amount of Rs. 2,41,000/- for purchasing a Tata Indica DL Vehicle for his personal use. Repayment of the said loan amount together with interest and documentation charges for an amount of Rs. 63,046/-, total amount being Rs. 3,04,046/-, was scheduled to be made by the Respondent/Complainant in 36 instalments at an EMI of Rs. 8446/-.
The Respondent/Complainant allegedly had paid the entire amount repayable but to his utter surprise, received two demand notices dated 24.04.2012 and 25.04.2012. In the latter notice, an amount of Rs. 35,683.36/- was shown as outstanding dues in respect of the said loan which the Respondent/Complainant was asked to pay.
In an apprehension that the Appellant/OP might resort to step for repossessing the vehicle, the Respondent/Complainant filed the Complaint case before the Ld. District Forum. The impugned judgment and order which is under challenge in the instant Appeal originated from the said Complaint Case.
The Appeal was heard ex-parte against the Respondent/Complainant.
Ld. Advocate appearing on behalf of the Appellant/OP drew the notice of the Bench at para Nos. 2 and 3 of the impugned judgment and order at running page 16 and submitted that the names of the Respondent/OP Nos. 2 and 3 were expunged from the complaint by the lower Forum and the Appellant/OP No. 1 was not given any chance to submit as the case was finally disposed of in an ex-parte hearing against his client.
As contended, the notice of hearing was never served upon the Appellant/OP No. 1 and the record was devoid of any documentary evidence corroborating the claim of good service of notice upon the Appellant/OP No. 1.
Drawing notice of the Bench to para No. 9 of the Complaint petition, the Ld. Advocate submitted that the full payment of loan with interest as claimed by the Respondent/Complainant in the said para was farthest from the truth as there was an outstanding dues against the said loan of Rs. 35,683.36/-. The demand notices, admittedly, were issued for payment of the outstanding dues which were not responded to by the Respondent/Complainant.
The Appellant/OP No. 1, therefore, had no alternative but to refer the matter to Arbitration in terms of the provision laid down at para 23 of the terms of Agreement, running page 28.
As submitted, the first notice of the Arbitration Case was issued on 07/05/2012 which was prior to 07/06/2012, the date of filing the Complaint Case. Further, as the Ld. Advocate continued, the Arbitration Case was finally disposed of being decided in its favour and an award was passed under order dated 13.07.2012 which is long before the date of passing the impugned judgment and order.
Since, as continued, the Arbitration award was already passed, the Ld. District Forum should not have passed the impugned judgment and order. The matter, as continued further, was brought to the notice of the Ld. District Forum which did not take cognizance of the same issue and passed the impugned judgment and order without application of mind.
The Ld. Advocate, in support of his above submission, preferred to cite a decision of Hon’ble National Commission in Revision Petition No. 3835 of 2013 from the order dated 18.09.2013 in FA No. 511/2013 of Haryana State Consumer Disputes Redressal Commission, reported in II (2016) CPJ 231 (NC) wherein the Hon’ble National Commission was critical about the Ld. District Forum’s wrong exercising of power not vested in it while passing an order in a case already decided through Arbitration.
Perused the papers on record. Considered submission of the Ld. Advocate appearing on behalf of the Appellant/OP No. 1.
The case record revealed that an award was passed by the Ld. Arbitrator deciding the Arbitration ex-parte against the instant Respondent/Complainant. As stated, the ex-parte hearing was ordered due to the Respondent/Complainant’s absenting himself on two successive dates of hearing in spite of notices of hearing having served upon the Respondent/Complainant on both the occasions properly.
It revealed from the award of Arbitration that the Respondent/Complainant herein was intimated in the second notice about holding the hearing ex-parte against him in case of his absence for the second time. The crux of the issue is whether the notices of hearing in the name of the Respondent/Complainant, stated to have been issued, were at all served.
In the instant complaint, the point of dispute remained undecided with Respondent/Complainant claiming full repayment made by him as per schedule when the Appellant/OP refuting the said claim. In the given circumstances the onus of proving the Respondent/Complainant’s becoming defaulter due to the alleged non-repayment consequent upon the OP’s claim of full repayment, devolved fully upon the Appellant/OP.
The record did not reveal any statement furnished by the Appellant/OP in respect of the subject loan account falsifying the claim for full repayment of loan by the Respondent/Complainant.
The Appellant/OP, knowing it well that the documents corroborating service of notices of hearing upon the Respondent/Complainant and the same showing caution of ex-parte hearing against the Respondent/Complainant in case of non-attendance on the dates fixed for hearing were the vital documents to confirm transparency in the process adopted in Arbitration, did not care for producing neither of the said documents with the Appeal generating doubt as to the veracity of servicing of notices as claimed.
In this connection, it is worthwhile to mention here that Article 25 of the UNICITRAL Model Law is incorporated in Section 25. In Russel on Arbitration, 20th edition at page 63, it is stated as follows:
“In general, an arbitrator is not justified in proceeding ex-parte without giving the party absenting himself due notice.
It is advisable to give the notice in writing to each of the parties of their solicitors. It should express the arbitrator’s intention clearly, otherwise the award may be set aside.”
Above principle was adopted by Hon’ble Calcutta High Court in Juggilal Kamlapat-vs-General Fibre Dealers Ltd. AIR 1955 Calcutta 354(DB), wherein the Hon’ble Court was pleased to hold that if a party failed to attend the Arbitration hearing on the due date and time, the arbitrator should be at liberty to proceed ex-parte, though it was advisable, but not compulsory, that he should give that party notice of his intention to proceed ex-parte. On the instant occasion, the record was marked by conspicuous absence of any evidence towards servicing of notices of hearing, let alone the caution notice of ex-parte hearing in default.
We are afraid, in absence of a definite proof towards service of notices, we are not inclined to hold that the Arbitration order had due tenability for acceptance.
Therefore, keeping an eye on the “principle of natural justice”, we are inclined to hold that the Ld. District Forum has committed no wrong in passing the impugned judgment and order and, accordingly, the judgment and order does not deserve any intervention from this Commission.
Hence,
Ordered
that the Appeal be and the same stands dismissed. Impugned judgment and order stands affirmed. No order as to costs.
