F.A.  517/2008  against C.C. 111/2007,  Dist. Forum, Eluru    

Between:

M/s. Sundaram Finance Ltd.

Rep. by its  Deputy General Manager

21, Patullos Road, Chennai

M/s. Sundaram Finance Ltd.

Rep. by its Branch Manager

Hanuman Junction Branch

Krishna Dist.                                              ***                           Appellants/

            OPs       

                                                                    And

Bhurmal Tarachand

S/o. Tarachand Serupaji

Nallamandu Street

Near Clock Tower

Eluru.                                                         ***                         Respondent/

Complainant

Counsel for the Appellants:                        M/s. Krishna L. Gahloth

Counsel for the Respondent:                       M/s. M. Rama Krishna.

CORAM:

HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT.

&

SMT.M.SHREESHA, LADY MEMBER.

THURSDAY, THIS THE TWENTY THIRD DAY OF SEPTEMBER TWO THOUSAND TEN

ORAL ORDER:  (Per Hon’ble Sri Justice D. Appa Rao, President.)

***

1)                This is an appeal preferred by the opposite parties against the order of the Dist. Forum  directing them to return the original papers relating to the Santro car, pay compensation and costs of Rs. 1,000/- each.  

2)                The case of the complainant in brief is that   he availed loan from the appellant finance company for purchase of Santro car.    At the time of granting loan the appellant had obtained 34 post dated cheques each for Rs. 8,160/- towards payment of monthly instalments.   He had discharged the entire loan on 17. 6. 2005.   Since then he has been requesting the appellant to return the original documents relating to the car and issue  ‘No Due Certificate’.    However, when his son had issued e-mail the appellant demanded the complainant to pay bank collection charges.    Since he had discharged the entire loan the appellant was unjustified in with-holding the documents and therefore prayed that they be directed to return the original documents together with compensation of Rs. 50,000/- towards mental agony and costs.

3)                 The appellant resisted the case.    While admitting that the complainant had discharged the loan however failed to pay Rs. 3,618/- towards outstation cheques collection charges.   The term instalment includes not only the instalment payable but also the cheque collection charges and this fact was informed through e-mail.   Though there was delay in getting instalments since instruments were outstation cheques they did not ask him  for payment of late remittance charges.   They cannot suffer both on delay in remitting the amounts and also lose bank charges.    The complaint was barred by limitation as it was filed after 2-1/2 years of sanction of loan amount.  In the light of arbitration clause the Dist. Forum has no jurisdiction.  Therefore it prayed for dismissal of the complaint with costs. 

4)                 The complainant in proof of his case filed his affidavit evidence and got Exs. A1 to A8 marked while the appellant filed the affidavit evidence of its Branch Manager and got Ex. B1 marked. 

5)                 The Dist. Forum after considering the evidence placed on record opined that the clauses in the agreement stipulate mode of payment of instalments and there was no whisper about the collection of bank charges.   Having received the entire loan amount  it could not have  with-held the documents and therefore directed the appellant  to return all the documents along with ‘No Due  Certificate’  and pay Rs. 1,000/- each towards compensation and costs. 

6)                 Aggrieved by the said order, the finance company preferred the appeal contending that the Dist. Forum did not appreciate the facts in correct perspective.    It ought to have seen that Clause 2.10 of the loan agreement clearly stipulates collecting  bank charges at Rs. 11/- per thousand for outstation cheques.    Till such payment they would not issue ‘No Due Certificate’.  More over the complaint was barred by limitation having filed 3-1/2 years after clearance of loan.    In the light of arbitration clause the Dist. Forum has no jurisdiction and therefore it prayed that the appeal be allowed.

7)                The point that arises for consideration is whether the order of the Dist. Forum is vitiated by mis-appreciation of fact or law?

8)                It is an undisputed fact that the complainant had discharged the entire loan amount borrowed for purchase of a car by depositing the papers relating to the ownership of the car.   When he sought for return of the said documents along with ‘No Due Certificate’ the appellant demanded an amount of Rs. 3,616/- to be paid towards collection charges for encashment of cheques issued by the complainant in discharge of the loan amount.    In the grounds of appeal  it had taken a contention  that  first schedule of  loan agreement in consonance with clause 2.10 gives  right to collect  bank charges   at Rs. 11/- per thousand  on outstation cheques  and till such payment  they cannot issue ‘No Due Certificate’  or return the documents.    Clause 2.10 relates to ‘Mode of payment of the instalments’.    Clause 2.10 (f) specifies that the charges mentioned in the first schedule of the agreement are subject to change at the sole discretion of the lender. 

9)                 The learned counsel for the appellants also relied  clause 2.5 under the head ‘Mode of Disbursement’ for claiming the amount.  It reads:   “The collection charges or such other charges levied, if any, in respect of  all such cheques  or modes of transfers will have to be borne  by the borrower  irrespective of  the time taken for transit/collection/realization of the cheque by the borrower or its bank.”     From this it is obvious  there is  stipulation for payment of collection charges for out-station cheques.  The charges comes  to Rs. 3,316/-.  Having paid Rs. 2,80,000/- we do not see why the complainant did not agree to pay this paltry amount of Rs. 3,316/-.    It is not as though the appellant for the first time was demanding this amount.    It had made clear through e-mail and also by way of reply.    Obviously the complainant having discharged the entire loan amount and having failed to collect the documents filed the complaint without perusing the clauses/conditions of the agreement.    Therefore, we are of the opinion that the complainant had to pay this amount in order to receive the documents. 

10)               The learned counsel for the appellants contended that the complaint was barred by limitation as it was more than 2-1/2 years after discharge of loan.    We may state herein that except payment of collection charges the entire amount was discharged.  Withholding the documents solely on the ground  of non-payment of  collection charges in fact as rightly pointed out by the Dist. Forum constitute  a continuing issue and no limitation can be urged against the remedy in this regard,  equally the contention that the Dist. Forum has no jurisdiction.    Evidently the payments were made at Eluru where the agreement was entered into and therefore it cannot be contended that the Dist. Forum has no jurisdiction.    As far as arbitration clause is concerned the Supreme Court in Thirumurugan Cooperative Agricultural Credit Society reported in (2004) 1 SCC 305 made it clear that despite clause of arbitration in the agreement the Dist. Forum is entitled to proceed with the adjudication.   

11)              The Dist. Forum had failed to consider the schedule wherein the complainant had agreed to pay collection charges and when he did not pay as agreed it cannot be said that there was deficiency in service on the part of appellants in not returning the documents.    This aspects needs modification.    The complainant himself  agreed  to pay said charges and the amount being paltry, we are of the opinion that in the interests of justice the complainant could be directed to pay the said amount to the appellant.    After receiving the same the appellant is directed to return the documents together with ‘No Due Certificate’.

12)              In the result the appeal is allowed in part and the order of the Dist. Forum in awarding compensation and costs is set-aside.  The complainant is directed to pay Rs. 3,316/- to the appellants within one month from the date of receipt of this order and on such payment the appellant is directed to return the documents along with ‘No Due Certificate’.  However, in the circumstances of the case each party to bear its own costs.  

1)       _______________________________

PRESIDENT                 

2)      ________________________________

 MEMBER          

   Dt.  23.  09.   2010.

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