Tamil Nadu

South Chennai

CC/43/2022

Agish Anandan - Complainant(s)

Versus

M/s. L & T Financial Service - Opp.Party(s)

R. Chittibabu

11 Apr 2023

ORDER

  Date of Complaint Filed:20.12.2021

  Date of Reservation     :28.03.2023

  Date of Order             : 11.04.2023

 

          DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION,

CHENNAI (SOUTH), CHENNAI-3.

 

PRESENT: TMT. B. JIJAA, M.L.,                                           : PRESIDENT

                    THIRU. T.R. SIVAKUMHAR, B.A., B.L.,           :  MEMBER  I 

                    THIRU. S. NANDAGOPALAN., B.Sc., MBA.,    : MEMBER II

               

CONSUMER COMPLAINT No.43/2022

 TUESDAY,THE 11^th DAY OF APRIL 2023

 

Agish Anandan,

Son of Anandan,

1-10, Raja Street,

Devaraj Nagar, Saligramam,

Chennai - 600 093.                                                         .. Complainant.

-Vs-

M/S. L&T Financial Service,

Represented by its The Branch Manager,

28, Ethiraj Salai, Egmore,

Chennai - 600 008.                                                       .. Opposite Party.

* * * * *

 

Counsel for the Complainant     : M/s. R. Chittibabu, Ilayarani Ponraj

 

Counsel for Opposite Party        : M/s. V. Balasubramani, V. Vadivelan

 

On perusal of records and upon hearing the oral arguments of the counsel for Complainant and the counsel for the Opposite Party this Commission delivered the following:

ORDER

Pronounced by Member-I, Thiru. T.R. Sivakumhar., B.A., B.L.,

(i) The Complainant has filed this complaint as against the Opposite Party under section 35 of the Consumer Protection Act, 2019 and prays to refund a sum of Rs.57,975/- received from Complainant along with interest @9% p.a from the date of repossession of the vehicle i.e., 14.08.2021 till its realization and to pay a sum of Rs.5,00,000/- as compensation for mental agony and harassment as well as cost of proceedings for their deficiency in service, unfair trade practice and negligence.

I.  The averments of Complaint in brief are as follows:-

1.     The Complainant had purchased a two wheeler vehicle of Honda Dio make bearing No.TN 09 CS4556 on 17.05.2019 for an amount of Rs.98,130/- including the cost of accessories. In order to meet the cost of the purchase of the vehicle, the Complainant took loan of Rs.76,527/- from the Opposite Party under the loan agreement on 17.05.2019 which was to be repaid in 30 installments of Rs.2883/- per month. The Opposite Party received 3 blank cheques from the Complainant for loan purpose.  He had repaid 10 installments regularly to the Opposite Party through ECS mode and 6 instalment online payment hereunder mentioned as follows;

ECS PAYMENT BREAKS UP DETAILS

ECS pay period	Details	Year	Month	Per month amount	Sub Total
	ECS Credit repayment from bank	2019	6 Months	2883	17298
	ECS Credit repayment from bak	2020	4 months	2883	11,532
05.03.2021 11.03.2021 15.04.2021 18.07.2021	Online payment	2021		5766 2883 2883 6000	17,532
Total Amount         46,362

 

but thereafter the Complainant could not deposit remaining installment due to Corana Virus Covid-19 spread and also moratorium period in force. Although the Complainant contacted the Opposite Party to explain the circumstances in which default in payment of 2 installments had taken place and also assured the Opposite Party that he would deposit said amount within 1-2 months. While facts being so, he parked his vehicle on 14.08.2021 in the front of Cinema Production Office situated at Door No.141, Rudhra Illam, Sri Lakshmi Nagar 2 Main Road, 1st Street, Valasaravakkam, Chennai around 12.30 p.m. and on returning from said production office around 2.00 p.m. he found that the vehicle was missing. Then immediately he lodged complaint on 14.08.2021 with the inspector of police, R-9, Valasaravakkam Police Station, Chennai, but the police did not register the case against the Opposite Party and simply treated it as a petition assigning a CSR. Thereafter he came to know through SMS message on 17.08.2021 that Opposite Party resorted to forcibly snatch the vehicle on 14.08.2021 through its musclemen. Since the police did not registered case, the Complainant approached the deputy commissioner of police, Chennai but it was no use and thereafter he approached Court of Judicial Magistrate-I, Poonamallee, filed a petition for a direction under section 156 (3) Cr.P.C. But the learned Judicial Magistrate did not refer the petition to police authority for registration of the case and investigation of the matter as desired by the Complainant and learned Judicial Magistrate dismissed the petition on 19.11.2021 by findings that seizure of vehicle which is purely civil dispute. The incident has been recorded on by CCTV Camera under the control of the inspector of police, R-9, Valasaravakkam Police Station, Chennai. He had sent a representation dated 17.08.2021 to Opposite Party for return of the vehicle from the receipt of representation and the Opposite Party having received, did not come forward for return of vehicle. In the view of complaint made by him to banking ombudsmen, the- Opposite Party sent a letter dated 11.11.2021 through e-mail and from recital of the letter, he came to know that the Opposite Party has repossessed vehicle in the terms of loan agreement and that vehicle has been sold and that Rs.1,545.72/- has to be paid by him as a loss. The act of repossession of the vehicle of the Complainant by Opposite Party through musclemen is illegal and deficiency in service. The vehicle was repossessed by Opposite Party legally without intervention of the appropriate Civil Court or arbitration proceedings amount to unfair trade practice. The loan for the purchase of the vehicle, default in the repayment and seizure of the vehicle by use of force can be done only through legal means, cannot employ goondas for repossession of the vehicle by force. The vehicle financed, seized and auctioned without intimation to the Complainant is illegal and unjust. Non-declaration of the NPA is said to be unfair trade practice. No demand notice for repayment of the loan and no notice of sale with regard to vehicle were given by the Opposite Party to the Complainant and fabricating forged documents in the respect of sale of vehicle is amount to unfair trade practice. The act of Opposite Party after auction of the vehicle by demanding the Complainant to pay Rs.1,545.72/- as a loss is unlawful and amount to unfair trade practice. The Opposite Party ought to have adopt procedure established by law with regard to repossession of the vehicle and sale of vehicle. The Opposite Party committed breach of contract in the respect of loan agreement entered between Opposite Party and Complainant through repossession of the vehicle by force amount to negligence. The Opposite Party resorted to forcibly snatch the vehicle and sold the same by fabricating forged document as signed by the Complainant without following due process of law and committed act of unfair trade practice, deficiency in service and negligence. The Complainant is being aggrieved by acts of Opposite Party and suffered mental agony and harassment. Hence the complaint.

II.   Written Version filed by the  Opposite Party in Brief is as follows:

 

2.    During the course of their business the Complainant herein had approached the Opposite Party for availing a loan for purchase of two wheeler and for that purpose the said Complainant represented himself financially sound enough to pay the dues regularly and have capacity to repay EMIs on documents in support thereof. Pursuant to such request, the Opposite Party sanctioned loan to a sum of 79,894.68/- vide loan agreement No.T18442170519054804 for the purpose of purchase of two-wheeler in the said agreement. Further the amount were duly disbursed and as per the terms and conditions contained Complainant agreed to repay the said loan in 30 equal monthly installments of Rs.2883/- each starting from 03.07.2019 to 03.08.2022. On contrary to the said contractual agreement the Complaint failed to repay the EMIS on time and started committing default right from the inception. Despite several request, and reminders the Complainant has not paid the dues and hence with no other option, as per the contractual agreement the Opposite Party have every right to repossess the hypothecated vehicle in case of default. The Complainant is liable to pay an overdue of more than Rs. 59,027/- and on 16.08.2021 the Opposite Party had repossessed the vehicle and pre sale notice was sent through SMS to the Complainant's registered mobile Number on 17.08.2021 and despite of receipt of the said pre-sale notice and having 9 days clear notice the Complainant neither replied nor paid the dues. Hence, the vehicle was auctioned on 26.08.2021. The vehicle was sold to the person quoted the highest bid on Car Dekho site. The Complainant was irregular in repayment of the EMIs on time, which is the essential criteria of the loan agreement and also committed gross breach / default in due performance and observance of the terms and conditions contained in the said agreement. Further the Opposite Party had sent a demand notice on 16.02.2021 and 08.04.2021 requesting for payment dues but there were no responses from the Complainant. The Complainant was not in contactable and had shifted from the contractual address and no response even from his mobile number. As per the agreed contractual agreement, the Opposite Party have every right to reposess the vehicle on default and accordingly the Opposite Party had repossessed the vehicle on 16.08.2021 and pre sale notice was sent through SMS to the Complainant's registered mobile Number and despite of receipt of the said pre-sale notice, the Complainant neither replied nor paid the dues and as such the Respondent had sold the vehicle by auction. The Complainant had lodged complaint before the Inspector of Police, R-9, Valasarvakkam Police Station, Chennai against the Opposite Party for repossess of the vehicle and on enquiry conducted by the Inspector of Police, R-9, Valasarvakkam Police Station they found the dispute is based on contractual agreement and is in civil nature and as such closed the complaint. After auction of the vehicle, the Complainant herein had raised a false and baseless complaint before the Ombudsman on 20.10.2021. The Opposite Party has duly replied to the issues / queries raised by the Ombudsman from time to time. Subsequently order was passed by the Ombudsman directing the Company to pay the compensation of Rs.10,000/- to the Complainant and according the Complainant had credited an amount of Rs.10,000/- to the Complainant's Account on 05.01.2022. As the issue of the customer is of civil nature and there is no criminal aspect and the same has already been taken care of criminal complaint filed by the Complainant before the Hon'ble Judicial Magistrate I, Poonamallee with malafide intention in order to unnecessarily the Opposite Party, however the Hon'ble Judicial Magistrate I, Poonamallee rightly observed the nature of case and had dismissed the same and against the said dismissal order the Complainant had preferred Criminal Revision Petition No. 1105/2021 and the same is pending.  The vehicle has been repossessed by the Opposite Party on the basis of agreed contractual agreement, hence there is no undue trade practice as alleged by the Complainant herein. There is no cause of action as against the Opposite Party and as such the complaint is liable to be dismissed with exemplary costs. Being the Non-Banking Financial Company (NBFC), they have a fiduciary responsibility with respect to public money (our borrowings) and hence the Opposite Party has every right to recover the monies lent to our borrowers. A bad credit behavior such as in this case, should not be incentivized by compensating the borrower, as this may set a wrong precedent of rewarding the defaulter. This will have a two-way negative impact on the NBFCs as the Opposite Party will not get back our funds and will have to compensate delinquent borrowers with the funds raised from the Public. The averments raised by Complainant are false, flimsy, devoid of merits. Hence prayed to dismiss the complaint.

III. The Complainant has filed his proof affidavit and Written Arguments,  in support of his claim in the complaint and has filed documents which are marked as Ex.A-1 to A-11. The Opposite Party has filed its Proof Affidavit and Written Arguments. On the side of Opposite Party documents were marked as Ex.B-1 to Ex.B-9.

IV. Points for Consideration:-

 

1. Whether there is deficiency in service on the part of the Opposite Party?

2. Whether the Complainant is entitled for reliefs claimed?

3. To what other reliefs the Complainant is entitled to?

POINT NO. 1 :-

3.     It is an undisputed fact that the Complainant had purchased a two wheeler Honda Dio on 17.05.2019 bearing Registration No. TN 09 CS 4556 for a sum of Rs.98,130/-, by availing loan for a sum of Rs.76,527/- from the Opposite Party under Loan agreement dated 17.05.2019, repayable in 30 monthly instalments at Rs.2883/- per month.

4.     The disputed facts of the Complainant are that though he had paid a sum of Rs.46,362/- till 18.07.2021 towards monthly instalments to the Opposite Party under the said loan agreement and thereafter he was not able to pay the instalments due to Covid-19 and moratorium period in force and he had assured to pay the dues within 1 to 2 months. On 14.08.2021 when his vehicle was parked around 12.30 pm in the front of a cinema production office at Valasaravakkam and on his return around 2 pm from the production office his vehicle was found missing and he had immediately lodged a complaint before R-9 Valasaravakkam Police Station and his complaint was not registered and the same was treated as a petition by assigning a CSR. By SMS message sent by the Opposite Party on 17.08.2021 he come to know that the Opposite Party had resorted forcible possession of his vehicle. He had also approached the Deputy Commissioner of police, as his complaint was not registered at Concerned Police Station, was not responded, he had filed a private complaint against the Opposite Party under Section 156(3) of Cr.P.C. which was also got dismissed. He had sent a representation on 17.08.2021 to return back his vehicle, in spite of receipt of the same, the Opposite Party had not returned his vehicle. Thereafter he had approached the banking ombudsman and from the Letter dated 11.11.2021 sent by the Opposite Party he came to know that the Opposite Party has repossessed his vehicle and sold the vehicle and a sum of Rs.1,545.72p was payable by him. Further no demand notice was given to him for repayment of the loan or with regard to the sale of his vehicle after the illegal repossession made, rather had demanded a sum of Rs.1545.72p to be paid by him, was unlawful. Thus the Opposite Party had illegally repossessed his vehicle though musclemen, without adopting the procedure established under and without following the law amounts to deficiency of service and without declaring his loan account as non performing assest and illegally taken possession and sold the vehicle without giving any intimation to him as per law amounts to unfair trade practice.

5.     The Complainant had relied upon a Judgement passed in M/s.Sundaram Finance Ltd Vs. Sh. Atul Kumar on 05.11.2014 by the Hon’ble National Consumer Disputes Redressal Commission, wherein the Judgement of the Hon’ble Supreme Court passed in Manager ICICI Bank Ltd Vs. Prakash aur & Ors. has been referred, in which the Hon’ble Supreme Court had held that default in repayment-seizure of vehicle by use of force-recovery of vehicle or seizure of vehicles could be done only through Legal means – banks cannot employ goondas to take possession by force. And also referred other Judgements, in all it was held that seizure of vehicles can only be done through legal means and not by musclemen. Finally, the Hon’ble National Consumer Disutes Redressal Commission had upheld the findings of the District Forum and State Commission. 

6.     The Contentions of the Opposite Party are that the Complainant has to pay a overdue amount of Rs.59,027/- and on 16.08.2021 they had repossessed the vehicle and pre-sale notice was sent through SMS to his registered mobile number on 17.08.2021 giving 9 clear days, he had neither replied nor paid the dues and hence his vehicle was sold on 26.08.2021. As the Complainant was irregular in paying the instalments in time violating of the terms and conditions of the Loan agreement, they had sent demand notice on 16.02.2021 and on 08.04.2021 and requested him to pay the dues but there was no response from him. Further the Complainant could not be contacted as he had shifted from the contractual address and no response even from his mobile number. As per the Loan Agreement they have every right to repossess the vehicle on default and exercising their right they had repossessed Complainant’s vehicle on 16.08.2021. Further contended that the Complainant had lodged a complaint before Valasaravakkam Police Station against the repossession made by them and on enquiry the dispute was found to be in civil nature, his said complaint was closed. After the auction sale of his vehicle, he had approached the banking ombudsman on 20.10.2021 and they had sent a reply to the issues/ queries raised by the ombudsman from time to time. And they had credited the compensation amount of Rs.10,000/- to the account of the Complainant, as ordered by the Ombudsman. The Criminal complaint filed by the Complainant under Sec.156(3) Cr.P.C was rightly observed and dismissed by the Hon’ble Judicial Magistrate- I, Poonamallee, against which a Criminal Revision Petition No.1105 of 2021 was filed and pending. There was no cause of action against them and there was no undue trade practice  and deficiency of service as alleged by the Complainant.

7.     On discussions made above and on perusal of records, it is clear that the Complainant had made payments till 18.07.2021 which was not denied by the Opposite Party as well as the Opposite Party had not denied the contention of the Complainant that he had assured to pay/deposit the dues within 1-2 months, which clearly proves that the repossession of the Complainant’s vehicle without making proper demand for the outstanding dues and without following the procedures laid under law in repossessing the vehicle though the right has been conferred under the Loan Agreement, is illegal as the demand notices dated 16.02.2021 and 08.04.2021 as alleged to have been sent by the Opposite Party demanding payment dues from the Complainant, no proof of dispatch or no proof of delivery of the said notices sent to the Complainant was produced by the Opposite Party before this Commission. Further the contention of the Opposite Party that they had given 9 clear days notice on 17.08.2021 through SMS to the registered mobile number of the Complainant and sold the vehicle on 26.08.2021, is not legally sustainable, as held above that the repossession of the Complainant’s vehicle is illegal, the sale of his vehicle is also illegal. Hence the illegal act of repossessing the Complainant’s vehicle without following the procedures laid under Law as well as the above referred Judgement of Hon’ble National Consumer Disputes Redressal Commission, clearly amounts to deficiency of service on the part of the Opposite Party. Therefore, this Commission is of the considered view that the Opposite Party had committed deficiency of service and caused mental agony to the Complainant. Accordingly Point No.1 is answered.

Point Nos. 2 and 3 :

8.     As discussed and decided Point No.1 against the Opposite Party, the Opposite Party is liable to pay a sum of Rs.50,000/- towards deficiency of service and mental agony caused to the Complainant and also to pay a sum of Rs.5,000/- towards cost of the litigation, to the Complainant. Though Point No.1 is decided in favour of the Complainant, as the Complainant had used the vehicle till the date of illegal repossession and the Complainant is due and payable to the Complainant, the Complainant is not entitled for refund of the amount he had paid under the Loan Agreement to the Opposite Party along with interest except for the compensation for deficiency of service and mental agony caused by the Opposite Party. And also the Complainant is not entitled for any other relief/s. Accordingly Point Nos. 2 and 3 are answered.

In the result the Complaint is allowed in part. The Opposite Party is directed to pay a sum of Rs.50,000/- (Rupees Fifty Thousand Only) towards deficiency of service and mental agony, along with cost of Rs.5,000/- (Rupees Five Thousand Only) to the Complainant within 8 weeks from the date of receipt of this order, failing which the above said amount of Rs.50,000/- shall carry interest @9% p.a from the date of the order till the date of realization.

Dictated to Steno-Typist, transcribed and typed by her, corrected and pronounced by us in the Open Commission, on 11^th of  April 2023.

 

 

S. NANDAGOPALAN               T.R. SIVAKUMHAR                    B.JIJAA

      MEMBER II                         MEMBER I                        PRESIDENT

List of documents filed on the side of the Complainant:-

Ex.A1	14.08.2021	Complaint to the Inspector of Police, Valasaravakkam Police Station
Ex.A2	16.08.2021	C.S.R bearing No.435 of 2021 issued by the Inspector of Police
Ex.A3	17.08.2021	SMS message from the Opposite Party
Ex.A4	17.08.2021	Letter to the Opposite Party sent by the Complainant
Ex.A5		Registration certificate of vehicle
Ex.A6	11.11.2021	Letter through e-mail from the Opposite Party
Ex.A7		Payment of instalment receipt
Ex.A8		Loan agreement
Ex.A9	19.11.2021	Order in CMP No.4709 of 2021 passed by Judicial Magistrate No.1, Poonamallee
Ex.A10		Vehicle purchase invoice bill
Ex.A11		Copy of petition filed before the Judicial Magistrate, u/s 156(3) of Cr.P.C

 

 List of documents filed on the side of the Opposite Party:-

Ex.B1	17.05.2017	Copy of Loan Agreement
Ex.B2	16.02.2021	Copy of Demand notice
Ex.B3	08.04.2021	Copy of Demand Notice
Ex.B4		Intimation to the customer Vide SMS
Ex.B5		Pre Repossession Intimation to the Police
Ex.B6		Post Repossession Intimation to the police
Ex.B7		Reply sent to the RBI Ombudsman
Ex.B8		Reply sent to Police Station
Ex.B9	29.11.2021 & 13.01.2022	Statement of Account

 

 

S. NANDAGOPALAN               T.R. SIVAKUMHAR                    B.JIJAA

      MEMBER II                          MEMBER I                            PRESIDENT