DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION, PALAKKAD

Dated this the  30^th day of January, 2023

Present      :   Sri. Vinay Menon V.,  President

                  :  Sri. Krishnankutty N.K., Member                                Date of Filing: 13/01/2020    

                         CC/8/2020

Ubaid,

S/o.Abdulla,

Villan House,

Payyanadam, Mannarkkad

Palakkad – 678 583                                                    -                       Complainant

(By Adv.Viju K Raphel)

                                                                                    Vs

1. M/s.Piaggio Vehicles Pvt.Ltd.

Rep. by Managing Director,

8^th floor, Sky One, Kalyani Nagar,

Pune, Maharashtra – 411 006.

2. M/s.SML Motors,

Rep. by its Manager,

NH 47, Coimbatore Road,

Marutha Road (PO),

Palakkad – 678 007

 Presently functioning at SML Motors Kakkalai,

Thrissur – 680  721.

3. M/s.BRD Motors Ltd.,

Rep.by its Managing Director,

BRD Complex,

NH Byepass, Konikara,

Thrissur – 680 306.

4. M/s.ESAF Small Finance Bank Ltd.,

Rep.by its Managing Director,

Town Branch, DPO Road,

Palakkad – 678 014                                               -                       Opposite parties

                   (OP1 by Adv.M/s. Saji Mathew & Shiju Kuriakose

                     OP2 by Adv.M/s.B.S.Sureshkumar & Sidharthan.S.

                     OP3 No representation;  &

                     OP4 by Adv.M/s. M.P.Ravi & M.J.Vince)

O R D E R

By  Sri. Vinay Menon V., President

1. Inorder to avoid confusion, designation/roles of the opposite parties are detailed.

1^st opposite party is the manufacturer of vehicles sold under the Brand name Piaggio. 2^nd opposite party is a dealer cum service centre of the 1^st opposite party. 2^nd opposite party stopped being the authorized dealer of the 1^st opposite party and hence the vehicle was taken to another authorized service centre, the 3^rd opposite party. 4^th opposite party is the financier who provided financial assistance to the complainant for purchase of the vehicle.  

2.         Complainant claims to have purchased a LMV Goods carrier, manufactured by 1^st opposite party through the 2^nd opposite party, dealer of the 1^st opposite party. 2^nd opposite party arranged for finance from the 4^th opposite party. Total cost of the vehicle was Rs. 3,45,459/-. Down payment was Rs. 1,40,000/- and balance Rs. 2,42,000/- was the financial assistance.   

Within 4^th month and 7^th month of delivery, the vehicle developed problems that were repaired by the opposite party 2. Thereafter, the vehicle stopped again for a 3^rd time and the vehicle was taken to the yard of the 2^nd opposite party. The opposite party 2 has not carried out any repairs as they had wound up being the authorized service station of the 1^st opposite party. Hence vehicle was taken to the 3^rd opposite party, another service station of the 1^st opposite party. But 3^rd opposite party has not carried out any repair works. The complainant apprehends manufacturing defects.  The opposite party 2 had connived with the 4^th opposite party to provide financial assistance from the 4^th opposite party for exorbitant rates of interest. Aggrieved thereby, this complaint is filed against the 1^st opposite party alleging manufacturing defect, against 3^rd opposite party alleging deficiency in service in not repairing the vehicle and against 4^th opposite party for charging exorbitant and illegal interest rates.

3.         Opposite parties 1, 2 and 4 filed separate versions repudiating complaint pleadings. Opposite party 3 did not file version.

i.          Opposite party 1 filed version detailing legal and factual grounds for dismissing the complaint. As the vehicle was used for carrying shipments, the vehicle was used for commercial purposes. The vehicle had already driven for over 30,000 kms. Even-though the first 2 services were carried out, the mandatory services for 10,000, 15,000 20,000, and 25,000 kms were not carried out. Thereafter the vehicle was brought to the yard of the 3^rd opposite party with complaints of abnormal sound from the gear box. The vehicle was kept repaired in the yard of the 3^rd opposite party, but the complainant failed to take recovery of the vehicle. Body of the vehicle suffered from sagging which was indicative of over-loading.   Presently 3^rd opposite party is also not an authorized service partner of the 1^st opposite party.

ii.         Opposite party 2 filed version contenting that they were unnecessary parties to the lis as they stopped functioning as the authorized service station of the 1^st opposite party. Financial assistance was not availed at the behest of the 2^nd opposite party, as 2^nd opposite party was having business association with SML Finance alone. Gear complaint suffered by the vehicle was due to rough use of the vehicle and over-loading.  

iii.        Opposite party 4 filed a detailed version stating that they never induced the complainant to avail the loan. They had not levied exorbitant interest rates and has levied loan in terms of the agreed contractual rates. The complainant had failed to remit installments and the loan is overdue. 

4.         The following issues arise for consideration:

1.         Whether the complaint is barred by any statutory impediments?

2          Whether the vehicle suffers from any manufacturing defects?

3.         Whether there is   deficiency in service/unfair trade practice on the part of the opposite party 2?

4.         Whether there is   deficiency in service/unfair trade practice on the part of the opposite party 3?

5.         Whether there is   deficiency in service/unfair trade practice on the part of the opposite party 4?

6.         Whether the complainant is entitled to any of the reliefs sought for?

7.         Reliefs, if any?

5.i.       Evidence of complainant comprised of Proof affidavit and Exhibits A1 to A10. Complainant was examined as PW1.

Marking of Ext. A9 was objected to as it is a photocopy unaccompanied by S. 65B certification. It is also part of a document. Since this Commission is not bound by the straitjacket of Indian Evidence Act, we overlook the objections that Ext. A9 is a photocopy and is unaccompanied by S. 65B certification. But we cannot rely on merely a part of a document  to arrive at a conclusion. Hence Ext. A9 stands rejected.

ii.         Opposite party 1 filed proof affidavit. No documents were marked by the 1^st opposite party. They had also failed to produce the documents directed to be produced.

iii.        O.P.s 2 and 3 did adduce any evidence.

iv.        O.P.4 filed proof affidavit. Witness for O.P.4 was examined as DW1. Document sought to be marked as Ext. B1 by the 4^th O.P. was already marked as Ext. Ext. A7. Hence Ext. B1 was not marked.

v.         Report filed by the Expert Commissioner was marked as Ext. C1.

Issue No.1

6.         On a perusal of the pleadings the two questions that arise for consideration are

            1) Whether the complainant has put the vehicle into use for commercial purposes?

            2) Whether there is misjoinder of cause of action?

7.         OP1 has raised the question of commercial purpose. It is their case that the complainant purchased the vehicle and put it to use for transferring materials, which, in their opinion, tantamount to commercial purpose.  A reading of the facts and circumstances and evidence would prove that the complainant purchased one vehicle and had been using the said vehicle for transporting materials. This cannot be termed to be a commercial purpose as contemplated under Consumer Protection Act.  It can clearly be seen that the purpose to which the vehicle was put to is for earning a livelihood. 

Thus there is no bar of commercial purpose in adjudicating this complaint.

8.         The next question is whether the complaint is bad for misjoinder of cause of action. On going through the pleadings it can be seen that the pleadings as against 1 to 3 can be separated from the case as against OP 4. In fact, the cause of action as against OPs 1 to 3 and OP4 can be adjudicated without any hitch even if the parties are removed.  Two independent cases would survive in the facts and circumstances of the case.

But since the opposite parties have not raised this issue at any stage, we presume that the opposite parties have waived this ground.

            Issue No.2

9.         It is the case of the complainant that within 4 months of taking delivery, the vehicle suffered from serious defects. Thereafter during the 7^th  month and during a subsequent unstated point of time also the vehicle suffered from defects, after which the vehicle had to be kept in the yard of the 3^rd opposite party. These statements were stoutly opposed by the 1^st opposite party. The 1^st opposite party did admit that the vehicle suffered some problems, but per O.P.1, the 2^nd opposite party and the 3^rd opposite parties had rectified the complaints. They also contend that the complainant had failed to carry out the mandatory  services to be carried out during 10000, 15,000, 20,000, 25,000 & 30,000 kms. It was also found that the body of the vehicle was sagging which is indicative of overloading the vehicle. The 1^st O.P. contented that the vehicle was repaired and was kept in the yard of the 3^rd O.P., and it was the complainant who refused to take delivery of the vehicle even after informing him that the vehicle is  repaired.

10.       In order to ascertain the condition of the vehicle, the complainant took out an Expert Commissioner. The terms of reference were to report the present condition of the vehicle and also to assess the manufacturing defect of the vehicle.

            The said report filed by the Expert Commissioner was marked as Ext.C1. Paragraph 3 & 4 of Ext.C1 is worthy of being reproduced.

            “3.        At the time of my inspection, I found the above mentioned vehicle in the garage of the 3^rd opposite party. I found that front and rear wheels, brake, gearbox, clutch and silencer are in disassembled condition and the gearbox is not present in that vehicle. I could also see that vehicle is in rusted condition without doing proper maintenance for a long period. I found most of the parts of the vehicle is unfit to use or missing. I also found that the front tyres are in damaged condition and is in an unusable condition. The upholstery of the driver seat of the vehicle are also seen damaged. So it is not fit to perform in the road.

            4.         Even though, the service history of the vehicle was asked for from the 3^rd opposite party, directly at the time of inspection of the vehicle, they failed to provide the same. From my inspection, it is seen that the chances of the vehicle to be in a road worthy condition is very remote. “

11.       Since the opposite parties 1 and 3 did not hand over the service history of the vehicle, the complainant filed an application as I.A. 65/2021 seeking a direction to 1^st opposite party to produce the repair and service history of the vehicle, which was allowed as early as 19.03.2021. There is no doubt that the said document which forms part of the documentation process of a dealer/manufacturer of vehicles would shed light on the veracity of the pleadings and counter pleadings raised by the parties. The 1^st opposite party had not filed the said documents sought to be produced by the complainant.  While so, the aspect of non-production was taken up on 31/12/2021 and this Commission ordered that adverse presumption can be resorted to against the O.P. concerned. And till 13/01/2023, through 9 effective postings, the 1^st opposite party had not produced the said documents. The complainant had taken all steps to prove their case.  

12.       The opposite parties 1 and 3 have failed to produce the documents that would absolve them of any liability, had their pleadings been true. They have also not filed any affidavit stating the cause for non-production.   Non-production of the history sheet of a vehicle is nothing short of willful suppression of material evidence. In fact, pleadings of the 1^st opposite party is very meticulous regarding the use of the vehicle by the complainant. The 1^st opposite party has not stated how they had laid down the factual aspects, if not for the history sheet of the vehicle. Had the pleadings been factual, nothing prevented the opposite party 1 from production of documents that would render their pleadings admissible.

Hence we resort to presume that production of the said documents would adversely affect the case of the Opposite parties 1 and 3 and would render their pleadings a falsity.

13.       It is also relevant to note that the opposite parties 1 to 3 had not filed any objection to Ext. C1 Commission Report. Hence the Expert Commissioner’s findings regarding the status of the vehicle remain unchallenged.

14.       Thus we hold that the complainant’s vehicle suffers from manufacturing defect.

            Issue No. 3

15.       There are no pleas against the 2^nd opposite part and no relief is sought as against them. They are absolved of any liability.

            Issue No. 4

16.       Paragraph 3 of Ext. C1 depicts the stage of the vehicle as it was at the time of inspection by the Expert.  The front and rear wheels, brake, gearbox, clutch and silencer were in disassembled condition. The gearbox was not present in the vehicle. The vehicle was in a rusted condition without undergoing maintenance or repair for a long period. Most of the parts of the vehicle is unfit for use or were missing. Front tyres were in damaged condition and unusable. The upholstery of the driver’s seat of the vehicle was damaged.

17.       This is the condition of the vehicle when the 1^st opposite party asserted that the vehicle was kept in a repaired condition and that the complainant had refused to take possession of the vehicle. It is clear from a reading of Ext. C1 that the 3^rd opposite party has not only failed to carry out the repairs of the vehicle, but has stripped the vehicle of all essential parts rendering the vehicle useless.

18.       Thus there is deficiency in service on the part of the 3^rd opposite party.

            Issue No. 5

19.       Complainant’s case, with regard to 4^th opposite party is that they had levied interest at usurious rates of 23% p.a. and default interest rate of 30% p.a. Opposite parties had denied levying interests at the rates as alleged by the complainant.

20.       Inorder to substantiate his allegation, the complainant had marked Exts. A8 and A9. As already stated Ext. A9 stands rejected. Ext. A8 is a schedule of sanction terms. At the time of marking O.P.4 had not objected to marking of Ext. A8. Opposite party has no case that Ext. A8 is a forged or concocted document. Even during cross examining the complainant as PW1, the counsel for 4^th opposite party has not raised any question regarding the veracity, authenticity or sanctity of Ext. A8. Further, the opposite party has not produced any documents showing the interest rates levied on the financial assistance provided to the complainant. Hence Ext. A8 is undisputedly a document issued by the 4^th opposite party.  Ext. A8 shows that the allegations regarding interest rates being exorbitant and usurious are true.

21.       The question is whether the said interest rates are violative of the interest rates prescribed by RBI or not.  Witness for the O.P.4 was examined as DW1. DW1 is the Branch Manager of the main branch of the 4^th opposite party. To any pointed questions regarding the rates of interest, the witness has given evasive reply. He is unaware of the rate of interest fixed by RBI or Repo or Reverse repo rates applicable to the case of the complainant. It is pathetic to note that when the question in issue is the legality of the interest levied on a customer, that a witness as DW1, a manager of a Bank, should mount the box and plead ignorance and adduce evasive reply.

22.       Hence we find that production of relevant documents would not suit well for the case of the 4^th Opposite party. The sole presumption that we can arrive at is that the 4^th opposite party has resorted to levying exorbitant rates of interest.

23.       Thus there is deficiency in service on the part of the 4^th opposite party.

Issue No. 6

24.       Relying on the findings in Issues 2 and 4, we find that the complainant could not put the vehicle to continuous use even for one year from the date of purchase. Thanks to the 3^rd opposite party, the vehicle is not in roadworthy condition any more. Hence we find that the complainant is entitled to return of the price of the vehicle from the 1^st opposite party. The 1^st and 3^rd opposite party are also entitled to compensate the complainant for deficiency in service and for mental agony.

25.       It also stands proved that  the 4^th opposite party had levied exorbitant rates of interest. In that count also the complainant is entitled to relief. 

Issue No. 7

26.       Resultantly, we allow the complaint as follows:

1.         The 1^st opposite party shall repay Rs. 3,78,925/- (cost of the vehicle + statutory charges)to the complainant.

2.           The 1^st opposite party shall pay an interest of 10% on the said amount to the complainant from 10.11.2018 till the date of payment.

3.           The complainant is entitled to a compensation of Rs. 50,000/- from the 1^st opposite party for selling vehicle with manufacturing defect.

4.           The complainant is entitled to a compensation of Rs. 50,000/- from the 3^rd opposite party for deficiency in service for dismantling the vehicle.

5.           Demand for repayment made by 4^th O.P. based on Ext. A10 is annulled.

6.           The 4^th opposite party shall re-structure the loan of the complainant by calculating the interest rate based on the guidelines issued by RBI for the relevant periods, ignoring Ext. A10 notice.

7.           The complainant is entitled to compensation of RS. 50,000/- from the 4^th opposite party for the unfair trade practice on their part.

8.           The complainant shall be entitled to cost of Rs. 15,000/- from each of OPs 1, 3 and 4.

9.         The aforesaid amounts shall be paid within 45 days of receipt of a copy of this order, failing which the complainant shall be entitled to a solatium of Rs. 250/- per month or part thereof till the date of final payment of the amount stated above from each of O.P.s 1, 3 and 4. 

                  Pronounced in open court on this the 30^th  day of  January, 2023.         

                                                                                         Sd/-

                                                                                             Vinay Menon V

                                                      President

                                                               Sd/-

Krishnankutty N.K.

                                                                                                      Member

APPENDIX

Exhibits marked on the side of the complainant

Ext.A1   - Original invoice  dated 10/11/2018

Ext.A2  –   Copy of certificate of registration       

Ext.A3  -   Original of Motor Vehicle Insurance Cover Note

Ext.A4  -   Copy of ownership record and data

Ext.A5 series –  Copy of lawyer’s notice alongwith postal receipts and AD cards  

Ext.A6 –   Original of reply notice dated 21/11/19 issued by OP1

Ext.A7 –  Original of reply notice  dated 4/12/2019 issued by OP4

Ext.A8 –  Copy of schedule sanctioned terms dated 8/11/18

Ext.A9 –  Print out of Repo Rate from the website of RBI

Ext.A10 –Loan recall letter dated 11/2/2022  

Exhibits marked on the side of the opposite party: Nil

Court Exhibit: 

C1 – Commission report dated 23/1/2021

Third party documents:  Nil

Witness examined on the side of the complainant:

PW1 -  Ubaid (Complainant)

Witness examined on the side of the opposite party:  

DW1 – Yasar, Branch Manager, ESAF Bank

 Court Witness: Nil

NB : Parties are directed to take back all extra set of  documents submitted in the proceedings in accordance with Regulation 20(5) of the Consumer Protection (Consumer Commission Procedure) Regulations, 2020 failing which they will be weeded out.