DISTRICT CONSUMER DISPUTES REDRESSAL FORUM PALAKKAD

Dated this the 30^th day of April 2011

Present : Smt. Seena.H, President

: Smt. Preetha.G. Nair, Member

: Smt. Bhanumathi.A.K, Member Date of filing: 8/03/2010

(C.C.No. 31/2010)

C.Chandran

S/o.Chellappan

16/552, Kadur House

Mokshamkode, Kodunthirappully

Pirayiri Panchayath

Palakkad _ Complainant

(By Advocate John John)

V/s

1. Managing Director,

M/s.Phenomenal Plantations Ltd.

101/A, 'Divryasmrithi'

Opp.Toyota Show Room

Linking Road, Malad (West)

Mumbai – 64

(By Advocate K.B.Sunilkumar)

2.Joby Jose

Branch Manager

Phenomenal Healthcare Service Ltd.,

Room No.11/2008, 2^nd floor,

City Arcade, Manjakulam Road,

Palakkad - 14 - Opposite parties

(By Advocate K.B.Sunilkumar)

O R D E R

By Smt. SEENA.H, PRESIDENT

Case of the complainant in short :

Complainant took 2 units of teak bonds from the 1^st opposite party on 29/11/1994 on paying Rs.6600/-. As per the scheme of the opposite party if a person is taking units of Teak bonds @Rs.275/ per month per unit, on completion of 15 year, they will be providing Rs.45,000/ per unit. 2 Bond Certificates bearing Nos.0005977 and 0005978 was issued to the complainant. In the year 2005 complainant approached opposite party when he was in need of cash, but opposite party informed the complainant that he will get the benefit of the scheme only after the maturity period of 15 years i.e. after 29/11/2009. After 29/11/2009 complainant approached the 2^nd opposite party, who is the branch office of opposite party at Palakkad for surrendering teak bonds, but 2^nd opposite party behaved in a rude manner complainant again approached the 2^nd opposite party when it was informed that he will be getting the assured amount after 1 ½ month. Believing the words complainant deposited the original of the teak bonds with 2^nd opposite party. Complainant again approached 2^nd opposite party on 25/1/2010. At that time 2^nd opposite party informed the complainant that since M/s Phenomenal Plantations Ltd. Teak Bond did not attain expected growth, complainant is eligible to get only Rs.13,200/-. According to the complainant the act of opposite parties amounts to unfair trade practice and hence the complaint.

Opposite parties entered appearance and filed version contending the following:

Opposite parties admit the issuance of teak bonds, but denied that they assured to pay Rs.45,000/- per unit after 15 years. Rs.45,000/- according to opposite parties is only an expected amount. Further after the initiation of the scheme, SEBI has issued a circular for cancellation of all plantation scheme and to return the amount deposited by the depositors. This was informed by opposite parties through paper publication dated 4/12/2002, 6/12/2002, 15/4/2003, 3/11/2006, 6/2/2008. Complainant never contacted the opposite parties in this regard. Opposite parties returned double of the amount deposited for all holders who approached the opposite parties. Opposite parties has preferred appeal against the order of SEBI. Opposite parties deny the say of the complainant that he approached opposite parties in the year 2005. Opposite parties admits that the complainant has surrendered the certificate on 29/11/2009. At that time itself all the facts were conveyed to the complainant and he has agreed to accept the double of the amount agreed to be paid by opposite party. Accordingly a cheque for Rs.13,200/- drawn on SBI, Bombay branch was issued to Palakkad branch. Complainant has not collected the same. The scheme could not be carried forward due to no fault of the opposite parties. Hence there is no deficiency in service on the part of opposite parties.

Complainant led evidence in the form of affidavit and Ext.A1 & A2. Opposite parties filed chief affidavit. Ext.B1 to B3 marked. Complainant cross examined as PW1.

Now the issues that arise for our consideration are

1. Whether the act of opposite parties amounts to unfair trade practice and deficiency in service on their part ?

2. If so, what is the relief & costs complainant is entitled to ?

Issue 1 & 2

The definite case of the complainant is that opposite parties failed to repay the assured amount as per the Teak Bond Scheme. Complainant took 2 teak bonds for Rs.6600/- which was assured to be returned as Rs.90,000/- after 15 years.

Opposite parties on the other hand contented that the said scheme could not be carried forward since SEBI has issued a circular to stop all plantation schemes and opposite parties had published the same in the news papers. Many holders of this bond approached the opposite parties and twice of the amount paid by the holders were returned. Complainant also consented for the same when he approached after the maturity period and a cheque was issued to the SBI, Palakkad branch.

Further contented that they never promised to pay Rs.45,000/- after 15 years. In the certificate it is clearly mentioned that the expected return at the end of 15^th year is Rs.45,000/-

The issuance of teak bonds is admitted by the opposite parties and is also evident from Ext.A1 & A2. According to the opposite parties, Rs.90,000/- is only an expected amount of refund at the attainment of majority. Ext.B3 is the PPL Teak Bond containing the terms and conditions. Terms and conditions regarding estimated return read as follows:

“The estimated return at the end of 15 years will be 15 times of the amount invested in Teak trees and by seeing todays market price, we are of the opinion that the expected return will be more than what we have estimated and if the estimated selling price of the Teak trees will be more, the company shall share 20% of the excess amount”.

Even though a word 'estimated' is there in the said assurance, a common man on the whole reading of the assurance will only conclude that he will be getting more than 15 times of the amount deposited at the time of maturity and the maturity amount at any cost will not be less than 15 times of the deposited amount.

Section 2(1)(r) of Consumer Protection Act defines unfair trade practice. The said section read as follows:

“Unfair trade practice” means a trade practice which, for the purpose of promoting the sale, use or supply of any goods or for the provision of any service, adopts any unfair method or unfair or deceptive practice including any of the following namely,

8. makes to the public a representation in a form that purports to be

1. a warranty or guarantee of a product or of any goods or services; or

2. a promise to replace, maintain or repair an article or any part thereof or to repeat or continue a service until it has achieved a specified result, if such purported warranty or guarantee or promise is materially misleading or if there is no reasonable prospect that such warranty, guarantee or promise will be carried out.

Here opposite parties has made a promise without any intention to perform it. The act amounts to clear unfair trade practice on their part.

Now going through the reasons submitted by opposite party for non fulfillment of the terms of the scheme that since SEBI has issued a circular to stop all plantation schemes, it is seen that the said circular marked as Ext.B1 does not restrain the opposite party from fulfilling their assurance. On the other hand in Ext.B2, it is provided that as per an earlier order, opposite party shall refund the money collected under the schemes with returns which is due to the investors as per the terms of the offer within a period of one month from the date of the said order. So it is the bounden duty of opposite party to act as per their assurance as well as the directions of SEBI.

Opposite party has contented that intimation of the said circular was published in newspapers on 4/12/2002, 6/12/2002, 15/4/2003, 3/11/2003, 3/11/2006, 6/2/2008. No evidence in this regard is produced before the Forum. On the other hand opposite party has produced a paper publication of the said intimation in Mathrubhumi daily dated 2/7/2010 and is marked as Ext.B2. Here it is relevant to note that the present complaint is filed on 8/3/2010. Hence we are of the view that Ext.B2 evidence is not at all a reliable one.

In view of the above stated facts and circumstances of the case, we are of the view that the act of opposite parties amounts to clear unfair trade practice and complainant is entitled for the assured sum alongwith adequate compensation.

In the result complaint allowed. Opposite parties is directed to pay complainant an amount of Rs.90,000/- (Rupees Ninety thousand only) together with Rs.10,000/- (Rupees Ten thousand only) as compensation and Rs.1000/- (Rupees One thousand only) as cost of the proceedings. Order to be complied within one month from the date of receipt of order failing which the whole amount shall carry interest at the rate of 9% per annum from the date of order till realisation.

Pronounced in the open court on the 30^th day of April 2011

Sd/-

Smt.Seena.H President

Sd/- Smt.Preetha.G.Nair

Member

Sd/-

Smt.Bhanumathi.A.K

Member

APPENDIX

Exhibits marked on the side of the complainant

Ext.A1 – Attested copy of Teak Bond issued by Phenomenal Plantations Ltd

Ext.A2 – Attested copy of Teak Bond issued by Phenomenal Plantations Ltd

Ext.A3 – Receipt dated 11/12/09 issued by 2^nd opposite party

Cross examination of complainant

PW1 - C.Chandran

Exhibits marked on the side of the opposite parties

Ext.B1 – Notary attested copy of SEBI directions

Ext.B2 – Copy of Paper publication Mathrubhoomi daily dtd.2/7/2010

Ext.B3 – Terms and conditions of PPL Teak Bond.

Witnesses examined on the side of the Opposite parties

Nil

Cost Allowed:

Rs.1000/- allowed as cost of proceedings

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM PALAKKAD

Dated this the 31st day of May 2010 .

Present : Smt. H. Seena, President

: Smt. Bhanumathi.A.K, Member

C.C.No.31/2010

C. Chandran

S/o. Chellappan

16/552, Kadur House

Mokshamkode

Kodunthirappully

Pirayiri Panchayath

Palakkad . - Complainant

( Adv. John John)

V/s

1. M/s. Phenomenal Plantations Ltd

101/A ’Divyasmrithi’

Opp. Toyoya Show Room

Linking Road, Malad (West)

Mumbai - 64

(Rep. By its Managing Director)

(Adv. K.B. Sunilkumar)

2. Joby Jose

Branch Manager

Phenomenal Healthcare Services Ltd

Room No.11/208, 2^nd Floor

City Arcade, Manjakkulam Road

Palakkad – 14 - Opposite parties

(Adv. K.B. Sunilkumar)

O R D E R

By Smt. Seena.H, President.

Complainant represented. Posted as affidavit of the complainant finally. No affidavit filed. Hence dismissed for default.

Pronounced in the open court on this the 31st day of May, 2010.

PRESIDENT (SD)

MEMBER (SD)