Delhi

North East

CC/7/2019

Arif Mohammad Ahmed - Complainant(s)

Versus

Muthoot Finance Ltd. - Opp.Party(s)

16 Jan 2019

ORDER

DISTRICT CONSUMER DISPUTES REDRESSAL FORUM: NORTH-EAST

GOVT. OF NCT OF DELHI

D.C. OFFICE COMPLEX, BUNKAR VIHAR, NAND NAGRI, DELHI-93

 

Complaint Case No. 07/19

 

In the matter of:

	Shri Arif Mohammad Ahmed S/o Shri Nizamuddin R/o F-198/ S-3 Dilshad Colony, Seemapuri Delhi-110095	Complainant
	Versus
	Muthoot Finance Ltd. Through its Manager Plot no.-1, block-F First Floor, Dilshad Garden Delhi-110095	Opposite Party

 

DATE OF INSTITUTION:     JUDGMENT RESERVED ON:               DATE OF DECISION      :

14.01.2019 16.01.2019 16.01.2019

 

N.K. Sharma, President

Ms. Sonica Mehrotra, Member

 

Order passed by Ms. Sonica Mehrotra, Member

 

ORDER

1. The complainant has argued that he had availed of Gold loan no. MLS-237 from OP on 21.09.2016 of Rs. 2,28,000/- from OP against pledge of 128 gm of gold jewellery and was bound to pay monthly installments @ 1% of the gold loan per month. However as per complainant’s on admission and documentary evidence, he only paid a sum of Rs. 57,116/- to OP 16.08.2017 towards repayments of the gold loan availed and paid no amount in 2018 due to financial crisis. The complainant visited OP office on 01.01.2019 for settlement of gold loan but on 05.01.2019, an employee of OP visited the complainant and demanded a wrongful interest of Rs. 98,982/- and handed over a notice for repayment of the gold loan failing which the pledged gold shall be auctioned. Therefore, the present complaint against wrongful levy of interest and prayed for directions to OP to close the gold loan on the principal sum and agreed upon interest thereon apart from damages and litigations charges.
2.  Arguments heard on admission. As regards the admissibility of the complaint, a pawn is a security whereby a deposit of goods is made by contract as security for debt. Section 2 (o) of CPA defines “service” to include provisions of facilities in connection with banking and financing. The service availed herein by the complainant is that of availing gold loan from OP on pledging gold jewellery as security of goods.  The Hon’ble National Commission in citation in Standard Chartered Bank Vs P.N. Tantia 1997 (2) CPR 237 (NC) came to the conclusion that the transaction of pledging of shares and availing advance / over draft facilities thereagainst did not come within the ambit of CPA and observed that ‘the bank could file a suit for recovery of the debt and retain the pledged good as a collateral security’. In view of this we are of the opinion that it was a relationship of a creditor and debtor so far as pledged shares were concerned. The remedy of the pawner for an improper sale of pledged goods is for recovery of damages. The complainant therefore could not resort to remedies provided under CPA 1986. The Hon’ble National Commission therefore had established that the relationship in such cases of creditor and debtor were matters to be entertained only by a Civil Court.  

The Hon’ble National Commission in the judgment of Standard Chartered Bank Vs P.N. Tantia 1997 (2) CPR 237 (NC) had held in cases where the relationship between bank and complainant was held to be that of creditor and borrower, averment of deficiency of service is not maintainable and therefore the complainant / pawner could proceed against the bank by way of Civil Suit for recovery of damages and not resort to Consumer Protection Act, thereby setting aside order passed by Hon’ble State Commission which had allowed the complaint and had awarded compensation to the complainant. Further in the case of D K Lalwani Vs President, Indian Bank Mutual Fund 2002 (I) CPR 161 (NC), the Hon’ble National Commission confirmed the order of the lower Fora holding that complainant could not raise consumer dispute for alleging deficiency in service against the bank in not splitting hypothecated shares as relationship between parties was simply that of creditor and debtor.

3. We therefore, in light of the rulings of the Hon’ble National Commission and in the facts and the circumstances of the case are of the considered opinion that the present dispute does not fall within the ambit of consumer complaint within the parameters of Consumer Protection Act in as much as the relationship between the complainant and the OP is that of pawner and pawner that is debtor and creditor and there was no hiring of services under Section 2(1)(o) of the Act and therefore the competent court of jurisdiction in the present dispute is Civil Court and the complainant is at liberty to seek appropriate relief against the alleged wrongful / excessive amount charged from him by OP against pledged gold. We accordingly, dismiss the present complaint, on grounds of non maintainability / inadmissibility with no order as to costs.
4. Let a copy of this order be sent to the complainant free of cost as per regulation 21 of the Consumer Protection Regulations, 2005.
5. File be consigned to record room.

Announced on 16.01.2019

 

(N.K. Sharma)     President

(Sonica Mehrotra)  Member