BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM AT BANGALORE URBAN

24^th DAY OF AUGUST 2015

Orders on IA U/s.11 of Consumer Protection Act, 1986.

SRI. P.V SINGRI, PRESIDENT

This application is filed by OP-2 challenging the territorial jurisdiction of this Forum to entertain the present complaint.

2. The brief averments made in the application are as under:

The complainant has filed this complaint on constructed cause of action thereby falsely creating territorial jurisdiction of this Forum at Bangalore.  That the present complaint has been filed with a sole intention to recover the maturity amount of the fixed deposit schemes of OP-1 Company M/s.Omnitech Info solutions Ltd., having its registered office at Mumbai.  The complainant herself has duly read, filled, signed the application form and handed over the same to this OP along with account payee cheque (the invested amount) with a request to forward the same to the office of OP-1 located at Mumbai.  The registered office of the OP-1 is located at Mumbai and OP-1 does not have any branch office at Bangalore.  The application form for the said investment as well as the account payee cheque submitted by the complainant and forwarded by this OP were processed and accepted and finally encashed at Mumbai office of OP-1.  The original fixed deposit certificate was issued by OP-1 from their office at Mumbai.

For realization the fixed deposit maturity amount the complainant needs to deposit the original fixed deposit certificate at the office of OP-1 at Mumbai.  The request of the complainant for redemption of fixed deposit has to be processed by OP-1 from their corporate office at Mumbai only.  In view of the facts mentioned above the complainant has no cause of action or grievance against the OP-2.  All the dealings in respect to present transaction have taken at Mumbai office of OP-1.  The OP-2 never had any commercial transactions/dealings with the complainant.  Hence she cannot maintain any claim against this OP.  The complainant in view of the facts mentioned above cannot maintain the present complaint at Bangalore.  The OP-2 has acted as a broker or facilitator who merely on the instructions of the complainant forwarded her fixed deposit application form as well as account payee cheque to OP-1 Company.  The complainant does not have any pecuniary relations with OP-2, since OP-2 has not received pecuniary compensation/consideration/fees etc., for the above said services from the complainant.  Therefore, the complainant has no cause of action to file the complaint against OP-2 so also the complainant does not have territorial jurisdiction to file the present complaint at Bangalore.  The OPs.1 & 2 are two separate companies and two separate legal entities duly incorporated under the provisions of companies Act, 1956.  At no point of time Master – Servant/ Principal – Agent relationship ever existed between the complainant and OP-2.  Since this Forum has no territorial jurisdiction to entertain the present complaint, the issue of jurisdiction shall be trialed as preliminary issue before entering into the merits of the case.

For the aforesaid reasons, the OP-2 prays for rejection of the complaint for want of territorial jurisdiction to entertain the complaint.

3. The complainant filed her objections to the above application contending in brief are as under:

That the OP-2 not just acted as broker/facilitator but represented the OP-1 and acted more than a guarantee to the OP-1.  The OP-1 took complete ownership and issued receipts to the complainant for the deposit made with OP-1 on the advertisement by OP-2 that OP-1 is a good company for investment the complainant was encouraged to make deposit in OP-1.  The complainant made the investment with OP-1 at the behest of OP-2.  At the instance of OP-2 the complainant has invested her hard earned money with OP-1.  The original fixed deposit certificate has been submitted to OP-2 on its maturity and not directly to OP-1 which means that OP-2 is dealing with fixed deposit scheme run by OP-1.  Only because of the trust she had with OP-2 she invested her hard earned savings in fixed deposit scheme run by OP-1.

For the aforesaid reasons, the complainant prays for dismissal of the application.

4. The complainant has filed the present complaint with a prayer to pass an order directing both OPs.1 & 2 to pay her the maturity amount of Rs.78,403/- along with interest and compensation of Rs.75,000/- and the litigation costs.  It can be seen from the complaint and the documents produced by her, she deposited a sum of Rs.70,000/- in fixed deposit scheme run by OP-1 Omnitech Info Solutions Ltd., having its corporate office at Mumbai on 31.08.2012 which was matured on 31.08.2013.  The said deposit was for a period of 12 months and carried interest @ 11.50% p.a.  The maturity amount at the end of 12 months is Rs.78,403/-.  After the maturity of deposit she approached OP-2 through whom she invested the said money and requested them to get her matured amount.  However, it appears that she did not get her matured amount even after 6 months from the date of maturity.  Therefore she has approached this Forum for redressal.

5. The learned advocate for the OP-2 argued that the OP-2 is a Company duly incorporated under the provisions of companies Act, 1956 and dealing in shares of various listed companies.  He further argued that the OP-2 are share brokers who facilitate the investors to invest in various companies and invest in fixed deposit in various companies situated all over the country.  It appears that the OP-2 company after scrutiny of the balance sheet of each company on the share market, advise the public for investment of their money either in the shares, debentures or in the fixed deposits.  It appears that on the advertisements published by OP-2 company, the complainant invested a sum of Rs.70,000/- in OP-1 company in a fixed deposit scheme run by the said company for a period of one year.  It appears that the complainant was lured by the rate of interest offered by OP-1 as the same is much higher than what is offered by the nationalized Banks.

6. The complainant did not deny that OP-1 Company in which she has invested money is situated at Mumbai.  She also did not deny that her application for investment together with account payee cheque issued by her was forwarded to OP-1 Company at Mumbai by the OP-2.  She also did not deny that there is no any monetary transaction between herself and the OP-2.  Admittedly complainant has not paid any fees or anything like that to OP-2 for the services rendered by them.  From the averments made in the application, it is crystal clear that the OP-2 is simply a facilitator for investment of money by the complainant.

7. Admittedly the head office / corporate office of OP-1 is situated at Mumbai and they did not have any branch office/working office anywhere in Bangalore.  The investment made by the complainant has been received by OP-1 at their Mumbai office and her application has been processed at their Mumbai office and the fixed deposit certificate has been issued by Mumbai office of OP-1.  Thus all the transactions have taken place at Mumbai office.  OP-2 has simply collected the application form from the complainant together with her account payee cheque in favour of OP-1 and forwarded the same to OP-1 at Mumbai.  Thus from the averments made in the application and the admissions on the part of complainant goes to establish that the OP-2 is neither in authorized agent of OP-1 nor has issued fixed deposit receipt to the complainant on behalf of OP-1, expect that they have facilitated the investment made by the complainant in OP-1.

8. Now the question is whether this Forum has territorial jurisdiction to entertain the present complaint in view of the fact that the head office/corporate office of OP-1 is situated at Mumbai and they do not have any branch/working office at Bangalore and also the investment made by the complainant has been received at Mumbai office and the fixed deposit certificate have been issued from Mumbai office of OP-1.

9. To invoke the territorial jurisdiction of this Forum, the complainant has to satisfy the legal requirements contained in sec.11 of the C.P act, 1986.  Sec.11 of C.P Act, 1986 reads as under:

Jurisdiction of the District Forum – (1) Subject to the other provisions of this Act, the District Forum shall have jurisdiction to entertain complaints where the value of the goods or services and the compensation, if any, claimed does not exceed rupees twenty lakhs.

(2) A complaint shall be instituted in a District Forum within the local limits of whose jurisdiction,-

(a)        the opposite party or each of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain, or

(b)        any of the opposite parties, where there are more than one, at the time of the institution of the complaint, actually and voluntarily resides or carries on business or has a branch office or personally works for gain, provided that in such case either the permission of the District Forum is given, or the opposite parties who do not reside, or carry on business or have a branch office, or personally work for gain, as the case may be, acquiesce in such institution; or

(c)        the cause of action, wholly or in part, arises.

10. In view of the discussions made above, we are of the opinion that the OP-2 is not a necessary party to the present complaint for the reason that OP-2 Company is independent company and neither authorized agent of OP-1 nor working exclusively for OP-1.  OP-2 is also share brokers and acted as facilitators to various investors to invest their money in various listed companies.  They do not have any monetary dealings with any of the investors like the complainant.  In the instant case on hand they have not received any fees/charges from the complainant in facilitating her to invest money in the OP-1 company.

11. Looking from any angle OP-2 company is not answerable to the claim made by the complainant in the present complaint and they cannot held responsible for the default committed by OP-1 in not paying maturity amount to the complainant.  As already stated above the OP-1 does not have any branch office in Bangalore.  Therefore, the complainant cannot invoke the jurisdiction of this Court to file this complaint in view of the provisions contained in sec.11 of the C.P Act.

12. The learned advocate for the OP-2 referring to a judgment passed in complaint case No.178/2014 dated 01.04.2015 by the State Consumer Disputes Redressal Commission, U.T., Chandigarh argued that this Forum lacks territorial jurisdiction to entertain the present complaint, since the OP-1 has its head office/corporate office at Mumbai and does not have any branch office/working office at Bangalore.  Carefully perused the said judgment.  The facts of the case dealt in the said judgment are almost similar to the facts on case on hand.  The Hon’ble State Consumer Disputes Redressal Commission, U.T., Chandigarh during the course of its judgment has referred to the judgment rendered by the National Consumer Redressal Commission, New Delhi in a case between Puran Chand Wadhwa Vs. Hamil Era Textiles Ltd., IV (2003) CPJ 26 (NC).  In case of Puran Chand Wadhwa, referred supra, the money was invested with the OP therein through a Bank situated at Chandigarh.  The Hon’ble National Commission held that the Bank was only a facilitator to accept the money at the time of floating of debentures and encash cheques issued by the respondent therein which was a limited service being rendered by it to all aspiring investors.  Therefore, the National Commission held that by no stretch of imagination could it (Bank) be called the agent of the respondent therein.  In the said case the debentures were issued from Bombay and the said debentures will be redeemed from Bombay.  Therefore the National Commission held that the District Forum at Chandigarh had no territorial jurisdiction to entertain and decide the complaint.

13. In the instant case on hand the OP-2 has only acted as a facilitator to the complainant and to other investors to invest money in the fixed deposit run by OP-1, whose corporate office/head office is situated at Mumbai.  Therefore, in view of the principles laid down in the above cited case, OP-2 cannot be treated as agent of OP-1.  The money in the instant case on hand has been invested in Bombay and will be redeemed from Mumbai.  Therefore it cannot be said that any can actionable claim was performed in the local limits of this Forum.

14. In view of the principles enunciated in the above said complaint case No.178/2014 between Mrs.Renu Kapur Vs. Mr. Lalit Malhotra and others and in view of the ratio laid down by Hon’ble National Commission in case of Puran Chand Wadhwa Vs. Hamil Era Textiles Ltd., we are of the opinion that this Forum has no territorial jurisdiction to entertain the present complaint.  Therefore, the complaint has to be returned to the complainant for its presentation before appropriate Forum having territorial jurisdiction to entertain and decide the same.

15. In the result, we proceed to pass the following:

O R D E R

I.A filed by the OP-2 U/s.11 of the Consumer Protection Act, 1986 is allowed holding that this Forum has no territorial jurisdiction to entertain and decide the present complaint.  Further office is directed to return the complaint to the complainant along with documents after retaining the attested true photo copies of the same, for its presentation before the appropriate Forum having territorial jurisdiction to entertain and decide the same.

(Dictated to the Stenographer, got it transcribed and corrected, pronounced in the Forum on this 24^th day of August 2015)

MEMBER                            MEMBER                      PRESIDENT

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