FA.No.785/2011 against C.C.No.139/2010 District Forum,  Ranga Reddy District

Between

The Branch Manager

M/s Muthoot Finance Pvt. Ltd.,

Balanagar Branch,

R.R.District, Hyderabad.                                               ..Appellant/

                                                                                 Opp.party

                And

P.V.Ramana Murthy

S/o.P.Suryanarayana Murthy

Aged about 43 years, Occ:Private

Employee, R/o.House No.F-3, Plot No.350,

Anjaneyanagar, Moosapet,

Hyderabad-38.                                                            ..Respondent/

                                                                                 Complainant

Counsel for the Appellant               :  Mr.N.Srinivasa Rao

Counsel for the Respondents          :  Mr A.Rajendra Babu

QUORUM: THE HON’BLE SRI JUSTICE D.APPA RAO, PRESIDENT,

          AND

SMT.M.SHREESHA, HON’BLE MEMBER,

FRIDAY, THE TWENTY THIRD DAY OF NOVEMBER,

TWO THOUSAND TWELVE

Order (Per Smt.M.Shreesha, Hon’ble Member)

***

Aggrieved by the order in  C.C.No.139/2010 on the file of District Forum, Rangareddy District, the opposite party  preferred this appeal.

The brief facts as set out in the complaint are that the complainant submitted that he approached the opposite party for taking loan by pledging his gold chain weighing 48 grms and the opposite party provided an amount of Rs.25,000/- with interest @ 1.25 ps p.m.  The complainant submitted that he paid two instalments during October, 2007 and November 2007 and could not pay the subsequent instalments and informed opposite party about his problems and requested not to dispose of the same without intimation to the complainant.  The complainant submitted that the opposite party failed to comply the minimum guidelines of RBI before disposing of the chain, did not provide loan account balances and also did not inform of the auction conducted and disclose the amount obtained.  The complainant submitted that this is unfair trade practice and approached the Alternate Consumer Disputes Redressal Cell on 22-4-2010 and the opposite party attended and stated that they had disposed of the chain and that they are helpless.  Hence the complaint for a direction to the opposite party to return the gold chain after taking the loan amount, pay Rs.50,000/- towards compensation and costs of Rs.3,000/-.

Opposite party filed counter admitting that the complainant has obtained loan of Rs.25,000/- by pledging gold chain on 07-6-2007 and had not repaid the same inspite of repeated requests and also final notice.  It alleged that the complainant is not a consumer and submitted that notice was given prior to auctioning the gold chain and after observing all  formalities only the gold chain was sold and the proceeds were deposited to the loan account of the complainant.  The complainant is still due an amount of Rs.4,153/- and submitted that there is no deficiency in service as they have every right to sell the pledged article in case the loan is not repaid within the agreed time.  Opposite party further submitted that it is governed by the provisions U/s.172 to 179 of Indian Contract Act, and prayed for dismissal of the complaint with costs.

Based on the evidence adduced i.e. Exs.A1 and B1 to B7 and the pleadings put forward, the District Forum allowed the complaint directing opposite party to return the gold chain of 48 grms to the complainant after the complainant paying the entire loan amount with interest within 15 days from the date of receipt of order and the opposite party shall return the gold chain to the complainant immediately after receipt of the said amount.  It further directed the opposite party to pay Rs.10,000/- towards compensation and costs of Rs.1,000/-.

Aggrieved by the said order, the opposite party preferred this appeal.

        It is the complainant’s case that he approached opposite party for a loan of Rs.25,000/- evidenced under Ex.A1 and kept 48 grams of gold as security and promised to pay the loan amount with an interest of Rs.1.25 ps. per month and paid two instalments during October and November, 2007.  It is the complainant’s case that he could not pay the subsequent instalments and the opposite party without issuing any notice  and without furnishing any statement of account, disposed of the gold chain.  Thereafter the complainant approached Alternate Consumer Disputes Redressal Cell on 22-4-2010 and after issuance of notice, the opposite party appeared before the grievance cell and submitted that the gold chain was disposed of.  It is the appellant/O.P’s case that the complainant availed the gold loan on 07-6-2007 and the loan amount should be repaid within 12 months and only based on the declaration of the complainant, the gold loan was advanced.  The declaration stipulates that the gold ornament was given towards security of the loan and because the complainant became a defaulter, a demand notice was issued on 21-10-2008 and relied on Ex.B3 which is undated but which says that the complainant should clear the loan on or before 30-10-2008.  It is an admitted fact that this letter returned with an postal endorsement ‘no such person’ and auction was conducted thereafter on 12-11-2008 and the gold ornament was sold for Rs.32,500/- and adjusted to the complainant’s loan account and it is the opposite party’s case that the complainant should pay an amount of Rs.4,153/- which is still due. 

        We observe from the record that the appellant/opposite party did not file the loan application of the complainant herein but instead filed Ex.B1, which is a proforma loan application of a third party, of one Mr.Srinivasa Rao.  When the opposite party is relying on the terms and conditions listed in the application and the loan agreement, it is for the opposite party to file the loan agreement signed by the complainant in which the terms and conditions on which they are relying are stipulated.  We also observe from the record that admittedly the loan was taken on 07-6-2007 and as per the appellant/O.P.s contention, one year’s time is given to repay the loan that could be  06-6-2008 and the letter that has been sent by Ex.B3 is undated.  However, the postal endorsement showed the date as 21-10-2008 but admittedly even this notice the complainant has never received.  The opposite party relied on Ex.B4, paper publication which neither mentioned the complainant’s name nor his loan account number and keeping in view that the notice was never served on the complainant and that the paper publication does not have details of either the complainant’s name or the loan account number, we are of the considered view that the complainant was not given sufficient opportunity to pay the loan amount.  It is also pertinent to note that the statement of account showing the instalments paid and the amounts due was not filed.  Since the gold chain was already sold and an amount of Rs.32,500/- has been credited to the complainant’s loan account without giving sufficient opportunity to the complainant, thereby making the complainant loose an opportunity either to enjoy the gold ornament or to sell it at a higher market price which is prevailing even from the date of auction, for which we are of the considered view that the complainant is entitled to a compensation of Rs.25,000/- as the gold chain cannot now be returned.  However, it is also an admitted fact that the said gold chain was auctioned, therefore the direction of the District Forum to return the gold chain is modified and we direct the opposite party to pay a compensation of Rs.25,000/- while we confirm the costs of Rs.1,000/-.   

In the result this appeal is allowed in part and the order of the District Forum is modified directing the opposite party to pay Rs.25,000/- to the complainant instead of return of gold chain as it has admittedly been auctioned while  confirming the costs awarded by the District Forum.

                                                                                Sd/-PRESIDENT.

Sd/-Member.

JM                                                                             Dt.23-11-2012