Dt. 27.01.2016
JAGANNATH BAG, MEMBER
The present appeal is directed against the Order, dated 25.09.2012, passed by the Ld. District Consumer Disputes Redressal Forum, Purba Medinipore , in Consumer Case No. 06 of 2012, whereby the complaint was allowed on contest against the OPs with compensation and cost.
The Complainant’s case, in brief, was as follows:
The Complainant took a loan of Rs. 1,65,000/- from the OP for purchasing a 8- seater Maruti Omni for his own use on condition to repay the same with interest in 48 monthly installments of Rs. 4,760/- each. The Complainant repaid a total sum of Rs. 1,20,720/- up to 20.08.2011. On 08.12.2011 the OP’s men forcefully took the car in their possession. Thereafter, the OP sent a vehicle surrender notice by registered post .A notice dated 13.02.12 was received from Mr. A.Srinivasan, Arbitrator , directing the Complainant to appear at the hearing scheduled at Mumbai on 24.02.2012. He could not attend the hearing as the notice was received at the 11th hour. The OPs did not handover the vehicle inspite of several requests after repossession of the vehicle which was forceful and illegal. The Complainant’s business suffered a lot as the vehicle was taken away. In the circumstances , a consumer complaint was filed praying for direction upon the OPs to return the vehicle and to pay compensation of Rs.30,000/- among other relief including litigation cost of Rs. 1,000/-.
The complaint was contested by the OPs who filed W.V. In their W.V. the OPs denied all material allegations and contended, inter alia, that the Respondent/Complainant was not a consumer as he had purchased the vehicle for commercial purpose and the complaint case was not maintainable in so far as there was no cause of action and as per the Arbitration clause 26 of the Loan Agreement ,the dispute raised by the Complainant was to be decided by the Arbitrator who was appointed for failure on the part of the Complainant / Respondent to pay the installment as stipulated in the Loan - cum-Hypothecation Agreement. It was asserted that there was no deficiency in service on the part of the OP/ Appellants as the vehicle in question was repossessed on the basis of surrender by the Complainant / Respondent after the surrender notice was issued by registered post. The complaint was liable to be dismissed.
Ld. Forum below after having perused the materials on record and upon consideration of the submissions made by Ld. Advocates appearing on behalf of both parties observed that the OP took possession of the vehicle from near the house of the Complainant which is within the territorial jurisdiction of the Forum. Though the office of the OP was situated at Mumba,i no part of cause of action arose at Mumbai. Relying upon the judgment of the Hon’ble Supreme Court in the case of M/s. Fair Air Engineers Pvt Ltd. -vs- N.K. Modi , as reported in Air 1997 SC 533 , Ld. Forum below observed that the District Forum, State Commission and National Commission are judicial authorities for the purpose of Section 34 of the Arbitration Act and by operation of Section 3 of the Consumer Protection Act, those Forums are at liberty to proceed with the matter in accordance with the provision of the Act rather than relegating the parties to any arbitration proceedings pursuant to a contract entered into between the parties. Ld. Forum also observed that the Statement of Accounts submitted by the OPs showed that the Complainant repaid Rs. 1,42,800/- besides payment of Rs. 11,865/- out of Rs. 15,370/- on account of AFC charge . It was also seen that Rs. 11,005/- was realized from the Complainant toward cheque return charge . Further, though OPs filed photocopy of two telegram messages without any date towards taking possession of the vehicle in question, no postal receipt showing service of such telegrams could be produced. No evidence was produced by the OPs showing any order from a court of law to take possession of the vehicle . Considering all material facts and evidence , Ld. Forum below directed the OP to refund a sum of Rs. 1,60,000/-, being the value of the car Rs. 2,25,960/- less depreciation of Rs. 65,960/-, together with Rs. 4,000/- towards compensation for mental harassment and cost of litigation . It was also ordered that the OPs were debarred from realizing any further amount from the Complainant as outstanding dues in respect of the loan account in question. The entire amount was directed to be paid within 45 days from the date of communication of the order, in default , the Complainant would be at liberty to execute the order in accordance with law, in which case the OPs will be liable to pay interest @ 8% p.a. over the total awarded amount from the date of order till full and final settlement.
Being aggrieved by and dissatisfied with the impugned order the OPs- turned-Appellants have come up before this Commission with a prayer for direction to quash the impugned order, dated 25.09.12, with a cost of Rs. 10,000/-.
The memorandum of appeal has been filed together with copies of the impugned order, the application filed referring to Section 8 read with Section 5 of the Arbitration and Conciliation Act 1996, the W.V. filed before the Ld. Forum below , the Loan Agreement, dated 31.08.2009 and some other documents including the Statement of Accounts as prepared on 19.05.2012.
Ld. Advocates appearing for the Appellants and the Respondent have been heard .
Ld. Advocate appearing for the Appellants submitted that it was for the violation of terms and conditions of the Loan-cum-Hypothecation agreement that the notice was issued to the defaulter Respondent/Complainant and copy of notice was also sent to the concerned Police Station for intimation . As per clause 26 of the Loan Agreement , the dispute was to be settled by an Arbitrator and accordingly, an arbitration case was filed. In such situation , the consumer Forum did not have any jurisdiction to try the complaint case as filed by the Respondent /Complainant. Ld. Advocate referred to the decisions of the Hon’ble National Consumer Disputes Redressal Commission as reported in II (2014) CPJ 87 NC , I (2015) CPJ 228 (NC) and also the order of the Hon’ble National Commission as reported in I (2015) CPJ 2044 (NC) in arguing that the claimant being a defaulter on the date of repossession of vehicle by the OPs , there was no deficiency on the part of the OPs as the financier is the real owner of vehicle. Further, it was asserted that the vehicle, after being repossessed on account of default in payment of installments, has been sold after due notice to the Respondent /Complainant. The impugned order suffers from legal infirmity and as such, is liable to be set aside with cost.
Ld. Advocate appearing for the Respondent /Complainant submitted that the substantial amount of the loan taken was repaid and the OP / Appellant without sending any prior intimation took repossession of the vehicle forcefully and illegally . Further, the vehicle was sold out without any service of notice . Such acts on the part of the OP/ Appellants proved deficiency in service which Ld. Forum below rightly observed in adjudicating the complaint case. The notice issued by the Arbitrator asking the Complainant to appear was received so late that it was not possible for the Complainant to appear at the arbitration hearing at Mumbai. Further, as a consumer , the Complainant has the right to seek redressal under Section 3 of the Consumer Protection Act, as there was clear deficiency in service on the part of the OP Appellant which the Ld. Forum below rightly observed and the order was passed taking into consideration all relevant facts and legal aspects of the matter. The impugned order deserves to be up held.
We have perused the materials on record and heard the Ld. Advocates appearing for both parties.
The point for consideration is whether the impugned order suffers from legal infirmity or material irregularity.
Decision with Reasons :
There is no dispute that the Respondent / Complainant took a loan of Rs. 1,65,000/- from the OP for purchasing a vehicle and the loan was to be repaid in 48 installments .
There is also no dispute that the Complainant / Respondent repaid Rs. 1,20,720/- up to 20.08.2011. In terms of the Agreement of Loan-cum-Hypothecation , the OP Appellant filed an arbitration case against the Respondent /Complainant. As the Respondent received the notice at the eleventh hour , he could not attend the hearing to be taken by the Arbitrator .
Inspite of several requests by the Respondent/Complainant, the vehicle was not returned.
The case of the OP / Appellant is that due notices were served to the Respondent/Complainant both at pre-repossession stage and post repossession stage. Ld. Forum below in this connection observed that service of such notices could not be proved by the OP Appellant with any cogent evidence. Accordingly, the repossession of the vehicle was found to be illegal and unfair . Further, Ld. Forum below observed that the Complainant was a consumer as there was no evidence to show that the vehicle was used for commercial purpose, contrary to the averment of the Complainant that the vehicle was purchased for his own use .
It is a fact that the notice of sale of the repossessed vehicle was not received by the Complainant and no proof in support thereof was produced before the Ld. Forum below.
It has been rightly observed by the Ld. Forum below that inspite of arbitration clause in the agreement , the Complainant as a consumer has the right to seek redressal of his grievance under Section 3 of the Consumer Protection Act in tune with the order of the Hon’ble Supreme Court in the case of M/s Fair Air Engineer Pvt Ltd. vs- N.M. Modi, AIR 1997 SC 533.
Ld. Forum below have taken into consideration the Statement of Accounts filed by the OP wherefrom it reveals that the Complainant has paid Rs. 1,42,800/- in addition to Rs. 11,865/- and Rs. 11,005/- towards AFC and cheque return charges respectively.
It is striking to note that the Appellants/OPs have not disclosed the amount of sale proceeds of the vehicle received from its purchaser, which gives rise to an inference that the amount was sufficient enough to recover the outstanding dues against the loan in question, if not more. In that position the Appellants /OPs, not being in a position to return the subject vehicle must refund the sum of Rs. 1,60,000/- as determined by the Ld. Forum below together with litigation cost of Rs. 4,000/-. The direction of the Ld. Forum below to refund a sum of Rs. 1,60,000/- ( value of car Rs. 2,25,960/- less depreciation Rs. 65,960/-) is quite reasonable .
The OPs have been rightly directed not to claim any amount from the Respondent/Complainant in respect of the loan account purportedly lying in the name of the Respondent Complainant.
We find no reason to interfere with the impugned order. The appeal does not succeed. Hence,
Ordered
That the appeal be and the same is dismissed on contest. The impugned order is confirmed. There shall be no further order as regards payment of cost.
