PER JUSTICE K.S. CHAUDHARI, PRESIDING MEMBER

          This revision petition has been filed by the petitioner against the order dated 12.08.2013 passed by the Karnataka State Consumer Disputes Redressal Commission, Bangalore (in short, ‘the State Commission’) in Appeal No. 1232/2011 –  Axis Bank Ltd. Vs. S. Venugopal Naidu by which, while dismissing appeal, order of District Forum allowing complaint was upheld.

2.      Brief facts of the case are that complainant/respondent purchased Skoda vehicle after availing loan of Rs.15,00,000/- from OP/Petitioner which was to be re-paid in instalment of Rs.32,000/- per month.  He was paying instalments regularly but due to recession in the year 2009, he could not make payment of instalments in time and requested for grant of some more time.  On 13.6.2009, OP forcibly seized the vehicle and on 17.6.2009 pre-sale notice was issued which was received on 19.6.2009. Complainant requested OP not to take coercive steps and he will pay amount.  Complainant also filed a suit for declaration that seizure was illegal.  OP informed complainant that vehicle has been sold in auction on 30.6.2009 for Rs.12,00,000/-.  It was further submitted that OP did not give time to make bid  and it was sold for Rs.6,00,000/- less as market value of the vehicle was Rs.21,00,000/-.  Alleging deficiency on the part of OP, complainant filed complaint before District forum. OP resisted complaint and admitted grant of loan, seizure of sale of the vehicle.  It was further submitted that as complainant failed to pay balance amount inspite of notice, vehicle was sold in auction and prayed for dismissal of complaint.  Learned District Forum after hearing both the parties allowed complaint and directed OP to pay Rs.5,00,000/- with 9% p.a. interest from the date of sale of vehicle and further allowed Rs.10,000/- as cost of litigation.  Appeal filed by the OP was dismissed by learned State Commission vide impugned order against which this revision petition has been filed.

3.      Heard learned Counsel for the parties and perused record.

4.      Learned Counsel for the petitioner submitted that inspite of admitted fact that respondent committed default in making payment of instalments, petitioner well within its rights seized vehicle and sold for highest amount after due notice to the respondent and learned District Forum committed error in allowing complaint and learned State Commission further committed error in dismissing appeal; hence, revision petition be allowed and impugned order be set aside.  On the other hand, learned Counsel for the respondent submitted that order passed by learned State Commission is in accordance with law; hence, revision petition be dismissed.

5.      It is admitted case of the parties that complainant obtained loan of Rs.15,00,000/- from OP which was re-payable in monthly instalments of Rs.32,000/- per month.  It is also admitted by complainant that he could not make payment of monthly instalments for the months of April and May, 2009.  It is also not disputed that OP vide letter dispatched on 3.6.2009 intimated to the complainant that a sum of Rs.96,795/- was overdue in his account and he was asked to pay balance outstanding amount Rs.13,60,398/- within seven days. It is also not disputed that OP obtained possession of vehicle from complainant on 13.6.2009.  As per terms of loan cum hypothecated agreement, OP in the event of any default on the part of complainant was entitled to recover the entire dues of the loan and take possession of vehicle and in the light of aforesaid terms and conditions, OP has not committed any deficiency in taking possession of vehicle on account of default in payment of instalments and overdue amount.

6.      OP vide letter dated 17.6.2009 which was received by complainant on 19.6.2009 asked complainant to obtain release of vehicle after paying Rs. 13,76,769/- within 7 days after receiving this letter.  Admittedly, complainant has not made payment of aforesaid amount within 7 days i.e. upto 26.6.2009. Perusal of record further reveals that advertisement for sale of vehicle was published in paper “Bangalore Mirror” on 24.6.2009 and some persons submitted quotations and by letter dated 30.6.2009 highest bid for Rs.12,00,000/- was accepted by OP for sale of vehicle in favour of Mr. Mohd. Sheriff and amount was deposited by the bidder and vehicle was received by him.

7.      Learned District Forum observed in its order that there was no necessity for the OP to insist to pay the entire amount which was not overdue and it was sufficient if he was insisted to pay the only overdue instalments.  It was further observed that full loan amount was recalled only for the purpose that vehicle cannot be released to the complainant and may be sold to a person of the choice of OP.  Apparently, this finding is contrary to terms & conditions of the loan-cum-hypothecated agreement.  OP was perfectly within its rights to ask for whole of the due amount on default of payment of instalments and OP was within its rights to recover possession of the vehicle on default in payment of instalments and to sell the vehicle.

8.      Learned District Forum also observed that vehicle was sold for Rs.5,00,000/- lesser amount than its actual price  on the basis of  taking depreciation of 10% of the vehicle.  Complainant has not mentioned in the complaint that for how much amount vehicle was purchased. In such circumstances, there was no basis for the District Forum to arrive at a finding that vehicle was sold for a lesser price of Rs.5,00,000/-.  OP in its reply clearly submitted that vehicle was sold to the highest bidder for Rs.12,00,000/- which cannot be disputed at all.

9.      Merely because OP exercised its legal right at the earliest without accepting request for grant of time, no deficiency can be imputed on the part of OP while exercising legal right.  Learned District Forum committed error in allowing compensation and learned State Commission further committed error in upholding order of District Forum and revision petition is to be allowed.

10.    Consequently, revision petition filed by the petitioner is allowed and impugned order dated 12.08.2013 passed by the State Commission in Appeal No. 1232/2011 –  Axis Bank Ltd. Vs. S. Venugopal Naidu and order of District forum dated 4.3.2011 passed in CC No. 1642 of 2010 – Sri Venugopal Naidu Vs. M/s. Axis Bank is set aside and complaint stands dismissed with  no order as to costs.