DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II

U.T. CHANDIGARH

[Consumer Complaint Case No: 568 of 2011]

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              Date of Institution : 13.12.2011

                   Date  of Decision   : 07.09.2012

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Balwinder Singh Dhillon s/o Kartar Singh, r/o H.No.2559, Sector 50-C Chandigarh.

                                  ---Complainant

VERSUS

[1]  State Bank of India Mutual Funds, Address, near K.C. Cinema, Sector 17, Chandigarh.

[2]  State Bank of Patiala, High Court Branch, High Court, through its Manager.

[3]  Computer Age Management Services (P) Lts. Unit: SBI Mutual Fund, 148, Old Mahabalipuram Road (Adjacent to Hoter Fortune), Okkiyam Thuraipakkam, Chennai – 600097.

---Opposite Parties

BEFORE:  SH. LAKSHMAN SHARMA           PRESIDENT

         MRS.MADHU MUTNEJA              MEMBER

         SH. JASWINDER SINGH SIDHU     MEMBER

Argued By:    None for Complainant.

Sh.Gaurav Bhardwaj, Counsel for Opposite Parties No.1 & 3.

Sh.Kuldip Singh, Counsel for Opposite Party No. 2.

PER JASWINDER SINGH SIDHU, MEMBER

1.      Complainant has filed the present complaint, against the Opposite Parties on the ground that he invested a sum of Rs.1,00,000/- by subscribing for SBI Mutual Fund in the year Feb., 2008, and the same was to mature on 31.3.2011. The Complainant paid the said amount through the SBOP, High Court Branch vide Cheque No. 494761 dated 31.1.2008, a copy of acknowledgment is annexed as Annexure C-1. The Complainant’s account no. was mentioned in the application form as per its requirement. It was agreed between the parties that the maturity amount as on 31.3.2011 would be credited in the account of the Complainant as and when the same became due. A letter in this regard was received by the Complainant from Opposite Party No.3 and the same was sent to Opposite Party No.2, with an application, for necessary action. The summary of account is annexed as Annexure C-2.

        The Complainant to his utter surprise found that an amount of Rs.1,10,000/- alone and that too in the month of May, 2011, was credited instead of Rs.1,35,000/- approx. as per the assurance, which was due on 31.3.2011. Copy of bank statement is at Annexure C-3. The Complainant approached the office of Opposite Party No.2 to inquire about the huge variation in the projected amount and the amount that he received, but Opposite Party No.2 failed to convince the Complainant in a satisfactory manner.

        The Complainant claims that he had suffered a pecuniary loss on account of negligence and deficient services on the part of the Opposite Parties and claims that he be compensated by the Opposite Parties by seeking a relief of Rs.35,000/- along with interest @18% p.a., along with counsel fee, for causing harassment to the Complainant.       

        The complaint of the complainant is duly supported by his short affidavit.

2.      The Opposite Parties No.1 and 3 have contested the claim of the complainant by filing their joint reply, taking preliminary objections to the effect that the averments of the present complaint are denied to the extent than those which are specifically admitted in their version. It is also mentioned that the Complainant has not submitted full facts of the case, and is hiding material facts from this Forum, and that there has been no error or omission on the part of the answering Opposite Parties, thus, there is no cause of action that would invoke the jurisdiction of this Forum.      

        On merits, the Opposite Parties No.1 & 3 have repeated their preliminary objections, while replying to the averments of the present complaint, in their para-wise reply. The answering Opposite Parties claim that the Complainant made an investment of Rs.1,00,000/- in NFO Scheme with investment details as Folio No. 10855367, with the scheme name as “SBI Tax Advantage Series-I Dividend” and the number of units for the amount invested are 10,000/-. The allotment date of this scheme fell on 31.3.2008 and the units allotted to the Complainant for the applicable NAV. The redemption of units was received at their end on 13.4.2011; the same could not be processed as the signatures of the Complainant were not tallying with the original ones. An intimation letter was sent to him on 13.4.2011 (Annexure-I) and after receiving a fresh requested dated 16.5.2011 with duly attested signatures by the Bank Manager, same was processed, and the applicable NAV i.e. on 16.5.2011, redemption proceeds of Rs.1,10,124/- were directly credited to SB Account No. 65019100671, State Bank of Patiala, Chandigarh. The request of redemption dated 16.5.2011 is annexed as Annexure-II. Further more, the investment made by the Complainant was according to the offer document wherein no such claim was made that the Complainant had alleged. The clause related to the liquidity of the offer letter clearly mention at Pg.10 under the heading liquidity as below: -

“The Scheme will offer redemption/ Switch out on every business day at NAV based prices after the lock-in period of three years from the date of allotment.

“Open-ended Scheme” means a scheme of a mutual fund which offers units for sale without specifying any duration for redemption;”

Copy of offer document and application are annexed as Annexure-III and IV.

        In reply to para 4 of the complaint, the answering Opposite Parties have again categorically stated that on receipt of intimation for redemption dated 16.5.2011, with duly attested signatures, the same was processed, and redemption amount of Rs.1,10,124/- was credited in the SB Account of the Complainant, maintained with SBOP, Chandigarh.     Furthermore, the amount credited was as per NAV applicable on 16.5.2011, and the claim of the Complainant of an amount of Rs.1,35,000/- is out rightly denied. It is further stated that the Complainant had himself signed the offer document, wherein the redemption price is explained as below:-  

“Redemption Price: The redemption price under the Scheme will be arrived which will be in line with SEBI formula as under:-

        Redemption price = Applicable NAV

        *(1 – Exit Load, if any).

        The answering Opposite Parties have denied the contents of Paras 5, 6, 7 and 8 as totally wrong and further more, did not prefer to answer Para 9 and 10 of the complaint, as the same not deserving any reply from the answering Opposite Parties.  Thus, claiming no deficiency in service or unfair trade practice on their part, the Opposite Parties No.1 and 3 have prayed for the dismissal of the complaint with heavy costs.  

        The reply of the Opposite Parties No.1 & 3 is duly supported by detailed affidavit of Sh. Jasmeet Singh Bedi, Relationship Manager, SBI Funds Management Ltd.

3.      The Opposite Party No.2 has contested the claim of the complainant by filing their reply, taking preliminary objections to the effect that no cause of action arose in favour of the Complainant to file the present complaint, as there is no deficiency in service on the part of answering Opposite Party No.2. It is further mentioned that the present complaint is not maintainable being a 2^nd complaint on the same cause of action and on the ground that the initial complaint of the Complainant was dismissed in default, as the Complainant has himself failed to put in appearance on 11.11.2011. In the absence of any restoration application, and the orders of this Forum to that effect, the present complaint is not maintainable in its present form.

        On merits, the Opposite Party No.2 has repeated their preliminary objections, while replying to the averments of the present complaint, in their para-wise reply, denying each and every allegation of the Complainant as none of them pertained to any deficiency in service on the part of the answering Opposite Party. The Opposite Party No.2 claims that the amount credited in the account of Opposite Party No.1 as well as crediting the proceeds (maturity amount), if the account of Opposite Party No.2 has not been contested by the Complainant. Furthermore, the contents of para 4, 5, 6, 7, 8, 9 and 10 are claimed to be wrong, the same deserving no reply from the answering Opposite Party. Thus, claiming no deficiency in service or unfair trade practice on their part, the Opposite Party No.2 has prayed for the dismissal of the complaint with heavy costs.  

        The reply of the Opposite Party No.2 is duly supported by detailed affidavit of Sh. Jagmohan, Branch Manager.

4.      As the Complainant failed to appear on the last date of hearing i.e. 31.08.2012, the arguments of the counsel for the Opposite Parties were heard. Hence, in the absence of the Complainant, we have proceeded to dispose of the present complaint on merits under Rule 4(8) of the Chandigarh Consumer Protection Rules, 1987, read with Section 13(2) of the Consumer Protection Act, 1986 (as amended upto date), vide order dated 31.08.2012.

5.      Having gone through the entire complaint, version of the Opposite Parties, the evidence of the parties and with the able assistance of the learned counsel for the opposite parties, we have come to the following conclusions.

6.      The main allegation of the Complainant as mentioned in para 3 of the complaint is that as per the understanding between the parties, it was the responsibility of SBI Mutual Fund (Opposite Party No.1) to credit the maturity amount on 31.3.2011, along with the value unit which was due on 31.3.2011 [approx. Rs.1.35 lacs] However, in reply to this, the Opposite Parties No.1 and 3 claims that there was no such understanding to credit back the investments made by the Complainant on 31.3.2011. The investment was made in accordance with the offer document and there was no such claim. Furthermore, the liquidity clause in the offer letter mentioned in Pg. 10 under the heading liquidity has been reproduced in their reply. And furthermore, the Complainant‘s application itself proves that he has read and understood the contents of offer document. The copy of offer document (relevant Pgs. No. 10 & 50) is annexed as Annexure-III and IV.     

        We have gone through Annexure IV (Pg.19), which is the application form submitted by the Complainant and the same is numbered as TA 9781479, through which the Complainant has subscribed for the SBI Tax Advantage Fund product of the Opposite Parties No.1 and 3. The very first line of this document clearly mentions that This booklet consists of 16 pages including the application form. Please ensure that you have all the pages. The Opposite Parties No.1 and 3, while tendering this document have only annexed two pages and the remaining have been retained by them. No reason has been mentioned by the Opposite Parties as to why the entire 16 page booklet that the Complainant had signed himself has not been brought on record, to prove that the Complainant was in the know of each and every term and condition referred in this document. It is also surprising to note that the clause under title “redemption & re-purchase” is numbered as Pg. No.50, annexed by the Opposite Party. There is no explanation from the side of the Opposite Parties No.1 and 3 that if this document too was made available to the Complainant and explained that the redemption of the investments made by the Complainant would be in a manner explained in this document. The reply of the Opposite Parties No.1 & 3, which is submitted under the signatures of Sh. Jasmeet Singh Bedi and the affidavit too has been signed by him in that capacity, does not mention that he himself was in the knowledge of the happenings that are claimed by the complainant, at the time of subscription by the Complainant for the said SBI Bonds and as the Opposite Parties NO.1 & 3 have preferred to bring on record the documents in their possession, in bits & pieces, we feel that there is a lot more that meets the eyes and the answering Opposite Parties No.1 & 3 do not want to bring that to the knowledge of this Forum. Thus, in these circumstances, the reply to the averments of Para 3 of the complaint, are incomplete as the document mentioned at page 19 numbered as 50 was ever supplied to the complainant is not made clear hence the same cannot be believed.        

7.      The Complainant in order to substantiate his claim about the value of the Bonds subscribed by him, has brought on record Annexure C-2, Page 8, and the same is a statement of account, wherein, the N.A.V. as on 31.3.2011, is shown as 11.72; and further more, the current value under the heading Portfolio Summary is mentioned as Rs.1,17,200/-. Meaning thereby, that the value of the investments made by the Complainants were actually Rs.1,17,200/- on 31.3.2011. This document belongs to the record of the Opposite Parties No.1 and 3 alone.           

        The answering Opposite Parties No.1 and 3, while claiming that the amount of Rs.1,10,124/- redeemed in favour of the Complainant on 16.5.2011, were actually as per the N.A.V. prevailing on that date. However, the Opposite Parties No.1 and 3, in order to substantiate their claim, could have brought on record a similar statement of account, of even date, but the Opposite Parties No.1 and 3 have preferred not to bright any document on record, so as to prove that their submissions, in para 4(a) of their reply are correct, as per their records.  Hence, in these circumstances, the submissions as made in Para 4(a) on merits, not being supported by relevant records, of the answering Opposite Parties No.1 and 3, cannot be believed, and the same are ignored.   

8.      As the contents of the complaint do not raise any allegations towards Opposite Party No.2, we feel that Opposite Party No.2 was only impleaded as necessary party to prove the payment as well as receipt of the redemption money by the Complainant; and on not finding any fault on the part of Opposite Party No.2, the present complaint qua them is dismissed, without costs.

9.      In the light of above observations, we find a definite deficiency in service on the part of the Opposite Parties No.1 and 3. The present complaint of the Complainant succeeds against the Opposite Parties No.1 and 3, and is allowed. Hence, the Opposite Parties No.1 and 3 are directed, jointly & severally, to:-

[a]  Pay a consolidated amount of compensation to the tune of Rs.10,000/- on account of deficiency in service and causing mental harassment to the Complainant;

[b]  To pay Rs.5,000/- as cost of litigation;

10.     The above said order shall be complied within 45 days of its receipt by Opposite Parties No.1 & 3; thereafter, they shall be liable for an interest @18% per annum on the amount mentioned in sub-para [a] of para 9 above, apart from cost of litigation of Rs.5,000/-, from the date of institution of the present complaint i.e. 13.12.2011, till it is paid.  

11.     Certified copy of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced  

07^th September, 2012

Sd/-

(LAKSHMAN SHARMA)

PRESIDENT

Sd/-

(MADHU MUTNEJA)

MEMBER

Sd/-

 (JASWINDER SINGH SIDHU)

MEMBER