Orissa

Jajapur

CC/20/2017

Paramananda Mahanta - Complainant(s)

Versus

SBI Sukinda Branch - Opp.Party(s)

Badri Narayan Panda,D.K.Nath

09 Jul 2018

ORDER

                IN THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, JAJPUR.

                                                        Present:      1.Shri Biraja Prasad Kar, President

                                                                            2.Sri Pitabas Mohanty, Member,

                                                                            3.Miss Smita Ray, Lady Member.                          

                                                   Dated the 9th day of July,2018.

                                                      C.C.Case No. 20 of 2017

Paramanada Mohanta   S/O Mukunda Mahanta

Vill . Koilo  , P.O. Lombo, P.S.Sukinda   

Dist.Jajpur.                                                                                                                     …………....Complainant .                                                                       

                          (Versus)

 State Bank of India, Sukinda  Branch ,At/P.O. Sukinda

Dt.Jajpur.                                                                                                                  …………………..Opp.Party.                                                                                                                                                     .                                                            

For the Complainant:                                     Sri B.N.Panda,  Sri D.K.Nath , Advocate.

For the Opp.Party   :                                      Sri  P.K.Daspattnaik , Advocate.                                                                                              

                                                                                                      Date of order:   09. 07. 2018.

SHRI  JIBAN BALLAV DAS,PRESIDENT .

Deficiency in banking service is the grievance of the petitioner.

            The facts  relevant as per complaint petition shortly are  that the petitioner is an agriculturist  and to  maintain his livelihood   for the  agricultural activity purchased a Tractor/ Trolly with the financial assistance of O.P for  a sum of  Rs 4,98,000/- vide loan A/C no.304555284849 .As per hypothecation agreement the complainant paid the installment dues regularly  but some time there was  little delay for payment of EMI  and the bank authority imposed  penalty . Thereafter   complainant suffered  from  disease  and was not able to play  the Tractor also  invested  huge amount  for repair .Thereafter he prays  to bank authority to allow  4 months time to pay the arrear  but without giving any prior notice and without allowing  any time the O.P  seized the vehicle on the road on 31.01.12 and after seizure  without  giving any notice also sold  the vehicle without  giving  any presale notice  at a lower price and illegally and arbitrarily demanded Rs 3,98,000/- . Accordingly the petitioner  has filed the present dispute with the prayer to pass appropriate direction just deem fit and proper in the fact and c circumstances of the case.

            After notice the O.P  appeared through their learned counsel and filed the written version  taking the stand:

The case is not maintainable in the eye of law and the complainant  has got no prima facie to initiate such  proceeding.

The case is barred by law of limitation as per C.P.Act.

The petitioner is an agriculturist by  his own profession  and to carry his agricultural  operation approached the O.P bank for financial assistance to purchase a Tractor /Trolly . The O.P Bank sanctioned agricultural term loan amount of Rs.4,98,000/-  in favour of complainant to purchase a Tractor /Trolley .After security  of documents in  banks standard format  and after creation of equitable  mortgage ,  money was advanced  for purchase of Tractor /Trolley  etc .  It was  mutually agreed between the petitioner and O.P  Bank   that the loan amount will carry at the rate of 13.25 % interest with half yearly rest and the loan amount would be repaid on 18 equal half yearly installment of Rs. 27667/-  for  each installment but the petitioner could not repaid the loan amount in due time .

            Further instead of several approach  demand notice was issued by the field function arises of the O.P  bank  to regularize the loan account but the petitioner has substantially failed to do so  . As such  the O.P  bank has no alternative choice other than  lawfully  to seize  the hypothecated articles .  After seizure of the hypothecated  Tractor ,  it was kept in stock yard for its safe upkeepment  .Thereafter      the field function arises of the  O.P Bank  made contact with the complainant and approached  to regularize the loan account but he did not turned up.  Accordingly after due compliance of the statutory formalities the O.P Bank auctioned the Hypothecated Tractor in a public auction and the amount received from the process of auction has been deposited in the loan account of the petitioner .After adjustment  the O.P bank is now entitled to realize an amount of Rs. 792545.00/ from the petitioner  and the interest on the said amount has been calculated up to 23.10.2011. Besides this loan petitioner has availed  a KCC loan from O.p bank for which the petitioner is laible  to pay Rs. 55467.00/  Hence finding no other alternative the O.P  Bank has filed Civil Suit before the Court of Civil Judge( Sr. division ) Jajpur Road for realization of the loan amount .Hence the O>P bank is no way deficient to provide any services to the petitioner rather the petitioner has been  substantially failed to perform his duty in this regard . As such the dispute is liable to be dismissed with cost.

            On the date of hearing we heard the argument from  the learned adv  of the  petitioner and after perusal of the record and documents in detail we observed that :

It is undisputed fact that the petitioner has  purchased the tractor and Trolley  with the financial assistance of the O.Ps.

2 It is also undisputed fact that the petitioner is a chronic defaulter for repayment of loan dues of the o.ps .Thereafter the O.P repossessed the alleged vehicle on 08.09.12 and subsequently sold  the same. After adjustment  of the same amount of the alleged vehicle now the O.Ps  are  demanding  Rs.7,91,934/- from the

petitioner including interest till 30.1.12 and for  this purpose  the O.P  bank has filed the Civil Suit before    Civil Judge, Sr. division ..

                There are vital issues raised by the petitioner that the O.P  has illegally seized the loaded vehicle by using muscle man . As again  such grievance of the petitioner the O.ps have taken the stand  that since the petitioner is  a chronic defaulter and did not repay the loan amount in time ,  the  O.P  was entitled to seize the vehicle .Thereafter the O.P sold  the vehicle by following  due procedure as per law .On the above allegation and counter allegations we are on opinion that the O.P  is  entitled to exercise its  right since the petitioner is a chronic defaulter to repay the loan amount in time .

                Further it is alleged by the petitioner without giving any repossession and pre sale notice the O.P  after repossessing  the vehicle had sold the alleged vehicle at lower price . As against such grievance the petitioner,  the O.ps have taken the stand that the o.ps have issued the notice to the petitioner for repayment  of outstanding dues but the petitioner remained  silent after receipt of the repossession notice . On the other hand the petitioner categorically  denied to  the plea of the O.Ps .Owing to such situation we do not come across with  a single scrape of paper which will support that  the O.P has issued  such   pre sale notice and  since the O.P did not file  the  postal receipt  though  several opportunity given by this Fora  for filing  the same . It is also surprised  that the o.ps are silent about the date of auction of the vehicle as well as procedure adopted by the O.Ps in auction of the said vehicle and the actual price of the vehicle and   the o.ps have also not intimated to the petitioner in which date the vehicle will be put to  auction sale . As a result the petitioner  lost the opportunity to participate in auction and to take part to purchase the vehicle . In our opinion if the O.Ps ought to have initimated the date of sale of the vehicle to the petitioner so that he would have been able to participate the auction  . Besides  that it is further alleged by the learned counsels  for the petitioner  that the petitioner  has not been  intimated  that the O.ps  are going to  dispose of the vehicle by way of auction since no notice was sent to him regarding auction sale of the vehicle. There is no public notice given by the o.ps in news paper before selling the vehicle .  Thereafter it can not be said  that  the vehicle was sold by following a fare and transparent  process .  This was not only another act  of deficiency on the part  of the O.Ps  rendering  service to the petitioner but also unfair trade practice .

The next aspect comes for consideration is whether the ,mode of seizure and sale of the alleged vehicle is tenable in eye of law .

                                In this contest after perusal of the observation of Hon’ble Supreme Court reported in 2006-CTJ-209 (SC)( M.D Orix Auto Vrs. Josvinder Singh)  we are inclined to hold that though the O.P. is empowered as per term and condition of the agreement to seize and sale the financed  vehicle in case of default of monthly installments of the loan but such seizure and sale must be as per law in view of the observation of Hon’ble National Commission reported in 2016(2)CLT-31-N.C (A.V.Finance India Pvt.Ltd Vrs.Ramdas Raghunath Patil) wherein it is held   by the of Hon’ble Supreme Court reported in 2007(36) OCRCSC (Manager ICICI Bank Ltd Vrs. Pravash Kour & Others) 2016(1)CLT-310-N.C(Kotak Mahindra Bank Ltd Vrs.M.D. Sarif Ansori)  wherein it is held that:

                                “ vehicle repossessed and sold by financer without notice illegal “.

                                In this contest we make it clear that no wherein  the hypothecation agreement of the alleged vehicle empowers,   the O.P to take such action violating the guide line of Hon’ble Supreme Court ,Hon’ble National Commission and Hon’ble State Commission Delhi reported in 2012(2)-CLT-72-SC, 2007(3)CPR-191, 2005-CTJ-522 respectively (Citi Crop Maruti Finance Ltd Vrs.Vijaya Laxmi) wherein it is held that:

                                “ Seizures  of the vehicle must be through court.”

                                “Repossessed vehicle can not be sold without notice to owner”.

                                           and

  2016 (2)CPR-342(N.C) (General Manager L & T Finance Ltd Vrs. Rampada  Maity) wherein it is held that:

                                “repossessed vehicle must be sold by following a fair and transparent process.”

Similarly we are also inclined  to verify whether the selling of the above vehicle was a bonafide one. In this contest it is alleged by the petitioner that without giving an opportunity to the petitioner,  the O.Ps.  have  sold the vehicle at their sweet will. In such situation we do not  come across with any   documents from the side of O.Ps  regarding the date of auction of the said vehicle which violates the  guide line of appellate  Forums reported in 2010(1) CPR-118-A.P,2004(3) CPR-154-Odisha, wherein it is held that:

‘Auction  sale must be bonafide one and date of auction of vehicle must be intimated to hirer / loanee .  

And

2006-CPJ-438-Chhatisgarh State commission   (Bikram sah thakur  vrs. I.C.I.C.I Bank ) wherein it is held that    

Vehicle sold without issuing pre-sale notice to complainant deficiency in service proved –o.p liable to refund the entire amount paid by the complainant”.

2008(3) –CPR-45-N.C(Tata Finance ltd, Vrs. francies  Soeiro )

2015(2)-CPR-584-N.C(Magma finance ltd. Vrs Tikeswar Barik) wherein it is held that :

                                “ Financer can not resort to extra legal means to repossess vehicle “.   

       2015 (2)CPR-901(S.C) ( Citi  Crop Maruti Finance Vrs. S.Vijay  Laxmi) wherein it is held that :

“ even in case of mortgage goods subject to hier purchase agreement recovery process has to be in accordance with law “.

And 2015(2) CPR-375 N.C   STIFAN  Tigga  Vrs. Cholomondalam Investment and Finance ltd, wherein it is held that :

“Financer can not  resort to extra legal means to recover loan amount “.

In view of the above observation from our side it is crystal clear that the O.P have committed gross negligence and patient deficiency of service as well as unfair trade practice by selling the above vehicle without following the proper procedure of law  for which the petitioner suffered irreparable loss . Accordingly  the law is conclusively in the petitioner’ favour and consequently the dispute must succeed and hereby allowed.

Hence this order.

                In the net result the dispute is allowed against the O.P   on contest as per observation of our own  State Commission  in vide C.C. Case no 76/2007.   The O.P  is directed  not to recover any  outstanding amount if any against the alleged vehicle from the petitioner . No cost

                                 

This order is pronounced in the open Forum on this the 9th day of July,2018 under my hand and seal of the Forum.