Orissa

Jajapur

CC/02/2014

Sri Kailash Ch.Das - Complainant(s)

Versus

Shri Ram Transport Finance Co.Ltd - Opp.Party(s)

Srikanta Mohapatra,Seetikanta Das

03 Feb 2017

ORDER

                IN THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, JAJPUR.

                                                        Present:      1.Shri Jiban ballav Das , President

                                                                            2.Sri Pitabas Mohanty, Member,

                                                                            3.Miss Smita Ray, Lady Member.                         

                                                    Dated the 3rd day of February,2017.

                                                      C.C.Case No.02 of 2014

Sri Kailsh Ch.Das  S/OLate Saatana Das

Vill. Dubagadia  , P.O/P.S. Dharmasala

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

                   (Versus)

1.Shriram Transport Finance Co.Ltd,Turndar Morrison Building 1^st floor

    61 yors Range,Kolkata.

2.Shriram Transport Finance Co.Ltd, 2^nd floor,Geetanjali Complex

  Lewis Road,Bhubaneswar, Dt.Khurda .

3.Shriram Transport Finance Co.Ltd, Near Axis Bank, 2nd Floor ,

Chandikhole, Dist. Jajpur

                                                                                                                       ……………..Opp.Parties.                  

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

For the OPP.Parties :No.2                                 Sri Jyoti Patnaik, Sri R.K.Sahu,Advocates.

For the Other OPP.Parties.                               None                            .

                                                                                                        Date of order: 03.02.2017

SHRI JIBAN BALLAV DAS , PRESIDENT.                                                                    

                        Deficiency in finance service is the grievance of the complainant.

                                The facts  stated by the petitioner in the complaint petition in short is that, the petitioner purchased a Truck bearing Regd. No.0R-09-J-5576 to maintain his livelihood taking financial assistance from the O.P under Loan-Cum-Hypothecation Agreement No.BHUBA0003300004 . The total value of     the vehicle is Rs.11,81,276/- and accordingly the petitioner has  paid down payment of Rs.1,21,676/- and thereafter he has paid the installment dues regularly. According to the  petitioner  he has already paid a sum of Rs.11,55,9.66/- towards loan  amount of Rs.11,81,276/-  but without giving any information suddenly the O.P   seized the vehicle  on dt.05.09.11 loaded with metal  . The cost of  the metal ore is Rs.30,000/-.

                                Thereafter the petitioner contacted with the concerned authority of the O.Ps to settle the matter amicably and release the vehicle but despite  all efforts  the authority of the O.P  neither released the vehicle nor settled the dispute .  Lastly the O.P issued a defaulter notice to pay Rs.1,18,531/- on dt.28.07.2011  .  It is alleged by the petitioner that  without serving  prior  notice, the O.Ps. has  seized the vehicle on the road and again illegally issued legal  notice demanding further Rs.7 lakh with threaten to impose penalty of 35% per annum which is illegal, unjustified , improper  and violate the  principle of natural justice.

                                Accordingly finding no other way the petitioner knock the door of this  Fora with the prayer to direct the O.Ps to release the vehicle as well as rectify the outstanding dues  against the  petitioner .

                                After appearance the O.Pno.2 has  filed their written version. O.P.no.1 and 3 have been set-exparte  vide order dt.16.07.14.

                                The O.P.no.2 has taken the following the pleas which are stated below :-

1.There is no cause of action for the petitioner   to  move such a complaint.

2.The alleged repossession was on 05.09.2011 and the complaint has been filed beyond the period of limitation.

3.That the seized vehicle was sold after providing opportunity to the complaint towards clearance of his outstanding dues. Therefore release of vehicle and  re-fixation  of  EMI does not arise.

4.The repossession of the hypothecated asset by the financer was proper, justified and lawful and that the said repossession was done in consonance with the terms of contract. The complainant having allowed the contract to operate, justifiability of repossession can not be questioned. The complainant turned to be a defaulter, which is contravention of terms of contract, and the O.P financier was authorized under the contract to repossess and sell the hypothecated asset in the event of default committed by the borrower. So there is no illegality or irregularity in seizing the vehicle bearing Regd. No.0R-09J-5576.

5. In the  notice dt.31.08.2013 , there was outstanding dues of Rs.7,13,507/- only under the Loan-cum-Hypothecation Agreement No.BHUBA0008300004, payable by the complainant and under the said notice,

the complainant was asked to pay the entire sum within the period indicated therein, failing which the dispute shall be referred for Arbitration as per terms of contract. The complainant did not respond to the said notice and now questioned the correctness thereof after lapse of long time. Moreover, the notice is short fall notice, which was required to be complied by the borrower.

                                The O.P further stated in their written version that any dispute arising out of a contract between the parties needs to be settled through arbitration as has been provided under the contract and the notice was rightly issued and served on the complainant. So, instead of seeking remedy under the Consumer Fora at belated stage, it would have been  proper and justified on the part of the complainant to participate in Arbitration proceeding and get his dispute settled. The complainant never did it, rather preferred consumer complaint ,wherein the  Forum lacks power to decide financial dispute.

                                Hence the complaint is liable to be dismissed being  devoid of merit.

                                On the date of hearing we heard the learned advocate from the side of the petitioner  and the O.Ps. are absent . Hence they have been set-expartee .  After perusal of the record along with the documents in details the following issues are framed :-

Issue No.1

                                Whether the petitioner is a consumer who is entitled to maintain the dispute in this Fora ?

Issue No.2

                                Whether this Fora  gets jurisdiction to adjudicate the present dispute on the issue  limitation?

Issue No.3

                                Whether this Fora gets jurisdiction to adjudicate the present dispute  as per   Arbitration Clause ?

Issue No.4

                                Whether there is deficiency in service on the part of the O.Ps so far as seizure and sale of  the alleged vehicle is concerned if so?

Issue No.5

                                Whether the petitioner is entitled for any relief ?

                                It is in the initial stage we make it clear that we are going to decide  the dispute as per fact and circumstances of the  present dispute as per observation of Hon’ble Supreme Court reported in 2001(2)CPR-108-S.C

Answer to issue no.1

                                It is undisputed fact  that the complainant has availed the  loan  from the O.P . As against such loan the complainant is paying interest which is consideration and  in the  expression of service  . As such the complainant is a consumer as per observation of Hon’ble Supreme Court reported in 1995(2) SCC-150-SC ( Consumer Unit & Trust Society Vrs.Chairman and M.D Bank of Baroda, 11(2000) CPJ-11S.C (Vimal Chandra Grover Vrs. Bank of India) .

Answer to issue no.2 :-

                                The stand taken by the O.P. vide para-2 of the written version that present dispute is barred by limitation as provided under C.P . Act. It is our considered views that the cause of action arises i.e. on dt.31.08.2013  when the O.P. send the legal notice to the petitioner for payment of Rs.7,13,507/- within 7 days  . There after the petitioner  has filed the present dispute against the O.P i.e on dt. 04.01.2014. As such the dispute is within the period of limitation as per section 24 of C.P. Act 1986.

Answer to issue No.3

                                The view taken by O.P.no.2 that as per agreement this dispute shall be adjudicated by Arbitrator but not in this Fora is also not sustainable in view of Hon’ble Supreme Court reported in 2004-CTJ-1-S.C (Secretary Co. op Agriculture Society  Thirunugam Vrs. M.Lalitha) wherein it is held that:

Arbitration clause is no bar for entertaining  the dispute by the Consumer  Fora.  As such this Fora   has no   hesitation to decide the present dispute”.

Answer  to issue no.4 and 5        

                                                These are vital issues where  we have to verify whether there is any deficiency in service on the part of the O.P. and if so whether the petitioner is entitled for the relief as prayed in his complaint petition .

1. It is alleged by the petitioner that on 05.09.2011  the O.P.  unauthorizedly and illegally has seized the loaded vehicle .

As against such grievances of the petitioner, the O.Phastaken the stand that since the petitioner was a chronic defaulter and did not repay the loan in time , the O.P was entitled to seize the vehicle .

 On the above allegation and counter allegations we are of the opinion that the O.Ps. are entitled to exercise its right because the petitioner is a defaulter.

2. Further  it is alleged by the petitioner that without giving repossession and pre sale notice the O.P after repossessing  the O.P  has sold the alleged vehicle.

                                                 As against such grievance of the petitioner, the O.P has taken the stand that the O.P has issued notice for  repossession as well as in default to sale the vehicle  so also has given  opportunity to release the alleged vehicle on or before it’s  sale  but the borrower did not turn up . Hence, the vehicle was put to sale. On the other hand the petitioner  categorically denied the plea of the O.P. Owing to such situation the O.P. has not produced  any documents like postal receipts in support of pre-sale notice  instead of several opportunity and the O.P.no.2 also took time on dt.06.01.15 and 02.03.16  to  produce the same as instructed by this Fora . It is also surprised that the O.P is silent about the date of auction of vehicle  as well as the  method  which has been adopted by O.P in auction  of  the said vehicle and the actual  auctioned price  of the said vehicle  . The O.Ps. also have not intimated  the petitioner on which date the alleged vehicle shall be put to auction sale.  As a result the petitioner  lost  an opportunity to take part in the  bid to purchase the vehicle repossessed from him. In our opinion the O.Ps. ought to have intimated the date of intended sale to the complainant so that he would have been  able to participate in the said sale process.

                                There is no evidence of any public notice having being given by the O.Ps. in a news paper before selling the vehicle repossessed from the complainant . Therefore , it can not be said that the vehicle

was sold  by  following a fair and transparency  process. This was not only  another act of deficiency on the part of the O.Ps. in rendering service to the petitioner but also patient and  unfair trade practice.

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

                                We also verified 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 that:

                                “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.P. has  sold the vehicle at their sweet will. In such situation we do not find 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 .      

                                In view of the above observation from our side it is cristal clear that the O.P. has committed gross negligence and patent deficiency in service as well as unfair trade practice by selling the above   vehicle without following the proper procedure of law for which the law is conclusively in the complainant’s favour and consequently the dispute must  succeed and hereby allowed.

O R D E R

                         In  the  result  the dispute is allowed against the O.Ps.  The O.Ps are debarred  not to recover the outstanding loan amount if any  from the petitioner . Further the O.Ps. are directed to pay Rs.50,000/- (Fifty thousand ) as compensation to the petitioner within one month from the date of receipt of this order , failing which the petitioner is at liberty to take shelter of this Fora for realization of this awarded amount. No cost.

 

This order is pronounced in the open Forum on this the 3rd day of February,2017. under my hand and seal of the Forum.                                                                                             

 

                                            

                                                                                                

          .