Date of Filing: 07.03.2015
Date of Order: 18.12.2018
BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM – I, HYDERABAD
P r e s e n t
HON’BLE Sri P.Vijender, B.Sc. L.L.B. PRESIDENT
HON’BLE Smt. D.Nirmala, B.Com., LLB., MEMBER
Tuesday, the 18th day of December, 2018
C.C.No.122/2015
Between
Sri Vemireddy Jithender Reddy,
S/o. V.Venkat Reddy,
Aged about 44 years, Occ: Business, Indian,
Presently residing at Flat No.204,
Durga Enclave, Rock Town Colony,
Mansoorabad, Hyderabad. ……COMPLAINANT
And
- Shriram Chits Private Ltd.,
3-6-629, 1st Floor, Opp. Petrol Bunk,
Himayatnagar ‘X’ Roads,
Himayatnagar, Hyderabad – 500029.
Rep. by its Foreman / Branch Manager
- Shriram Chits Private Ltd.,
Regd. Office 44, SD Road,
Secunderabad – 500033.
Rep. by its Managing Director …..OPPOSITE PARTIES
Counsel for the complainant : M/s. K.Visweswara Rao
Counsel for the Opposite Parties : Sri M.Indrasen OP.Nos.1 & 2
O R D E R
(By Hon’ble Sri P.Vijender, B.Sc., LL.B., President on behalf of the bench)
1. This complaint is preferred under section 12 of Consumer Protection Act, 1986 seeking an amount of Rs.2,51,713/- as the said amount is stated to be due to the complainant from Opposite Parties and for a further direction to furnish the monthly statement of account ledger extract and other chit related documents and for a compensation of Rs.50,000/- for mental agony suffered by complainant and a sum of Rs.20,000/- towards costs of this complaint.
2. The complainant’s case in brief is that, he joined a subscriber with the Opposite Party No.1 in chit bearing No. HXYZ 14/42 agreeing to subscribe Rs.50,000/- per month for a chit value of Rs.25,00,000/-. He paid 15 subscriptions and by including dividend the amount paid by him comes to Rs.7,50,000/- but, the Opposite Party No.1 has not furnished details, statement of accounts and it’s representative is not intentionally coming to collect the subscriptions. Hence, he stopped payment of further subscription however, an amount of Rs.7,50,000/- remanded to his credit in chit account.
3. Earlier the complainant also subscribed a chit bearing No. HLS 05/21 for a Chit value of Rs.10,00,000/- which was commenced in December, 2009 and completed in January 2014. He participated in the auction held on 23.07.2010 and became successful bidder having agreed to forgo an amount of Rs.4,00,000/-. An amount of Rs.6,00,000/- was payable to him towards prize amount. He submitted required sureties for release of the chit amount on the next day of the auction. The opposite parties are expected to scrutinize the sureties and release the bid amount within a maximum period of one month under the provision of Chit Fund Act. But Opposite Parties delayed it abnormally and insisted on him to subscribe a some of Rs.1,00,000/- for a Life Insurance Policy with their sister concern M/s. Shriram Ujval Life Insurance and forcibly delivered a policy for Rs.1,00,000/-. He participated in the bid as he was in dire need of money agreeing to forgo huge amount of Rs.4,00,000/- for that purpose. But because of indifferent attitude the very purpose of participating in the auction was lost. By insisting upon him to obtain Life Insurance Policy from their sister concern opposite parties have indulged in restrictive trade practice. An amount of Rs.4,00,000/- was released to him on 21.10.2010 i.e three months after participating in the auction after deducting Rs.1,00,000/- towards Life Insurance Policy. He continued to pay the amount to the said chit up to 01.10.2012 and by then total amount paid including dividend accrued to him was Rs.5,00,000/-. He received only Rs.5,00,000/- after the total chit value of Rs.10,00,000/- and the balance amount payable according to the Opposite party itself is Rs.3,73,287/- in respect of Chit bearing No. HLS 05/21. From the amount of Rs.7,50,000/- a sum of Rs.25,000/- was deducted towards Foremen commission. He requested to pay balance amount of Rs.2,51,713/- to him but Opposite Parties did not pay the amount inspite of reminders and demands. On the other hand as a counter to his requests and demands opposite parties filed a false suit before Deputy Registrar of Chits claiming an amount of Rs.3,73,287/- as due without referring to his chit bearing No.HXYZ-14/42. The complainant is strongly defending the said suit.
4. When the Opposite Parties did not respond to his reminders the complainant got issued a legal notice on 13.11.2014 to opposite party No.1 asking to furnish all the documents and statement of account pertaining to chit bearing No.HXYZ-14/42 monthly statement of account with Ledger extract. Opposite Party No.1 having received the said notice did not respond even after lapse of four months’ time.
5. Opposite party No.1 is payable Rs.5,41,525/- including dividend accrued to him the amount which works out at Rs.7,50,000/- in chit bearing No.HXYZ-14/42 because once dividend is earned the foremen has no right to forfeit the same.
6. Opposite party No.1 while releasing the prize amount in chit bearing HLS 05/21 has collected signatures of the complainant on some blank papers and blank formats stating it is a formal procedure for result as of the prize amount. Now there is every possibility to fabricate some documents on the strength of said blank signed papers and blank formats. The Opposite Party by not furnishing the documents to the complainant and with holding the payment of Rs.2,51,713/- caused to deficiency of service and unfair trade practice. Hence, the present complaint for the above stated reliefs.
7. The opposite party No.1 filed a written version and same is adopted by Opposite Party No.2. In the written version, Opposite Party No.1 admitted about complainant’s joining subscriber in two chits referred in the complaint and his participation in auction but denied the rest of the material averments in the complaint. The contest set out by Opposite Party No.1 in the written version is that the complainant joined as a subscriber in chit bearing No.HXYZ-14/42 agreeing to subscribe Rs.50,000/- for 50 months for a chit value of Rs.25,00,000/- and executed chit amount. Thereafter he paid 15 subscriptions then committed default. The Company is supplying documents of chit to subscribers where ever it is necessary and permissible under the Act. The complainant was at liberty to inspect the documents as per the Act. As per the terms of the chit agreement the complainant as a subscriber required to pay monthly subscription at the place indicated in the agreement and he was not expected to pay to 3rd parties. Complainant also subscribed chit bearing No. HLS 05/21 for a chit value of Rs.10,00,000/- and was successful bidder in that chit. The Foremen of the Company as a custodian is required to insure that prized subscriber furnish proper sureties for future liability and any delay in furnishing the sureties automatically will lead delay in payment of his prize money. If delay has been committed inspite of furnishing sufficient sureties the complainant got a right to approach appropriate authorities for deficiency in service. The allegation of the complainant that he was forced to obtain Life Insurance Policy for Rs.1,00,000/- from the sister concern is false. Infact complainant himself joined and purchased Life Insurance Policy for Rs.1,00,000/-.
8. The complainant paid 25 subscription of Rs.20,000/- each and it worked out at Rs.5,00,000/- which is equal to the prize amount and failed in the said chit, as a defaulter he was not entitled for dividends. The complainant was furnished with passbook and at the time of payments of amount the concerned person will enter payments which reflected the amount paid by him. After receiving the chit amount in chit bearing No.HLS 05/21 he committed default. The complainant stood as guarantor to one Mr. V.Yadagiri Reddy in chit No.HLS 05/23 and said Mr. V.Yadagiri Reddy committed default in his chit. Hence, Opposite Party No.1 filed recovery proceedings against the Mr. V.Yadagiri Reddy and his sureties including the complainant in Arbitration proceedings No.100/14 before Deputy Registrar of Chits. Hence, until the settlement of the said proceedings the amount due to default chit No. HXYZ 14/42 cannot be adjusted. The complainant gave a letter asking to adjust the amount to chit No.HLS 5/23 as Mr. V.Yadagiri Reddy to whom, he stood as surety. Hence, the complainant has no cause of action and the complainant is liable to be dismissed.
9. In the enquiry stage the complainant has got filed his evidence affidavit reiterating allegations of the complaint. He also got exhibited six documents. Similarly for Opposite Party No.1 the evidence affidavit of it’s Foremen Mr. E. Raju is got filed and through him it has exhibited 26 documents.
10. Both sides have filed written arguments and supplemented the same with oral submissions.
11. On a consideration of material placed on the record the following points have emerged for consideration:
- Whether the complainant could make out a case if either deficiency of service or unfair trade practice in the chits concerning to him?
- Whether the complainant is entitled for the releifs claim in this complaint ?
- To what relief ?
- Point No.I: The main allegation of the complaint is in the chit group of HLS 05/21 after he became successful bidder for an amount of Rs.6,00,000/- out of the chit amount of Rs.10,00,000/- bid amount was no paid to him immediately though he furnished required sureties and thereafter an amount of Rs.1,00,000/- was taken towards Life Insurance Policy from sister concern of Opposite Party No.1 as such the issuance of Life Insurance Policy by name Shriram Ujval Life was against his interest and he was paid only Rs.5,00,000/- as bid amount. Hence, it is to be seen whether the version of the complainant that Opposite Party No.1 insisted on him to obtain Life Insurance Policy from the sister concern of Opposite Party No.1 is true or not. It is the consistent stand of Opposite Party No.1 that the complainant himself approached to take a Life Insurance Policy and there was no compulsion on him. The Opposite Party No.1 has filed Ex.B3 letter in the hand writing of the complainant and through this letter he has expressed his interest to take Life Insurance Policy of Rs.1,00,000/- and requested to deduct Rs.1,00,000/- as premium from his prize amount. In the light of the stand taken by the complainant that he was compel to take policy this Forum has compared the admitted signatures of complainant available on the main complaint and also on his evidence affidavit with the signature on Ex.B3 letter and to a naked eye it is crystal clear that, both signatures are belongs to same person. Nowhere the complainant has stated that under compulsion he wrote Ex.B3 letter and infact he has not mentioned giving of letter under compulsion requesting the Opposite Party No.1 to deduct premium amount from the bid amount payable to him. As such, this allegation of the complainant is found to be incorrect.
- The complainant’s stand is from the bid amount he requested the Opposite Party No.1 to adjust the amount payable as future subscription in the other chit in which he paid a sum of Rs.7,50,000/-. According to the complainant he joined as subscriber in the chit bearing No. HXYZ 14/42 for a chit value of Rs.25,00,000/- and monthly subscriptions payable was Rs.50,000/- and after paying, 15 subscriptions he could not continue the chit hence requested to adjust the 15 subscriptions and dividend allowed to him towards future subscriptions payable in the chit bearing No.HLS 05/21. His claim is in the chit bearing No.HXYZ 14/42 the amount of Rs.7,50,000/- includes dividend accrued to him for 15 subscriptions. This claim of complainant is not sustainable because a subscriber who discontinued the subscription is not entitled for the dividends. Ex.B12 is the chit agreement executed by the complainant while joining as a subscriber in this discontinued chit. First clause of EX.B12 agreement reads as under:
If a Non-prized Subscriber fails to deposit his/her monthly Subscription before the due date, interest shall be charged @ 18% per annum. If default continues for more than two months, the subscriber will not be entitled to dividends in addition to the aforesaid interest charges. A Subscriber who has not made upto-date payments of all the instalments due from him/her will not be permitted to bid in the auction.
In the light of this clause in the agreement of the claim of the complainant that once dividend accrued to him cannot be taken away bythe foremen has no legs to stand.
- The complainant is silent as to what was the actual amount paid by him by way of 15 subscriptions in the discontinued chit. The Clause-I of chit agreement further says a removed subscriber is entitled to the amount actually subscribed by him and 5% of chit amount would be deducted towards the damages for breach of contract. So, the complainant’s claim that an amount of Rs.7,50,000/- belonging to him is lieing with the Opposite Party No.1 and it can adjust an amount of Rs.3,73,287/- towards the future subscriptions of the other chit has no force to sustain.
- Much before filing of the present complaint Opposite Party No.1 has initiated proceedings against the complainant and his sureties by filing a suit before the arbitrator. The complainant himself in Ex.A4 notice has stated that he mentioned with received summons from Deputy Registrar of Chits in Arbitration reference No.894/2014. This notice was issued on 30.11.2014. Whereas, the present complaint was filed on 07.03.2015.
- Infact, as could be seen from Ex.B10 he filed a written submission before the Deputy Registrar of Chits / Arbitrator before whom Opposite Party No.1 filed a claim for recovery of the money from the complainant and his guarantors. So, he contested the claim of the Opposite Party No.1 before the Arbitrator and after said contest only the Arbitrator has passed an award. Apart from that Opposite Party No.1 also filed a complaint before the Deputy Registrar of Chits in two more chits against one Mr.Yadagiri Reddy and his sureties including the present complaint -Ex.B17 is the award copy in ABR/CF No.100/2014 passed on 31.01.2014 along with the recovery certificate. The said Yadagiri Reddy seems to have defaulted in two chits and for one chit complainant appears to be a surety along with three others. So, it is crystal clear that the claim preferred by Opposite party No.1 against the complainant and his guarantors was adjudicated by the Arbitrator and passed an awarded and issued recovery certificate. Then how can the complainant ask this Forum to enquire his complaint which was subject matter before the Arbitrator. The very initiation of complaint when the claim preferred by Opposite Party No.1 is pending before Sub-Registrar of Chits is not permissible in law. An attempt is made by the learned counsel for complainant stating that, the complainant has no knowledge of Arbitration Proceedings and he did not participate in the said proceedings. As already said the documents placed on record shows that the complainant filed a written submission and participated in the proceedings before Sub- Registrar of Chits. An award passed by the Arbitrator is executable before a civil court. This Forum while entertaining the complaint cannot review the award passed by an Arbitrator. If, the complainant was aggrieved with the initiation of the proceedings before the Arbitrator or for the award passed the remedy lies elsewhere by filing a original petition file before the District Court either to set aside the award or to challenge the appointment of Arbitrator but he cannot file a consumer complaint. If, the complaint is allowed for any part it will amounts to allowing the party to run the two parallel proceedings which is not permissible in law. Hence, the point is answered against the complainant.
- Point No.II: In the light of the above findings to Point No.1 it is to follow that the complainant is not entitled for any of the releifs.
- Point No.III: In the result the complaint is dismissed. No order as to costs.
Typed by Typist, corrected and pronounced by us on this the 18th day of December, 2018.
MEMBER PRESIDENT
APPENDIX OF EVIDENCE
PW1 DW1
Sri Vemireddy Jithender Reddy Sri E.Raju, Foreman/BM.,
Exs. Filed on behalf of the Complainant:
Ex.A1: Bid payable slip dated 23.07.2010.
Ex.A2: Statement of Account pertains to HLS-5/21.
Ex.A3: Representation dated 28.10.2014.
Ex.A4: Legal Notice dated 13.11.2014.
Ex.A5: Proof of Delivery dated 14.11.2014.
Ex.A6: Lien lifting Application, dt.24.09.2012.
Exs filed on behalf of the Opposite party
Ex.B1 : is copy of Agreement of Chit.
Ex.B2 : is Original letter submitted by the complainant dt.24.09.2012 to the BM, Himayatnagar, HYD.
Ex.B3 : is Original letter submitted by the complainant dt.14.10.2010 to the BM, Himayatnagar, HYD.
Ex.B4 : is Premium paid certificate for the year 2010-2011 issued by Shriram Chits,
Ex. B5 : Original Lien document executed by the complainant dt.31.01.2012.
Ex. B6 : Computerized Statement of Account in Chit No.HXYZ -14/42.
Ex. B7 : Certified copy of the Arbitration proceedings No.894/2014.
Ex. B8 : Certified copy of Agreement, Chit No.HLS-05/21.
Ex.B9 : Original minutes book with Xerox copy of minutes of auction proceedings in chit No.HLS 5/21.
Ex.B10 : Certified copy of written statement filed in ARb.No.894/2014, Chit No.HLS-05/21.
Ex.B11 : Certified copy of the Arbitration proceedings No.100/2014, chit no.HLS-05/23.
Ex.B12 : Certified copy of Chit Agreement executed by V.Yadagiri Reddy in his Chit No.HLS/05/23.
Ex.B13 : Original minutes book with Xerox copy of the minutes of the auction proceedings in chit No.HLS-5/23.
Ex.B14 : Agreement of Guarantee executed by Vemi Reddy Jithender Reddy complainant herein to V.Yadagiri Reddy in chit NO.HLS-5/23 along with others dt.31.01.2012.
Ex.B15 : Demand Promissory Note.
Ex.B16 : Statement of account in chit NO.HLS-5/23.
Ex.B17 : Certified copy of Award dt.18.05.2015 in Arb.No.100 of 2014.
Ex.B18 : Statement of account in chit No.HLS-5/23.
Ex.B19 : Statement of account in chit No.HRD-5/19.
Ex.B20 : C.C. of Claim petition in chit No.HRD-5/19 against Sri V.Yadagiri Reddy by OPNo.1
Ex.B21 : C.C. of chit agreement executed by Sri V.Yadagiri Reddy in Chit No.HRD-5/19.
Ex.B22 : Agreement of guarantee executed for V.Yadari Reddy in Chit No.HRD-5/19.
Ex.B23 : C.C. of D.P. Note executed by Sri V.Yadagiri Reddy chit No.HRD-5/19.
Ex.B24 : C.C. of Cash Voucher executed by Sri V.Yadagiri Reddy in chit No.HRD-5/19.
Ex.B25 : C.C. of Legal Notice issued by OP.No.1 to Sri V.Yadagiri Reddy and return postal covers.
Ex.B26 : C.C. of Award passed in ARb.No.345/2014.
MEMBER PRESIDENT
