Karnataka

Bidar

CC/22/2015

Mohammed Maqsood S/o Chand Patel - Complainant(s)

Versus

,Shriram Tranposrt Finance Co.Ltd. - Opp.Party(s)

P.M.Deshpande.

30 Jan 2017

ORDER

::BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM, AT BIDAR::

 

 

                                                                                                         C.C.No. 22/2015

 

                                                                                           Date of filing: 28/03/2015

 

                                                                                       Date of disposal : 30/01/2017

 

 

P R E S E N T:-              (1) Shri. Jagannath Prasad Udgata,

                                                                                         B.A., LL.B

                                                                                                       President.

    

                                         (2) Shri. Shankrappa  (Halipurgi),

                                                                      B.A.LL.B.

                                                                                  Member

 

                                   

 

                                               

COMPLAINANT:              Mohammed Maqsood, S/o Chand Patel

                                       Age: 52 years, Occ: Business,

                                         R/o Tq.Humnabad,Dist.Bidar. 

 

                                      (By Shri. P.M. Deshpande, Advocate)

 

 

                                                      VERSUS

 

OPPONENT/S   :-            1. The Branch Manager,

                                             Shri Ram Transport Finance Co. Ltd.,

                                                Basavakalyan Branch,

                                                 Tq.Basavakalyan,Dist.Bidar.

 

                                          2.  The Managing Director,

                                                Shri Ram Transport Finance Co. Ltd.,

                                             Mukambika Complex, 3^rd Floor,

                                                 No.4, Lady Desika road, Mylapore,

                                                Chennai-600004.

 

                                       3.   The General Manager/Administrative  

                                             Officer, 101-105, 1^st Floor, B-Wing,

                                             Shiva Chambers, Sector-11, C.B.D. Belapur,

                                                Navi Mumbai-4600614.

 

                                            ( By Shri. Anantkumar S. H.,Advocate )  

                                     

 

 

 

::   J U D G M E N T  : :

 

 

 

By Shri. Jagannath Prasad Udgata, President.

 

    The complainant has filed the complaint u/s.12 of the C.P.Act, 1986, alleging  deficiency of service in the part of the O.Ps.  The origin and genesis of the case is as follows:

2.          The complainant is  native of Tq.Humnabad , Dist.Bidar.  He is  unemployed and  married person and having children.  The entire responsibility of maintenance of his family is on the head of the complainant, hence to earn his livelihood, had purchased lorry bearing no.K.A.-39-5786 in the year 2009 and the vehicle was registered with R.T.O. Bhalki, Dist.Bidar. Complainant avers that in the month of November-2010 he approached the O.P. no.1 to avail vehicle loan, and the complainant had visited the office of the O.P.no.1 at Basavakalyan several times. Thereafter the O.Ps have made enquiry about the complainant and after having complete information about the complainant, the O.Ps have agreed  to provide financial assistance to the complainant and sanctioned vehicle loan in a sum of Rs.2,52,000/- in the name of complainant, on lorry bearing Reg.no.KA 39-5786.   Thereafter on several requests by the complainant, the O.Ps have released the vehicle loan amount for Rs.2,21,850/-only through cheque and directed to Dist. Co-Operative Central Bank Bidar to pay a sum of Rs.2,21,850/- in favour  of complainant.  Accordingly, the complainant has received vehicle loan amount on 21/01/2011 in a sum of Rs.2,21,850/- but, the O.Ps have not released entire sanction loan amount. The said repayment loan schedule is provided by the O.Ps for 36 months from 21-01-2011 till Jan.2014 and O.Ps have taken signatures of the complainant on blank printed format/hire purchase agreement etc. and all pages were unfilled, while taking signature from the complainant.  The O.Ps had promised that they would send the hire purchase agreement after being duly filled and signed by the O.P.  But, the O.Ps had not sent the hire purchase agreement in spite of several request by the complainant.  This act of the O.Ps, clearly shows that  there was  deficiency of service on the part of the O.Ps.   The complainant further avers that, the complainant was very sincere and honest and without having repayment schedule the complainant had paid a sum of Rs.3,69,000/- and even after receiving a sum of Rs.3,69,000/- the O.Ps have not sent repayment schedule and not provided the copy of the vehicle loan agreement for which, number of times the complainant has telephoned and requested to provide copy of the agreement and repayment schedule but in vain.

3.                   Complainant further avers that in the month of April-2014 the lorry of the complainant was proceeding from Hyderabad and the lorry was carrying retail goods of B.K.Transport Hyderabad. The said goods were ought to be given delivery at B.K.Transport, Basavakalyan.  When the lorry reached  Zaheerabad, the seizure agents of the O.Ps had stoped the lorry at Zaheerabad and forcibly entered into vehicle and made efforts to seize the vehicle at Zaheerabad by using their muscle power, but son of the complainant Mr.Kabeer and driver of the said lorry Mr.Baba Ali requested the agents of the O.Ps the goods which was carrying in the lorry ought to be given delivery at Basavakalyan therefore not to seize the vehicle at Zaheerabad.  The request made by the driver  for the time being was considered by the agents of the O.Ps and permitted the driver to drive the vehicle up to Basavakalyan.   At the same time the agents of the O.Ps had also come in the lorry up to Basavakalyan and permitted the lorry driver to unload the goods which was being transported from Hyderabad. Accordingly  the driver of the complainant has given delivery of the goods to the B.K.Transport at Basavakalyan and when son of the complainant was collecting the rent of service provided by the lorry from Hyderabad to Basavakalyan for Rs.3,500/- from B.K.Transport Basavaklayn, the agents of O.Ps had forcibly taken Rs.3,500/- from the   hands of the son of the complainant  and not issued receipt and thereafter the driver of the lorry and son of the complainant both have requested to the seizure agents of the O.Ps not to seize the vehicle at Basavakalayn.  The son and driver of the lorry had informed to the seizure agents of the O.Ps  that already the complainant had made repayment of vehicle loan as on April-2014  and there was no due in respect of vehicle loan. But, the seizure agents of the O.Ps did not consider the request made by the son of the complainant and forcibly the agents had seized the vehicle of the complainant.  The agents of the O.Ps had not given any opportunity to the complainant to show the details of repayment of vehicle loan. The agents had shown muscle power and forcibly had seized the vehicle.  The manner of seizure which was used while seizing the vehicle of the complainant at Basavaklayn was not according to the mandatory provisions of the seizure of the vehicle.   Without issuing any notices to the complainant the O.ps have seized the vehicle, which is absolutely deficiency of service in the part of  the O.Ps.   The duty of the O.Ps to verify the accounts maintained by them whether the complainant was correct or wrong.   Without verifying the accounts, the O.Ps had seized the vehicle of the complainant.   Hence the complainant is before this Forum by claiming for a sum of Rs.18,03,500/-with costs.

 

 

 

 

4.              Entering into defense the O.Ps have filed detailed written versions and therein the entire contents of the complaint are denied as false, frivolous and vexatious.  As per O.P. the complaint is not tenable in law or on fact.  The complainant has filed a false and dubious complaint knowing it to be false and with sole intention to harass the O.P.s.  The O.Ps aver that the O.P.Company is non Banking public limited financial institution.    They are engaged in the commercial vehicle finance business.  The complainant has borrowed a commercial vehicle loan from the O.P.no.1 financial institution to purchase 1998 model Ashok Leyland Heavy goods Vehicle beg.no.KA 39/5786 under the guarantor ship of Mr.Md.Abdul Haq of Humnabad by jointly executing the loan cum hypothecation agreement dated        30-11-2010.  In view of availment of loan from the O.P.No.1 financial institution, complainant is borrower of the O.P.No.1.  Therefore, Borrower is not a Consumer within the meaning of section 2(1) (d) of the Consumer Protection Act.  Therefore complaint filed by the complainant before this Forum is not at all maintainable.

5.                      The entire contents of para 2 to 13 of the complaint are all false.  The amount of compensation described and claimed at para 14 of the complaint is improper and illegal and the complainant is defaulter in payment of loan.  The seizure of the vehicle by the O.P. in accordance with the terms of the agreement does not constitute deficiency of services and O.Ps are not liable to pay any compensation. 

 

6.                   The entire contents of para 15 to 25 of the complaint are all false  and the complainant is bound to be put to strict proof of the same.  The essence of the agreement was prompt, punctual and regular payment of monthly instalments and  upon committing default, vehicle is repossessed by the O.P.no.1. Even after repossession of vehicle, the complainant had not come forward to settle his loan account.  Therefore, having no option O.P.no.1 had sold vehicle in a open auction.

7.                      According to clause 15 of the agreement, complainant had agreed and undertaken to get resolve his all disputes, difference of opinions of claims arising out of agreement i.e. during subsistence of hypothecation the O.P. by process of arbitration appointed and nominated by the O.P. financial institution.  Instead of resolving his dispute by process of arbitration, he has approached thisForum with untenable complaint.   The complainant had filed a false complaint, contrary to the terms of Loan cum Hypothecation agreement.  The obligation arising out of the agreement cannot be questioned by the complainant before this Forum.  Moreover, the rights and obligations which are conferred by the terms of the agreement cannot be construed as “Deficiency of Service” within the meaning of Section 2(1) (c) of the Consumer Protection Act.  Therefore, such dispute cannot be adjudicated by this Forum.  Hence the complaint filed by the complainant may be dismissed with cost of Rs.25,000/-.

 

8.             Both the sides have filed their respective evidence affidavits and written arguments reiterating their respective stands and have further filed documents relied upon by them as listed at the end of this order.  The parties have also quoted Judgments of higher Foras as listed hereunder.

                  Complainant

2015 (2) CPR 584 (NC) M/s. Magma Fincorp Ltd V/s Tikeswar Barik Rati Ratio:  Consumer Protection Act, 1986-Sections 15,17,19 and 21- Financial services –Vehicle loan-Repossession of vehicle for default in paymentof instalments-Vehicle was neither surrendered by complainant petitioner company nor was it repossessed with his consent-No order from a competent Court of law was obtained before repossessing vehicle-Vehicle was in use and goods were loaded on it when it come to be seized by agency appointed by petitioner company for such purposes-Seizure of vehicle in such manner was absolutely illegal and un-justified-If vehicle is seized in such a manner it is bound to cause tremendous harassment and mental agony to owner of vehicle besides agitating his reputation-Grant of appropriate compensation on account of such gross deficiency in service would be eminently justified.  No material has been placed on record by the petitioner company to show that sale was duly avertised in newspaper before vehicle sold-Considering gross deficiency in service on part of petitioner company, award of compensation to extent of Rs.3,20,000/-  cannot said   to be unjustified or unreasonable ground for interference with order of the Forum on merits is made out- Revision Petition dismissed.

The O.Ps also quoted Judgments of higher Foras. The same listed hereunder

I) 1995(3) CPR, 93, State Consumer Disputes Redressal Commission Karnatak, Bangalore,

Smt. Revathi Kalyan Kumar V/s K.S.F.C.

•  

 

allegation that properties were sold for a paltry sum-Relationship between complainant and Opp. Party is only that of borrower and creditor complainant is not a consumer and complaint is untenable.

 

2.  

State Consumer Disputes Redressal Commission, ORISSA.

Tara Prasad Swain v/s M/s. Swaraj Mazda Ltd. & Ors.

•  

 

Result: Complaint dismissed.

 

III) 2013 (3) CPR 164 (NC)

PDC Marketing Private Ltd. V/s Axis Bank Ltd.

 

Ratio :Consumer Protection Act, 1986- Sections 2(1) (d), 17,19 and 21-complaint-maintainibility-Bank account-while dismissing compliant State Commission observed that it is not a case of simple banking service but a camouflaged commercial activity was being carried out through this system in which 10060 ATM Cards had been activated by bank-It is a case of a bank account opened by a business company in furtherance of its commercial business—Complainant cannot be treated as consumer—Decision of State Commission is based on correct appreciation of facts and law—Appeal dismissed.

 

 

IV) 2012 (4) CPR 75 ( NC)

Shriram Transport Finance Co.Ltd. v/s Mr. Chaman Lal.

Ratio: Consumer Protection Act, 1986—Sections 15,17,19, and 21—Financial services—Hire Purchase—Repossession of Vehicle—Complaint allowed by Fora below—Petitioner financed tractor and Loan-cum-Hypothecation Agreement was executed between complainant and petitioner and pursuant to this agreement petitioner was bound to pay instalments—Even after seven months complainant paid only Rs.20,000/- towards instalment and failed to pay rest of instalments—In such circumstances possession of tractor was taken by representative of petitioner—Information to hirer, guarantor and two police stations was also given by petitioner—In absence of payment of instalments and due amount, if possession of vehicle was taken by petitioner or surrendered by complainant and sold in auction, petitioner has not committed any deficiency in providing service—Impugned order set aside—Revision petition allowed.

 

5.  

Mr. Ashok Laxman Gulhane v/s The Manager, Tata Finance Co. Ltd & ors.

•  

 

6.  

State Consumer Disputes Redressal Commission Karnataka.

The Chairman Karnataka Housing Board v/s

Sri. K.S. Panchapakeshan.

•  
•  

 

7.  

 

Rajeshwar Prasad V/s BCL Financial Services Ltd.

•  

 

8.  

 

Ashok Leyland Finance Ltd. V/s Himanshu S. Thumar.

•  

 

9.          Taking into consideration the rival contentions of the parties and the citations quoted by the parties the following points arise for our consideration:-

1. Do the O.Ps prove that, the complainant is not a Consumer?

 

2. Does the complainant prove that there has been a deficiency in service on the part of the O.Ps?
3. Have not the O.Ps resorted to unfair trade practice as defined U/s. 2(1) (r) of the C.P.Act, 1986?

 

 

4. What order ?

 

 

10.           Our answers to the points stated above are as follows:-

 

               1. In the negative.

               2. Partially affirmative.

               3. In affirmative.

               4. As per the final order, for the following:

 

 

 

 

:: REASONS::

 

11. Point No.1.    The O.Ps are vociferous that, the complainant was borrower under them and hence quoting some Judgements of State Commissions and National Commission (older cases)as detailed supra do claim that, the complainant is not a Consumer.  With due respect to the findings of state Foras, we are not inclined to accept the ratios agitated by the O.Ps.  We rather are inclined to accept the ratio put down by the complainant. We refer to the definition of “Service”as defined in section 2(1) (o) of the C.P. Act. 1986, which  reads as follows:

    

“Service”means service of any description which is made available to potential [users and includes, but not limited to, the provision of] facilities in connection with banking, financing, insurance, transport, processing supply of electrical or other energy, board or lodging or both, [ housing construction], entertainment, amusement or the purveying of news or other information, but does not include the rendering of any service free of charge or under a contract of personal service;

 

12.          Hence, it is crystal clear that, the term finance is inclusive of service.  Further  more a feeble attempt has been made by the O.Ps to canvass that, the lorry was being used for commercial purpose, taking a reference from the fact that, at the time of seizure, it was being driven by a Driver.  However we are not inclined to accept such claim, as no individual can, drive a lorry 24/7 and no fault can be found if one engages a driver to drive the lorry during spare time.  The complainant gets fitted in the explanation of section 2(1) (d) of C.P.Act.  To our humble consideration, the term financing would denote, lending, borrowing, charging and paying interest on financial transactions, paying dividends on shares, debentures and F.Ds and other investments, share capitals pledgements and all sundry activities in give and take formulations.  Herein, the complainant had availed a loan by pledging an asset, whereby, the feasance is governed by the term financing.  Not withstanding few rulings of some other state Foras to the effect that, borrowing activity (s) would not be within the purview of the C.P.Act, 1986, we hold that, the case is within the ambit of the Act.  The O.Ps have not quoted any similar ratio passed by th Hon’ble Apex Court, which could have bound our hands under Article 141 of the Constitution.  Hence, we answer the point no.1 in the negative.

 

13.   Point No. 2.    As per the documents produced by the parties in dispute, we don’t find any notice  has been issued to the complainant warning him to clear his outstanding dues.  A seizure has taken place abruptly without any notice, in a most high handed manner, without even any proceeding under the SARFESI Act, which is  beyond any appropriate business acumen, in the part of the O.Ps.  We decry the seizure, in confirmity with the latest ratio laid down by the Ho’ble National Comission as described above.  We also have before us documents loan cum hypothecation agreement produced bythe O.P. as Ex.R.2 and summary of vehicle loan as document as Ex.R.3 schedule III.  An appendix of Ex.R.2, prescribes total amount payable as Rs.3,58,266/- in 36 EMIs.  The details of such 36 instalments works out to be (Rs.11,400/- X 31 + 3,795X5) altogether a sum of Rs. 3,72,375/-.  In Ex.R3 it is evident that, amount much higher than the payments prescribed  has been collected which ipsofacto prove the act of cheating of the O.P.  Glazing further to the contents of Ex.R3, we find that, as on 03/12//2013, the complainant has remitted the  last payment and the total payments as is evident from Ex.R.3 comes out to be Rs. 4,01,350-00, which constitutes an admission of the O.P.  It means the complainant/Borrower as on 03/12/2013 has paid much more than, what he was required to pay as Schedule III of Ex.R.2, whereby the seizure of the vehicle on 22/04/2014 is nothing but an act of deceit and robbery.  If the law would have conferred the power upon as while deciding a complaint under the C.P.Act, 1986, we would have taken recourse of section 44 of the Cr.P.C. and proceed accordingly.  But alas, our powers are hedged and ridged under the circumstances.  However, we hold the point no.2 accordingly.

 

14. Point no.3:    Analysing and synthesizing the discussions made above, we conclude that, the O.P. has factually adopted an unethical trade practice, which we reprimand and deprecate and answer point no.3 accordingly.

 

15.             Attempting to quantify the claims of the complainant to the extent of Rs. 18,03,500/-, we find little substance therein.  The claims are exorbitant, speculative and baseless.  The item no.1 of the complainant’s claim cannot be considered by us, owing to the embargo put against us vide two decisions of the Hon’ble Apex Court and the Hon’ble National Commission vide 2008 (CTJ) 561 (S.C.) and 2009 CTJ 535 (N.C.), in which it has been held that,“ Consumer Court can award compensation for deficiency of service.  For recovery of loss, complainant has to approach a Civil Court.”

 

16.              We therefore, refrain ourselves from such an attempt.  However, both higher Foras have conferred upon us the jurisdiction to award compensation for deficiency of service and we propose to proceed accordingly.  Then the question remains, how to quantify the compensation for deficiency of service?

 

17.                We see, from third page of Ex.R.1 that, the Lorry of 1998 model was assessed costing to be Rs. 3,55,000/-, which was pledged to the O.P.  Hence it is reasonable that, he should get back the same value as the object has been illegally seized and sold later to a third party by the Opponent.  He should be entitled for some amount as compensation on account of the mental agony, traumas and suffering in spite of having liquidated the dues coupled with interest due to high handed endeavour of the O.Ps.  Confining ourselves, to the corollary of events, adopting the principles of “Actus curiae naminem gravabit”we herewith pass the following:

 

 

 

: :   ORDER : :

 

1.  The complaint is allowed in part.

 

 

              b) The O.Ps would be bound to pay a sum of Rs. 3,55,000/- and a matching amount in the like sum as compensation,  totalling in a sum of Rs. 7,10,000/- to the complainant together with interest @ 12% p.a. from the date of seizure till the date of realisation.

 

             

               c)   A further sum of Rs. 20,000/- towards the litigation expenses would be payable by the O.Ps.

 

              d)  Acting U/s. 14 (1) (hb) of the C.P. Act, 1986, we impose a penalty of Rs. 5,00,000/- payable by the O.Ps to the “Consumer Welfare Fund”of the state of Karnataka, or to the “Consumer Legal Aid A/c”of this Forum, since none knows how many borrowers have been already  arm  twisted by the O.Ps in similar manner.

 

               e)  Acting further u/s.14 (1) (f) we direct the O.Ps. to put an end to unfair trade practices as discussed supra

 

                f)   Four weeks time is granted to fulfil this order.

 

                g)  A copy of this order be forwarded to the Asst. Director, Information and Publicity, near Railway Station, Bidar for wide publication in all vernacular and English daily published in the state.

 

 

 

   ( Typed to our dictation then corrected, signed by us and then pronounced in the open Forum on this  30^th  day of January-2017 )

 

              Sd/-                                                                                   Sd/-

Sri. Shankrappa H.,                                             Sri. Jagannath Prasad,                                  

       Member.                                                                   President.

  

Documents produced by the complainant

                                                                                                                              

1.Ex.P.1- Copy of Certificate of Registration.

2.Ex.P.2-Copy of Ration card in favour of complainant.  

3.Ex.P.3- Copy of I.D. Card of Maqood.

4. Ex.P.4- Copy of Transport service bill.

5. Ex.P.5- Copy of Transport service bill.

 6. Ex.P.6-Copy of Transport service bill.

 7. Ex.P.7- Copy of Transport Service bill.

8. Ex.P.8- Copy of letter addressed to R.T.O Bhalki by complainant.

9. Ex.P.9-Copy of legal notice.

10.Ex.P.10- Copy of another legal notice

11. Ex.P.11- Copy of reply to the legal notice.

12. Ex.P.12- copy of receipts issued by Shriram Transport Finance Co. ( Total 19 receipts )

13. Ex.P.13- Copy loan receipt issued by Shriram Transport Finance Co.

 

 

Documents produced by the Opponents.

 

1.Ex.R.1-  Original copy of loan application form.

2. Ex.R.2-Copy of agreement.

3. Ex.R.3-Copy of statement of account.

4.Ex.R.4-Copy of reply notice.

5.Ex.R.5-Unclaimed RPAD cover.

6.Ex.R.6-copy of reply notice.

7.Ex.R.7-Acknowledgement card.

8.Ex.R.8-Documents acknowledgement receipt.

9.Ex.R.9- Copy of inventory.

10. Ex.P.10-Copy of power of attorney.

 

 

 

 

              Sd/-                                                                                   Sd/-

Sri. Shankrappa H.,                                             Sri. Jagannath Prasad,                                   

       Member.                                                                   President.

 

 

 

mv.