Kerala

Thiruvananthapuram

CC/17/10

Chandrababu S - Complainant(s)

Versus

Small Industries Development bank of india - Opp.Party(s)

18 Jan 2023

ORDER

BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL COMMISSION VAZHUTHACAUD THIRUVANANTHAPURAM

 

PRESENT

                               SRI.P.V.JAYARAJAN         : PRESIDENT

                               SMT.PREETHA.G.NAIR   : MEMBER

                               SRI.VIJU.V.R.                 : MEMBER

CC.NO.10/2017 (Filed on : 06/01/2017)

ORDER DATED : 18/01/2023

COMPLAINANT

Chandrababu.S,

S/o.Sreedharan.N

Working as Assistant Commandant in

Kerala Police, Residing at Kailasam,

Nilami Gardens, Nilami, Enikkara, Karakulam.P.O

Thiruvananthapuram

(By Adv.C.S.Rajmohan)

VS

OPPOSITE PARTY

Small Industries Development Bank of India,

Rep.by its Manager, Vikas Deep,

22, Station Road, Lucknow – 226019

(BY Adv.R.Azad Babu & Adv.P.Babu)

ORDER

SRI.VIJU.V.R                 : MEMBER

1.       The complainant has presented this complaint before this Commission under section 12 of the Consumer Protection 1986. The brief facts of the case is that the complainant attracted by the advertisement made by the opposite party applied for debentures with application number 6837396. The complainant took four deep discount bonds ie bond in from of promissory note worth Rs.2500/- each. The face value for each bond was Rs.1,00,000/- (Rupees one lakh only) each. The total face value assured by the opposite party was Rs.4.00,000/- (Rupees four lakhs only). The date of payment was on 30/11/1992 and the date of maturity was on 01/02/2018. The complainant made the payment to the opposite party through Federal Bank on 30/11/1992 for an amount of Rs.10,000/- (Rupees ten thousand only). On September 2016 the complainant received a notice from the opposite party stating that the call option availed on the opposite party was exercised and informed that the complainant is only entitled for an amount of Rs.9600/- (Rupees nine thousand and six hundred only) per bond and altogether complainant is liable to receive only Rs.38,400/- (Rupees thirty eight thousand and four hundred only). The letter dated September 2016 issued by the opposite party categorically stating that the call option was exercised by the opposite party on 2001 and the complainant is entitled only for an amount of Rs.9600/- per bond. During the advertisement the opposite party has clearly stated that the deep discount bond was for Rs.2500/-(Rupees two thousand and five hundred only) and the face value was             Rs.1, 00,000/-(Rupees one lakh only). It was also mentioned that when the call option is exercised after 20 years the complainant is entitled for Rs.50,000/- (Rupees fifty thousand each). The opposite party exercised the call option without the knowledge of the complainant which amounts to unfair practice, hence this complaint.

2.       The opposite party entered appearance and filed written version. The opposite party has averred that the complainant is not a consumer as the opposite party has not provided any service to the complainant. It is admitted by the opposite party that the complainant had purchased the deep discount bonds for February 1993. The opposite party had issued deep discount bond on February 1/1993 with a face value of Rs.2500/- per bond with a maturity value of Rs.1,00,000/- at the end of 25 years ie on February 1, 2018. In terms of the offer document dated October 16,1992 for issue of deep discount bond the investor as well as opposite party had the option to withdraw for redeem the bond respectively at the end of 5^th or 9^th or 12^th or 15^th or 20^th year from the date of allotment. In the event of such earlier withdrawal or redemption the deemed face value of the bond will be Rs.5,300/-at the end of 5 years, Rs.9600/- at the end of 9 years, Rs.15,600/- at the end of 12 years,  Rs.25000/- at the end of 15 years and Rs.50,000/- at the end of 20 years. These information were also printed on the face of the bond. The opposite party decided to redeem the bonds after 9 years by exercising the call option and accordingly the bonds were redeemed on February 1/2002 at the deemed face value of Rs.9600/- per bond. The opposite party had issued notices in various leading newspapers in English, Hindi and vernacular languages including Trivandrum edition of Malayalam Manorama on July 1, 2001. Further individual letters along with Form 15 H/15 AA were also issued to all the investors on July 24, 2001 under certificate of posting requesting them to surrender the duly discharged bond certificate for redemption. The opposite party also issued reminder letters on May 9/2005, July 3 2006, March 5, 2009 and by registered post on September 30, 2016 to all the investors who were yet to redeem their bonds in order to inform them that the call option information was indicated in most of the advertisement issued by the opposite party. The transaction stood matured, concluded and closed on February 1, 2002 at the deemed face value of Rs.8876/- (Rs.9600 less Rs.724, TDS deposited with IT Department in 2002). The opposite party has no obligation to pay any interest after February 1, 2002. The call option was exercised by the opposite party in terms of the offer document and the same is perfectly legal. There was no negligence or unfair trade practice on the part of the opposite party, hence the complaint may be dismissed with cost to the opposite party.

3.Issues to be ascertained:

i. Whether there is any unfair trade practice from the side of opposite party?

ii. Whether the complainant is entitled to get the reliefs?

4.Issues (i) & (ii):-

Both these issues are considered together for the sake of convenience the complainant has filed affidavit in lieu of chief examination and examined as PW1. The complainant has produced seven documents which were marked as Exts.P1 to P7. The complainant was cross examined by the opposite party. During the cross examination two documents were marked through complainant as Exts.D1 & D2. The opposite party filed proof affidavit and the documents were marked as Exts.D3 to D9. Both the parties filed argument notes.        

      5. The opposite party has taken the contention that the complaint is not maintainable as the complainant is not a consumer as the opposite party has not provided any service to the complainant.

          6. The term “consumer” as per Section 2(1)(d) of the 1986 Act: “includes any person who buys any goods for consideration or hires/avails any services for consideration”. Therefore, the term consumer is really broad and includes any beneficiary of service without differentiation with respect to the type of beneficiary or nature of goods or service he/she purchases.  So “any person” connected as the purchaser to “any goods” or “any service” is a consumer as per the Act. 

            The term ‘service’ is defined in Section 2(1)(o) of the 1986 Act:

•  

           7.         Therefore, it is clear from the preamble of the definition that service of any kind or nature that is rendered in exchange of consideration to direct or potential user comes within the definition of service. So this complaint is maintainable under Consumer Protection Act.

           8.     The allegation raised by the complainant was that the opposite party without any intimation to the complainant decided to take the call option on 1/2/2002. So that he will get only Rs 38,400/-. But the total face value assured by the opposite party was Rs. 4,00,000/- at the date of maturity, which is on 1.2.2018. But during cross-examination complainant has deposed that “ Bond വാങ്ങിച്ചപ്പോൾ എല്ലാ conditions നോക്കി മനസ്സിലാക്കിയിരുന്നു. shown to witness. Admitted. Marked as Ext.D1.” As per Ext.D1 it is clear that the investor as well as the SIDBI have the option to withdraw or redeem the bond, respectively at the end of 5^th or 9^th or 12^th or 15^th or 20^th year from the date of allotment. The complainant has also admitted Ext D2 document. Ext D2 is a call option notice dated 30/6/2001. It can also be seen from Ext P6, dated July 24,2001,that OP has intimated complainant regarding the date on which they are going to redeem the DDB on February 1,2002. So it is clear that the earlier redemption of debentures by the opposite party was known to the complainant. In these circumstances, the complaint filed by the complainant is not maintainable.

                In the result the complaint is hereby dismissed. Parties shall bear their own cost.

             A copy of this order as per the statutory requirements be forwarded to the parties free of charge and thereafter the file be consigned to the record room.

                Dictated to the Confidential Assistant, transcribed by her, corrected by me and pronounced in the Open Commission, this the 18^th day of January 2023.

 

                                                                                  Sd/-   

P.V.JAYARAJAN   : PRESIDENT

 

                                                                                              Sd/-

  PREETHA .G.NAIR: MEMBER

 

                                                                                                 Sd/-

VIJU.V.R     : MEMBER

 

 

Be/

 

APPENDIX

CC.NO.10/2017

List of witness for the complainant

PW1            - Chandrababu.S

List of Exhibits for the complainant

Ext.P1         - Copy of Deep Discount Bond No.0023508

Ext.P2         - Copy of Deep Discount Bond No.00238509

Ext.P3         - Copy of Deep Discount Bond No.00238510

Ext.P4         - Copy of Deep Discount Bond No.00238511

Ext.P5         - Copy of letter issued by opposite party dated 30/09/2016

Ext.P6         - Copy of letter issued by opposite party dated 24/07/2001 issued along with letter dated 30/09/2016

Ext.P7         - Copy of receipt for payment of Rs.10,000/- to opposite party through Federal Bank Statue dated 30/11/1992

List of witness for the opposite party  - NIL

List of Exhibits for the opposite party

Ext.D1        - Copy of offer document

Ext.D2        - Copy of call option notice

Ext.D3        - Copy of advertisement in malayala manorama daily

Ext.D4        - Copy of exercise of call option letter

Ext.D5        - Copy of consolidated dispatch slip

Ext.D6        - Copy of printout website pages

Ext.D7        - Copy of reminder of redemption amount

Ext.D8        - Copy of reminder of redemption amount  

Ext.D9        - Copy of reminder of redemption amount                         Sd/-

                                                                                                     PRESIDENT