FA.No.10/2008  against C.D.No.883/2005, District Forum-I, Visakhapatnam.

Between:

1. Vommi Rama Murthy Chits & Investments Pvt. Ltd.,

    Visakhapatnam rep. by its Managing Director.

2. Vommi Rama Murthy Education Society,

    Visakhapatnam, rep. by its President.

3. V.Madhusuhdana Rao, Managing Director

    VR Chits & Investments Pvt. Ltd., and also

     President, V.R.Murthy Educational Society

    Visakhapatnam.

(All are rep. by GPA holder Mr.Gorla Ramesh

  S/o.G.V.Ramana Murthy, aged 37 years

  R/o.Flat No.301, Sri Satya Sai Towers

   Plot No.41, KRM Colony, Visakhapatnam)                                 .Appellants/                                                                                                                                        Opposite parties

And

Dr.Smt.N.Nirmala W/o.late K.Ravinder

Aged 49 years working as Associate Professor

Dr.B.R.Ambedkar College of Law

Andhra University, Visakhapatnam.                                                Respondent/

                                                                                                            Complainant

Counsel for the Appellant:                M/s.K.Srinivasa Rao                                                                                                                                                                                                                                                                                                                               

Counsel for the Respondent.           Mr.A.Rama Krishna

                        QUORUM:SMT.M.SHREESHA, HON’BLE MEMBER.

AND

SRI K.SATYANAND, HON’BLE MEMBER.     

MONDAY, THE TWENTY FOURTH  DAY OF AUGUST,

TWO THOUSAND NINE

ORAL ORDER: (Per Hon’ble Sri K.Satyanand, Member .)

                                                                                                                                                                                                                        ***

            This is an appeal filed by the opposite parties assailing the order of the District Forum directing them to refund Rs.90,000/- to the complainant together with interest as also a sum of Rs.20,000/- by way of compensation besides Rs.3,000/- towards costs.

        The facts of the case stated briefly are as follows:

        The opposite parties were doing business in chits and investments at Visakhapatnam. In the course of their business, they floated three chits bearing Nos. ST16G3, ST16G4 and ST16G17 in the month of November, 2003 and each chit was for Rs.50,000/- payable in 25 monthly instalments at the rate of Rs.2,000/- per month.  Attracted by the said scheme, the complainant joined as a Member in all the aforementioned chits on 3-11-2003, 5-11-2003 and 17-11-2003 respectively.  She paid 15 monthly instalments for each of the three chits by 31-12-2004.  Thereafter she alleged that the opposite parties did not come forward to collect the monthly subscriptions.  Soon she heard rumors that the opposite parties fell into financial crises and failed to honour the commitments of the subscribers.  She therefore demanded the opposite parties to refund her amounts.  It is alleged that the opposite parties did not respond.  Yet she waited till 15-2-2005 but without any avail.  She insisted upon the refund and produced her three pass books while retaining xerox copies on a suggestion of opposite party No.3.  Opposite party No.3 retained the pass books and delivered three promissory notes for Rs.26,500/- each in his capacity as President of opposite party No.2.  Later the complainant claimed to have suspected the bonafides of the opposite parties and therefore approached the police with a complaint to the Commissioner of Police on 16-2-2005.  Subsequently she approached the District Forum on the ground of deficiency in service.

        The complaint came to be resisted by the opposite parties, who filed a combined counter through opposite party No.2.  Opposite party No.2 denied having executed the three promissory notes in question and called them forged.  He also maintained that all the records were seized by the C.B.C.I.D in the month of April, 2005 as such he was not in a position to file a full counter.  He, however, commented that he was unnecessarily added as  party and in as much as the claim rests on so called promissory notes, the matter can hardly be called a consumer complaint to validly maintain it in the District Forum.

        In support of her case, the complainant filed her own affidavit and also tendered documentary evidence marked as Exs.A1 to A9 of which Exs.A1 to A3 were the promissory notes executed by one V.Madhusudhana Rao, opposite party No.3 and President of Opposite party No.2.  Opposite parties did not tender any evidence including the evidentiary affidavit. 

        On a consideration of the evidence adduced, the District Forum came to the conclusion that the matter obviously started as a contract for financial service being offered by opposite party No.1 by way of chit funds investment. The District Forum rejected the contention that the subsequent reliance upon the promissory notes changed the nature of the deal  into one of a money suit thereby impeding the jurisdiction of the District Forum.  It also with equal ease rejected the plea that the pronotes which were naturally tendered to serve as proof of original consideration were forged and false.  The District Forum also rejected the plea taken by Mr.V.Madhusudhan Rao that one V.Srinivasa Rao was the Managing Director of opposite party No.1 on the ground that opposite party No.3 did not file any proof to that effect.

        Aggrieved by the said order, opposite parties filed this appeal reiterating what all that they canvassed before the District Forum  and taking a further ground to the effect that when the police has seisen  over the issue, no complaint as present one did lie. 

        Heard both sides.

        The point for consideration is whether there are any good grounds to interfere with the order of the District Forum?

           Though the appellant had taken several pleas as it came to the stage of appeal, he banked upon only a couple of points namely that the District Forum lacked jurisdiction as the matter boils down to something like a suit on promissory notes and further when the criminal court had seisen over the matter, the District Forum ought not to have entertained this complaint and ought to have asked the complainant to seek remedies elsewhere.  But to our minds both these grounds are fallacious for the simple reason that the root cause of this litigation stems out of a chit fund transaction as the District Forum rightly gave a categorical finding in that regard relying upon Exs.A4 to A9.  The said finding is not assailed in the grounds.  The subsequent transformation of the deal by virtue of Exs.A1 to A3 was the only circumstance that is pressed by the appellants and such kind of fragmentary appreciation does not go down well with the basics of appreciation of truth in a judicial exercise. 

The other ground taken by the appellant in the memorandum of grounds is equally absurd.  It is contended by him that in as much as criminal law was set in motion in regard to the self same subject, the District Forum ought not to have entertained this complaint.  There is absolutely no authority of any law to substantiate this proposition.  On the other hand, the pursuit of other remedies has got nothing to do with the course of criminal action as it proceeds in a different stream.  Thus both the grounds pressed for the purpose of assailing the order of the District Forum cannot but be held as untenable.  In these circumstances, we are of the opinion that there are no merits in the appeal.

Accordingly the appeal is dismissed with costs in a sum of Rs.2,000/-.  Time for compliance six weeks from the date of receipt of this order.

MEMBER.           

                                                                                      MEMBER

                                                                         Dated 24-8-2009