Karnataka

Bidar

CC/5/2015

MD.Mustafa Khan S/o MD.Feroz Khan - Complainant(s)

Versus

SRIRAM TRANSPORT FINANCE COM. LTD - Opp.Party(s)

P M DESHPANDE

30 Jan 2017

ORDER

::BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM,

AT BIDAR::

 

 

                                                                                                                 C.C.No. 05/2015

 

                                                                                                  Date of filing : 06/02/2015

 

                                                                                             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/S:          Md. Mustafa Khan, s/o Md. Feroz Khan,

                                          Age : 27 years, Occ: Self Employment,

                                             R/o Jerpeth, Humnabad,Dist.Bidar.

                                              

 

 

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

 

 

                                                      VERSUS

 

OPPONENT/S   :-               Shri Ram Transport Finance Co.Ltd.,

                                         Through it’s Branch Manager,

                                            Biradar Complex, 2^nd Floor,

                                            Above Axis Bank, Triprant road,

                                            Basavakalya,Dist.Bidar.

 

                                     

  

 

 

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

 

 

                                                

::   J UD G M E N T  : :

 

 

 

By Shri. Jagannath Prasad Udgata, President.

 

                    This is a complaint filed by the above said complainant U/s.12 of the C.P.Act., 1986, against the O.P alleging  deficiency in service  on the part of O.P.   The gist of the case is as under:

 

 

2.          The complainant is a  native of Tq.Humnabad , Dist.Bidar.  Being  unemployed for his livelihood, had purchased lorry bearing no.K.A.-39-6063 by availing loan facility from  the O.P.   The EMI was fixed by the O.P. @ Rs.21,100/-per month and the complainant had paid all the EMIs regularly.  The complainant avers that, the said vehicle plying by the complainant had met with an accident,  the vehicle of the complainant was heavily  damaged in the said accident and the vehicle was repaired by the complainant by spending Rs. 4,95,000/-. 

 

3.            The complainant further avers that, on 21/06/2013 the respondent without giving any prior notice had seized the vehicle unlawfully and thereafter sold the vehicle.  This act of the respondent clearly shows that, there is a deficiency in service on the part of the O.P.  Due to this act of the respondent, complainant suffered heavy monetary loss, sustained in convenience and suffered mental agony.  Hence, complainant is before this Forum claiming compensation and costs.

 

 

4.            The O.P. further on receipt of notice from the Court had put up appearance through counsel of it’s choice and has filed written version wherein it is stated, the complainant has filed a false and dubious complaint.   The O.P. is a non Banking public limited financial institution and it was engaged in commercial vehicle finance business.  The complainant is a borrower  of the O.P. financial institution.  Therefore, borrower is not Consumer within the meaning of Section 2(1) (d) of the Consumer Protection Act.  Hence, the complaint filed by the complainant is not at all maintainable before this Forum.

5.            The O.P. avered that, as per the terms of loan cum hypothecation agreement O.P. has seized the vehicle on account of default committed by the complainant on 17-06-2014.  Though sufficient reminders, reply notice and vehicle pre-sale notice is issued, complainant was not ready  to clear the dues of the O.P.   The O.P. further avered that,  the complainants assertions about regular payment of instalments  and clearing the 1^st loan amount and that  the O.P. has seized the vehicle illegally and sold the vehicle without informing etc. are all false.  The complainant has concocted a false story to suit his ill-need.

 

6.        The O.P. further avered that the 1^st loan was granted to the complainant on 13-09-2007 under the guarantorship of one Mr.Khallel Ahmed.  Upon execution of loan cum hypothecation agreement jointly, the loan availed by the complainant  and financial charges agreed to be paid under the said loan cum hypothecation agreement is as follows:

 

1	Finance Amount	Rs. 8,00,000-00
2	Interest amount at the Rate of 10.82920% for 70 months	Rs. 5,05,362-00
	Total repayable	Rs.13,05,362-00

 

According to terms of the Loan Cum Hypothecation Agreement executed by the complainant in favour of the O.P. the essence of the agreement is prompt, punctual and regular payment of monthly instalments according to schedule I of the agreement commencing from 15-11-2007 to 15-06-2013.  The complainant had not honoured his commitment and had not paid the instalments as per loan repayment schedule and he had become defaulter.  At the request of the complainant his loan account was re-structured to enable him to pay instalments regularly upon execution of fresh (2^nd loan agreement) loan cum hypothecation agreement dated 30-05-2009.

 

7.                 The 2^nd loan was granted to the complainant on 30-05-2009 under the gurantor-ship of Abbas Ali, s/o Chandsab upon execution of loan cum hypothecation agreement jointly.  As per 2^nd agreement the total loan availed by the complainant and financial charges agreed to be paid thereon is as follows:

1	Finance Amount	Rs. 7,60,000-00
2	Finance charges for 57 months @ rate of 10.25% p.a.	Rs. 3,70,205-00
	Total repayable	Rs.11,30,025-00

 

8.          Even after extending co-operation by restructuring complainant’s loan account second time, he had not paid the instalments regularly and become defaulter.  Again he approached the O.P. to restructure loan account.  The complainant gave loan application dt.27-09-2012 to grant loan.  The O.P. by undertaking letter of the complainant dt. 03-10-2012, loan account of the complainant was restructured upon execution of their loan cum hypothecation agreement dt.20-10-2012.  One Mr. Gyaneshwar, s/o Shivappa of Humnabad stood as guarantor to the complainant.  Both of them jointly executed loan cum hypothecation agreement.  Under the said loan agreement dt. 20-10-2012, loan advanced to the complainant and financial charges agreed to be paid thereon is as follows:

1	Finance Amount	Rs. 6,77,913-00
2	Interest amount @ of 14.80000% for 54 months.	Rs. 4,51,,490-00
	Total repayable	Rs.11,29,403-00

9.            Even after extending co-operation to the complainant in repaying loan instalments regularly by restructuring his loan account time to time at his request, he had not repaid the loan instalments and in turn he has foisted false and vexatious litigations against the O.P. financial institution with revengeful attitude.  As per statement of vehicle loan account, the dues payable by the complainant to the O.P. Company as of 10-09-2015 a sum of Rs. 11,90,277-34 ps.

 

10.                According to clause 5(a) of the agreement, event of default means failure to make payment to O.P. or any part of the loan amount on demand or any other rate or charge due and payable under the agreement.  Further according to clause  6 (b) of the agreement in the event borrower/complainant committing default, the O.P. is entitled to take possession of the hypothecated vehicle without further any notice to the complainant.  The complainant was defaulter in payment of monthly instalments, though intimation issued to the complainant and his guarantor, they have neglected to clear the dues.  Therefore, having no option, the O.P. had seized the vehicle with due intimation to the complainant.  Even after repossession of the vehicle, a pre-sale notice was issued to the complainant and his guarantor to clear their dues.  The complainant and his guarantor have not responded to the pre-sale notice dated 03-12-2014.   The O.P. further avered that, the  complainant had filed false complaint, contrary to the terms of Loan cum Hypothecation agreement and the obligation arising out of the  agreement cannot be questioned by the complainant before the Forum.  Moreover, the rights and obligations which were 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 complainant may be dismissed with costs.

 

 

 

 

 

 

11.         Considering the rival contentions of the parties, the following points arise for our consideration:-

 

1. Does the opponent prove that, this forum lacks the jurisdiction to try this case?
2. Does the complainant prove that, there has been a deficiency of service in the part of the opponents?
3. What order ?

 

 

 

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

 

               1. In the negative.

               2. In the negative.

               3. As per the final order, owing to the following:

 

 

                                                                                                       :: REASONS ::

13.                   Attempting to answer the point No.1 supra, we scan the provisions enumerated in Section 2(1)(0) of the consumer Protection Act,1986.  Interalia, the subject of “Finance” is a topic in the provision. As per the version, affidavit and arguments of the O.P., we find that, an admission has been made, claiming that, the O.P. is a N.B.F.C. indulging into finance business, offering the services of advancing loan to procure transport vehicles.  That being so, the opponent cannot be permitted to demand exclusion of this Forum’s jurisdiction to try this case and  we answer the point No.1 in the negative.

 

14.                   As far as point No.2 is concerned, at no point of time, the complainant has countered the claim of the opponent that, the vehicle loan has been restructured several times to facilitate appropriate repayment.  The complainant has altogether filed 54(fifty four) money receipts granted by the opponent evidencing payments of dues.  From none of the receipts it is forthcoming that, the complainant has been diligent to pay the agreed dues at the appropriate time.  The payments had been erratic, at the fancy of the Borrower , skipping schedule of payments.  As far as the revelation about the accident and damages to the vehicles, the complainant should have brought the same to his lenders notice.  Even otherwise, he would have got the money spent from his insurer.  That, being so, the complainant has been consistently violating the terms of agreement and hence we answer this point in the negative.

 

15.                   As far as point No.3 is concerned, the vehicle has been seized and sold out in auction.   Albeit, notice of auction was given to the complainant, there is no pre-seizure notice ever issued by the opponent filed before us.  Therefore, we hold that, the seizure was illegal and unilateral and we agree  prima facie with the assertions of the complainant.  Next we have a ratio of the Hon’ble Apex court reported in III (2012) CPJ 4(S.C) Suryapal Singh V/S Siddhi Vinayak Motors & ors. in which has been held that “when vehicle had been possessed on account of default in payment of instalments and has been sold after due notice, no deficiency of service in the part of the OP can be presumed.”Therefore we cannot deny the rights of the opponent to seize the vehicle on default of repayment, the matter being technical in nature, but are constrained to hold that, consequent of the  sale of the vehicle by resorting to illegal seizure the opponent can’t be permitted to collect any amount captioned as dues from the complainant.  Hence we proceed to pass the following:-

 

:: ORDER ::

 

   

1. The compliant is dismissed as not due.
2.  The opponent would be precluded to claim any extra amount from the complainant.
3. There would be no order as to cost or  otherwise.

 

 

           d)  Four weeks time granted to comply this order.

 

 

( 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 legal notice of complainant,dt.02-07-2014.
2. Ex.P.2- Postal Acknowledgement card of the above.
3. Ex.P3- Schedule of repayment in loan agreement no. BSVKLO112160009.
4. Ex.P.4- Copy of R.C. Book.
5. Ex.P.5- Repayment schedule of another loan agreement.
6. Ex.P.6-  Letter correspondence of O.P., Dt.26-10-2012.
7. Ex.P.7- Copy of Account statement.
8. Ex.P.8-Another copy of account statement
9. Ex.P.9-Acknowledgement slip.
10. Ex.P.10-Authorisation certificate.
11. Ex.P.11-National Permit for goods carrier.
12. Ex.P.12-Copy of D.L.
13. Ex.P.13-Copy of Voter I.D.
14. Ex.P.14-06 photo copies of capsized.
15. Ex.P.15-Registration certificate card ( inside the cover)
16. Ex.P.16-Estimate of the accident vehicle.
17. Ex.P.17-Insurance Certificate
18. Ex.P.18-another insurance certificate
19. Ex.P.19-Copy of D.L. ( Motor ab, Transport Vehicle )
20. Ex.P.20-Pre-sale notice, Dt. 3-12-2014.
21. Ex.P.21-money receipts (total 55 number)

 

 Document produced by the Opponent/s

 

1. Ex.R.1 – Copy of application, vehicle loan, Dt.17-08-2017.
2. Ex.R.2-Copy of loan cum hypothecation agreement.
3. Ex.R.3-Copy of accounts statement.
4. Ex.R.4-Copy of loan application Dt. 22-05-2009.
5. Ex.R.5-Copy of 2^nd loan agreement.
6. Ex.R.6.Copy of account statement
7. Ex.R.7-Copy of another loan application, dt.27-09-2012.
8. Ex.R.8- copy of application of complaint, Dt.03-10-2012.
9. Ex.R.9-Copy of subsequent loan cum hypothecation agreement.
10. Ex.R.10-Copy of accounts statement.
11. Ex.R.11-Copy of vehicle inventory report,dt.17-06-2014.
12. Ex.R.12- Copy of legal notice dt.2-07-2014  (replica of Ex.P.1)
13. Ex.R.13- Copy of the legal notice.
14. Ex.R.14-Postal Acknowledgement of the legal notice.
15. Ex.R.15- Copy of Pre-sale notice, dt.3-12-2014.
16. Ex.R.16 –Copy of G.P.A. instrument in favour of one Chandrashekhar.
17. Ex.R.17- Copy of G.A.P. instrument in favour of Mr. Kishan Rao.

 

 

 

              Sd/-                                                                                   Sd/-

Sri. Shankrappa H.,                                             Sri. Jagannath Prasad,                                  

       Member.                                                                   President.

 

 

mv.