Sri Utpal Kumar Bhattacharya, Member
Instant Appeal under Section 15 of the C.P. Act, 1986 has been filed by the Appellant/OP challenging the judgment and order dated 18.10.2016 passed by the Ld. District Forum Purba Medinipur in Consumer Case No. 67/2016 allowing the complaint on contest against the OP.
Respondent/Complainant was directed to pay Rs. 53,630/- to the Appellant/OP and the Appellant/OP was directed to return the vehicle in question immediately on receipt of the payment of the due amount.
The Appellant/OP was further directed to pay Rs. 10,000/- and Rs. 25,000/- to the Respondent/Complainant as litigation cost and compensation respectively.
Both sides were directed to carry out the above directions within one month from the date of the impugned judgment and order, failing which, as directed, the Appellant/OP would have to pay Rs. 100/- per day as punitive charges payable to Consumer Welfare Fund.
The facts, in brief, having relevance with the instant complaint, were that the Respondent/Complainant received an amount of Rs. 3,78,000/- as loan from the Appellant/OP Bank and purchased one LMV car, TATA Indica adding to the said amount of loan an amount of Rs. 1,65,000/- as his own contribution.
The repayment of the above loan amount was scheduled to be made in 48 EMI @ Rs. 10,630/-. The Respondent/Complainant failed to make repayment of the entire loan amount as per schedule and became defaulter for an amount of Rs. 53,630/-. Repeated persuasion and communication for repayment of the amount defaulted being gone in vain, the Appellant/OP took repossession of the vehicle from the custody of one third party named Malay Samanta. The Respondent/Complainant, however, remained indifferent towards repayment of the overdue amount in spite of the notices being served upon him towards taking custody of the vehicle on payment of the overdue amount and an ultimatum as well towards selling of the vehicle with a view to realizing the said outstanding loan amount. The vehicle, as alleged, was ultimately sold at a cost of Rs. 1,10,000/- only towards adjustment of the loan amount. The Respondent/Complainant, being aggrieved for disposal of the vehicle without procedural formalities being duly observed and also without any kind of notice being served upon him before and after repossessing the vehicle, filed the complainant case before the Ld. District Forum which the Impugned judgment and order was related to.
We have heard Ld. Advocates appearing on behalf of both sides.
Ld. Advocate appearing on behalf of the Appellant/OP pointed out the wrong observation of the District Forum towards full repayment of the loan amount when the fact remained that the Respondent/Complainant paid 44 EMIs only in place of 48 instalments as per schedule.
At para 5 of the complaint, the Respondent/Complainant himself had expressed that he intended to pay Rs. 30,000/- against the total outstanding amount. His very intention indicated that he had defaulted in making payment. The Ld. Advocate, however, denied any approach or communication made by the Respondent/Complainant towards payment of any amount after notices being served upon him to clear up his dues in full or in part.
Repossession of the vehicle from a defaulter loanee, as contended, was very well within the terms of Agreement and Respondent/Complainant who had signed the Agreement before awarding of loan was supposed to have gone through the contents of the same before recording his signature thereon.
The Ld. Advocate continued that the vehicle was sold by the Respondent/Complainant to one Malay Samanta from whom the possession was taken by the Appellant/OP. As contented, running page 48 would speak about sending intimation to the Respondent/Complainant towards repossession of the vehicle assigning therein the reason for taking such action. Running page 49 would speak about intimating the local PS about the circumstances under which the subject vehicle was being repossessed. Running page 50 spoke about the Respondent/Complainant being further cautioned about legal action including selling of the vehicle unless appropriate action towards payment of overdues was taken by him.
The Appellant/OP cited decision of the Hon’ble National Commission in Revision Petition No. 1485 of 2012 [ Pramod Kumar Rai—vs—Sriram Transport Finance Co. Ltd.] wherefrom it revealed that the Finance Company would not be in a wrong footing in repossessing the vehicle from a defaulter. Similar observation was made by the Hon’ble Commission in Revision Petition No. 3319 of 2012 [Surendra Kumar Sahoo—vs—Branch Manager Indusind Bank Ltd.]
With the above submission, the Ld. Advocate prayed for allowing the Appeal setting aside the impugned judgment and order.
Ld. Advocate appearing on behalf of the Respondent/Complainant, per contra, admitted that the Respondent/Complainant was defaulter in payment of an amount to the tune of Rs. 53,630/-. He, at the same time, pointed out that the Respondent/Complainant visited the Appellant/OP Bank with an intention to make part payment of Rs. 30,000/- which the Appellant/OP Bank refused to accept.
The Ld. Advocate continued to submit that the notices which the Appellant/OP had claimed to have been served upon the Respondent/Complainant, were, in fact, not served. The Appellant/OP, as he continued to state further, would not be able to furnish a scrap of paper corroborating their claim of actual servicing of notices.
The vehicle, as contended, was sold without any intimation to the Respondent/Complainant and without floating any tender. The price of the vehicle not being arrived at through competitive bid, the vehicle was sold at a very low price disregarding the interest of the Respondent/Complainant. Besides, had there been any tender, the Respondent/Complainant himself would have had the chance of participating in the tender.
The Appellant/OP, as contended, this way resorted to unfair trade practices disregarding the interest of his customer and put his customer to a grave financial loss.
The Ld. Advocate went on to refer to the decision of the Hon’ble Supreme Court in Criminal Appeal No. 267 of 2007 [ICICI Bank—vs—Prakash Kaur or Ors.] reported in (2007) 2 c cr LR (SC) 315 wherein the Hon’ble Apex Court in its illuminating observation alerted the financing institution to follow the Rule of law while repossession the vehicle and not to apply force while making seizure of the vehicle for recovery of loan.
He further cited two decisions of Hon’ble National Commission (1) in Revision Petition No. 2873 of 2015 [A U Finance India Pvt. Ltd.—vs—Ramdas Raghunath Patil] reported in 2016 (2) CPR 31 (NC) and (2) in Revision Petition No. 2961 of 2015 [ Magma Fincorp Ltd. and Anr.—vs—Sachin Kr. Singh] reported in 2016 (2) CPR 324 (NC) wherein Hon’ble National Commission made observations like (1) repossessed vehicle should not be sold without notice to the owner and (2) repossessed vehicle should not be sold for meagre amount respectively.
Perused the papers on record and considered submissions of both sides.
Admittedly, the Respondent/Complainant had defaulted in making the payment and there was an outstanding dues of Rs. 53,630/-. There was also no indication in the case record corroborating the claim of the Respondent/Complainant towards its intention of making a part repayment of Rs. 30,000/- out of the said outstanding amount of Rs. 53,630/- as claimed by him at the time of making submission. So, there was a violation of contract but it was at the same time true that there was a steady repayment till 44th EMI out of the total of 48 EMIs from the Respondent/Complainant which clearly revealed his honest effort for repayment.
Further, we have seen that the notices emphasizing on repayment of outstanding dues and cautioning towards putting the car into auction in case of non-payment of the overdues were issued to the Respondent/Complainant. Although, there was no cogent evidence establishing receipt of the said notices by the Respondent/Complainant, we had reasons to believe that those notices were duly served as the same were sent by post as it was evident from the copies of the postal receipt attached to the notices and there was no reason to think that the postal authority would not deliver any of this notices to the Respondent/Complainant.
We do not have any oblique observation towards repossessing the vehicle by the Appellant/OP Bank from the possession of one Malay Samanta, claimed to be the driver appointed by the Respondent/Complainant who was an established defaulter and accordingly, rule out the allegation of forcible repossession of vehicle.
We found that there was a serious deficiency in the activity of the Appellant/OP who had hardly displayed a consumer/customer friendly behaviour while putting into auction the subject vehicle without observing due process of adopting the tender formalities while taking the extreme step of selling out the vehicle to liquidate their stake. The RBI guidelines in case of adjusting overdues through sale of property repossessed as enunciated in policy known as ‘the code of Bank’s commitment of customers’ issued by the Governor, Reserve Bank of India was clear and unambiguous about providing the loanee with adequate opportunity to make his property clear through repayment of overdues. It was also very categorical about taking adequate and transparent step to sell out the vehicle as the last resort of recovery of the overdues ensuring that the maximum value could be derived out of the sale and the balance amount, after recovery being made, was handed over to the loanee owner.
On the instant occasion, we had not seen any copy of the tender notice which led us to assume that the process adopted for sale of the property was far from being transparent as no tender notice was floated for the sale keeping the Respondent/Complainant in dark about the process and thereby the vehicle itself was kept away from competitive bid. Had the tender notice been published, the Respondent/Complainant also might have had the opportunity to participate in the tender. On the instant occasion, it was not so. This made us convinced to believe that there was intentional lapse on the part of the Appellant/OP which put the Respondent/Complainant to severe financial loss.
Such being the sequences of events, we are constrained to consider that there was graver deficiency in rendering service on the part of the Appellant/OP.
The impugned judgment and order, therefore, was backed by reasoning so far as the assessment of the merit of the complaint is concerned but, it was not justified in providing the Respondent/Complainant with due relief. The return of vehicle, as ordered, was not possible since it came apparent from the W.V that the subject vehicle was already sold for liquidating the stake of the Appellant/OP Bank. We, therefore, were inclined to modify the order providing him with the cost of the vehicle considering the depreciation it had undergone with the passage of time together with compensation and cost.
Now, in order to assess the cost of the vehicle, we are left with no alternative but to consider the total IDV of the subject vehicle as per policy for the financial year 2014-2015 ending on 09.03.2015 which amounts to Rs. 2,68,160/-. Considering the said amount to be the price of the vehicle at the relevant point of time, we are inclined to direct the Appellant/OP to pay back the said amount to the Respondent/Complainant as the cost of the vehicle after adjusting the outstanding dues of Rs. 53,630/- of the Respondent/Complainant.
Hence,
ordered
That the Appeal be and the same is allowed in part. The Appellant/OP shall pay Rs. 2,14,530/- (2,68,160-53,630), Rs. 10,000/- and Rs. 25,000/- as cost of the vehicle, litigation cost and compensation respectively to the Respondent/Complainant within 45 days from the date of the instant order, failing which, simple interest @ 9% p.a. shall accrue to Rs. 2,39,530/-, being the total of the amount of the cost of the vehicle and the amount of compensation, from the date of default till the amount is fully realized.
