BEFORE THE DISTRICT CONSUMER DISPUTES REDRESSAL FORUM-II, U.T. CHANDIGARH

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Complt. Case No : 1078 of  2009

Date of Institution:    30.07.2009

Date of Decision  :    10.11.2010

Raman Kumar Sharma s/o Late Sh. Ram Krishan Sharma, R/o H.No.1459, Sector 22-B, Chandigarh.

……Complainant

V E R S U S

[1]    TATA Capital Limited, SCO No. 1124-1125, Sector 22-B, Chandigarh, through its Branch Manager.

[2]    Sh. Rajesh Narang of M/s Axcess Services, R/o #968, Ph-7, Mohali.

.…..Opposite Parties

CORAM:        SH.LAKSHMAN SHARMA                     PRESIDENT

                SH.ASHOK RAJ BHANDARI          MEMBER

                MRS.MADHU MUTNEJA                    MEMBER

PRESENT:    Sh.R.K. Saroj, Adv. for the Complainant.

Sh.Sunil Toni, Adv. for Sh.Gagandeep Toni, Adv. for OP No.1.

OP No.2 ex-parte.

PER MADHU MUTNEJA, MEMBER

                The instant complaint have been filed by Mr. Raman Kumar Sharma s/o Late Sh. Ram Krishan Sharma alleging deficiency in service by Tata Capital Ltd. & Anr., under Section 12 of the Consumer Protection Act, 1986.  Initially, the complaint was filed against OP No. 1 only. However, the Complainant was allowed to implead OP No.2 as a party on 23.12.2009.

1]             The facts of the case are as under:-

                The Complainant, with an intent to buy a car contacted the OP through its agent – M/s Axcess Services for sanction of a car loan. The agent assured the Complainant that no document, service or any hidden charges would be taken from the Complainant. The Complainant has alleged that he was made to sign a number of standard printed documents, along with some blank papers and stamp papers, as per their norms & procedures, for sanctioning of the loan.

                The Complainant also handed over blank cheques to the OPs as security. The loan was to be repaid directly through the Bank by ECS. The Complainant was assured that the loan amount would be available within 3-4 days. 

                A week later, the Complainant was informed by M/s Axcess Services that Rs.1.25 lacs had been sanctioned as loan and the same would be paid on transfer of R.C. of the car in the name of the Complainant bearing hypothecation in the name of TATA Capital Ltd. The Complainant told the agent that he would not be able to purchase the car without the amount needed for the purchase.  The agent (OP No.2) then gave him a cheque of Rs.75,000/- from his own side, on the condition that the amount would be returned when the loan amount was received by the Complainant from OP No.1. The Complainant arranged the balance amount himself.

                The Complainant then purchased a 2^nd hand car make Santro bearing Regn. No.HR-51-K6114.  As  the car was earlier registered in Faridabad, it took about 2 ½ months for getting the vehicle transferred in the name of the Complainant with endorsement of hypothecation in the name of the OP.  On completion of all formalities, the Complainant contacted the agent of the company and also the OP and handed over the required documents to the OP. Though the Complainant went to the office of the OP No.1, he was not allowed to meet the Branch Manager of the company. Thereafter, the OPs kept dilly-dallying the matter. Meanwhile, the office of OP No.2 shifted and the Complainant thus has no knowledge about the new address.

                The Complainant has alleged that it is clear from these facts that the OP No.1 actually did not give any loan to the Complainant. There is no letter to the Complainant regarding sanction of loan, but still the OPs took undue benefit of the cheques and papers duly signed by the Complainant and kept taking the amount through the ECS from the Complainant’s account. 

                OP No.1 has now collected all installments of Rs.6077/- each from the account of the Complainant. The Complainant has only received Rs.75,000/- from OP No.2, which was to be returned to him, when the amount was received by the Complainant from the OP No.1.

                The Complainant has alleged that the OP No.1 is in fact, not entitled to recover any amount from him, as they have never paid any amount to him. The amount of Rs.75,000/- has been given by the agent while the recovery is being done by the OPs. The Complainant has also alleged that an amount of Rs.3,000/- has been charged from his account for documentation charges.  As per Annexure R-2, the document of TATA Capital Ltd. shows the invoice/ valuation as Rs.1.75 lacs. The loan amount is Rs.1.22 lacs. The tenure of installment is 24 months and documentation charges are Rs.3,000/-. Interest clause is left blank. The Complainant has alleged that the OPs cannot charge any interest or finance charges on the balance amount of Rs.50,000/-, which was not even received by him from the OP No.1.

                The Complainant ultimately sent a legal notice to the OPs, but no reply was received from them. He has, therefore, filed the instant complaint with the following prayer:-    

i)                    Stop cancellation of the installments from the bank account of the Complainant.

ii)                   To release the full amount of loan sanctioned to him;

iii)                 To re-schedule the installments after adjusting the amount already received from the Complainant.

iv)                To refund the excess interest charged from the Complainant.

v)                  A penalty of Rs.50,000/- be imposed on the OPs as penalty.

2]             After admission of the complaint, notice was sent to OP No.1.

3]             In the reply filed by OP No.1, they have taken the preliminary objection that there is no deficiency in service or negligence or any malafide intensions on their part.

                On merits, the OP No.1 had submitted that the loan in question was disbursed to the Complainant through OP No.2.  At the time of disbursal of loan, all terms & conditions were communicated to the Complainant.

                The OP has submitted that the Complainant applied for the loan through M/s Axcess Services, which is an independent unit and works for various banks and financial institutions. A loan of Rs.1.22 lacs was sanctioned, out of which Rs.3,000/- were deducted as documentation charges and Rs.1.19 lacs was disbursed for purchase of used Santro car on 23.7.2008. The loan was disbursed by the OP by way of cheque/ demand draft in the name of M/s Axcess Services, as per instructions of the Complainant. A copy of the loan-cum-hypothecation-cum-guarantee agreement and authority letter vide which the Complainant directed the OP to disburse the loan in the name of M/s Axcess Services have been placed on record at Annexure R-3 and R-4 respectively.

                It is clear that the Complainant was aware of the co-borrower and that a loan of Rs.1.22 lacs had been sanctioned with an EMI of Rs.6077/- payable on 7^th of each month for 24 months. Denying all other allegations of the Complainant, the OP has prayed for dismissal of complaint.

4]             At this stage, during the course of proceedings, the Complainant filed an application for interim relief for stay of recovery against him. It was averred that though the OP No.1 had never paid any amount to him, they had already taken 12 installments of Rs.6077/- each from the account of the Complainant through ECS. The Complainant made another application that OPs be directed to produce all the necessary documents like valuation report of vehicle, R.C. taken by the OP and complete case file of the financed case from the date of making the application.

                The OPs were directed to file their reply to the interim relief sought by the Complainant, along with reply to the main case.

                During the course of proceedings, the Complainant also made a request that he be allowed to implead Mr. Rajesh Narang of M/s Axcess Services as OP No.2. Thereafter, an amended complaint, along with affidavit of the Complainant was placed on record. 

                Notice was then sent to OP No.2.  However, since none appeared on behalf of OP No. 2, he was proceeded against ex-parte on 07.09.2010.

5]             OP No.1 has also filed written argument, wherein they have reiterated that the complaint is a well educated person and is a lawyer by profession and it is not possible that he did not read the documents before signing the same. The Complainant and his daughter themselves applied for the loan through M/s Axcess Services and the loan sanctioned was disbursed by the OP in the name of M/s Axcess Services only.

                Further, OP No.1 has also submitted that the alleged agent has nothing to do with their internal business activities and it is the Complainant himself, who brought him into the picture.

6]             We have heard the ld.Counsel for the parties and have also perused the evidence & documents led by the parties in support of their contentions along with the written arguments.

7]             The Complainant has placed on record his bank statement of Karnataka Bank Ltd., where the installments deducted from his account have been shown. On a perusal of the same, we find that 24 installments of Rs.6077/- each have been taken from his account by TATA Capital Ltd. through ECS. He has also placed on record a notice of contract termination issued by the OP to the RTO office, Chandigarh, which reads as under:-

“The above vehicle was covered under HIRE PURCHASE/ LEASE/ HYPOTHECATION agreement No. 7000022875, dated 23.7.2008.

As we have received the full HIRE PURCHASE/ LEASE/ HYPOTHECATION Dues, we hereby request that the HIRE PURCHASE/ LEASE/ HYPOTHECTION endorsement in our favour in the Certificate of Registration may be cancelled.”

8]             The amount alleged to have been disbursed by the OP No.1 has been withdrawn by them from the account of the Complainant.  the grouse of the Complainant is that even though the OP No.1 have not made any payment to him directly, they have deducted the full amount of loan, along with interest from his account. The OP No.1 have submitted in their reply, as well as at the time of arguments that the amount was disbursed to M/s Axcess Services, who are their agents. They have stressed that it is the Complainant himself, who approached them through this Agent, hence, the amount was disbursed to him also through this agent.

9]             The Complainant who appeared in person stressed on the fact that he had applied for loan to TATA Capital Ltd. (OP No.1) through their agent (OP No.2) and had in good faith signed all documents and handed over blank cheques, which were utilized by the OPs for taking back the loan amount However, he had actually received only Rs.75,000/- from the agent. The payment of the rest of the loan amount by the OP to the agent was not to his knowledge, since the agent had not forwarded this amount to him.

10]            It is a very interesting situation, where the OP No.1 seems to have no knowledge of the agent and has said that they are not responsible for the loan amount handed over to him. But, at the same time, they have taken all the necessary documents handed over by the Complainant to the agent at the time of sanction of loan amount. They have also withdrawn the complete installments from the account of the Complainant. In all, the Complainant has paid Rs.1,45,848/- to the OPs against a sanctioned loan of Rs.1.22 lacs. But, unfortunately, the Complainant had only received Rs.75,000/- of this sanctioned/ disbursed amount.  

11]            A complete look at the picture clearly shows that the agent of the OPs has kept the money with himself and not handed  it over to the Complainant. The OPs  may have handed over the money to him in good faith, just as the Complainant also signed all documents with him for the OPs in good faith. But, in these circumstance, we cannot hold the Complainant liable for the act of the agent of the OPs.

12]            In fact, we deem it appropriate that the OPs should refund the excess amount paid to them by the Complainant beyond Rs.75,000/-. The rate of interest, on which the amount was sanctioned has not been mentioned in any of the documents places on record. Only the EMI of loan has been mentioned and the rate of interest at Sr. No. 8 of annexure R-1 & R-2 has been left blank by the OPs. When no interest rate has been shown, we cannot understand at what rate of interest they have charged the Complainant for the loan.

13]            Keeping in consideration these facts and findings, we deem it appropriate to allow the complaint in favour of the Complainant. The OPs will refund all excess amount beyond Rs.75,000/- taken by them from the account of the Complainant. The loan amount beyond Rs.75,000/- may be recovered by them from their Agent to whom they have disbursed the amount.

14]            This complaint is accordingly, allowed. The OPs will refund the excess amount beyond Rs.75,000/- taken by them from the Complainant, within 30 days from the date of receipt of certified copy of this order, failing which the they shall pay the amount along with interest @12% per annum from the date of the order, till the date of actual payment to the complainant. Since the Complainant appeared in person, no cost of litigation need be given.

15]            Certified copies of this order be communicated to the parties, free of charge. After compliance file be consigned to record room.

Announced                                                                   

10^th Nov., 2010                                                 

Sd/-

LAKSHMAN SHARMA)

PRESIDENT

                             Sd/-

                                       (ASHOK RAJ BHANDARI)

MEMBER

                                                                                                Sd/-

                                                    (MADHU MUTNEJA)

MEMBER

‘Dutt’