BEFORE THE CONSUMER DISPUTES REDRESSAL FORUM, ERNAKULAM.

            Dated this the day of 22^nd day of October 2018

                                                                                                Filed on : 19.05.2018

PRESENT:

Shri. Cherian K. Kuriakose,                                              President.

Smt. Beena Kumari V.K.                                                  Member.

                        C.C.No. 214/2018 

Between

                                               O R D E R

Cherian K. Kuriakose, President

1. A brief statement of facts of this complaint is as stated below:

The complainant Sri.Unnikrishan T.K had availed a vehicle loan of Rs.350,000/- from the 2^nd opposite party for purchasing a Tata Indigo car.  The car was purchased and the registration number assigned to the Tata Indigo car was KL-7 BE 9171 and the car was purchased from M/s.RF Motors Ltd.  The re-payments period was from 02.04.2007 to 02.03.2012.  The complainant was required to pay the EMIs in 60 instalments.  The complainant had paid 12 instalments vide cheques and the subsequent instalments were paid in cash, which were collected by the staff of the 2^nd opposite party.  Although there was some inadvertent delay in payment of the instalments, the complainant continued to pay the EMIs without any default and the payment of the last instalment ie 60^th instalment was made by the complainant on 31.03.2012 and the 2^nd opposite party closed the loan transaction. The complainant was under the bonafide belief that the loan account would be closed by the 2^nd opposite party and the hypothecation would be lifted on payment of the last instalment.  Later the complainant decided to sell the vehicle and he approached the 2^nd opposite party with a request to lift the hypothecation and he came to know, with a shock, that the 2^nd opposite party had not lifted the hypothecation and had not closed the loan, account due to non-payment of Rs.32,574/- towards ‘delay payment’ charges, which amount was due at the time of paying the last and final instalment.  It is submitted by the complainant that he was not informed of any such dues towards delay payment charges at the time of payment of the last and 60^th instalment.  It is further stated in order to get a clear picture, the complainant sought for the account statement pertaining to the loan account from the opposite party.  The complainant was further shocked to find that the account statement showed a total arrears as on the date at Rs.112,267/- which was inclusive of the penal interest.  Aggrieved by the above demand created by the opposite party, the complainant issued a Lawyer Notice dated 23.12.2017.  On receipt of the above Lawyer Notice the 2^nd opposite party agreed to recall the demand and also to lift the hypothecation.  But in the reply notice dated 12.04.2018 the 1^st opposite party called upon the complainant to treat their reply as a ‘demand notice’ and informed the complainant that the No Objection Certificate (NOC) would be released only on payment of all dues which was assessed at Rs.31,900/- as on 10.04.2018 and thereafter only the loan account would be closed.  It is submitted that the payment of the last instalment was on 31.03.2012 and the exorbitant amount was thus demanded after a period of 6 years without any valid basis.  No notice or intimation was given by the opposite parties till date intimating the accrued of delay-payment charges or of any arrears and the opposite parties themselves have asked the complainant to treat their reply notice dated 12.04.2018 as their ‘demand notice’, which is legally not sustainable by any extent.  As per the reply notice only an amount of Rs.31,900/- was demanded to close the loan account.  Complainant contended that after receiving the entire loan instalments, the opposite parties are not  issuing the required NOC to lift the hypothecation endorsed in the RC Book of the vehicle.  It is contended that the above act of the opposite parties clearly amounted to deficiency in service on the part of the opposite parties.

It is further contended that the complainant had to suffer a lot of hardships on account of the indifferent, callous and irresponsible attitude of the opposite parties in not closing the loan account and in not lifting the hypothecation despite receipt of the entire instalments in time and the demand of exorbitant amount towards ‘delay charges’ after the elapse of around 6 years is unsustainable by any law.  The complainant therefore sought for the directions of this Forum to the opposite parties to recall the illegal demand, to close the loan account bearing contract No.5000072703 and to issue the requisite NOC to enable the complainant to lift the hypothecation of the vehicle and to settle the vehicle.  The complainant also sought for a direction of this Forum to the opposite parties to pay an amount of Rs.50,000/- to the complainant towards compensation for the mental agony and hardships caused to the complainant along with costs of this proceedings.

2. Notice was issued from this Forum to the opposite parties on 28.05.2018 and the opposite parties appeared through their Counsel on 19.06.2018.  The opposite parties sought for further time for filing their vakalath and version.  This Forum allowed 25 days to file their version and the case was posted to 21.07.2018.  On the said date the Counsel for the opposite parties appeared and filed the vakalath but the version was not filed within the extended time allowed ie., within 15.07.2018.  Therefore the case was posted to 13.09.2018 for trial steps and on 13.09.2018 the opposite parties moved a petition in IA No.447/2018 with a prayer to accept the version.  In the affidavit filed along with the petition it is submitted by the opposite party that due to the natural calamities that affected the State of Kerala in August, 2018, the officials of regional office could not ascertain the details of the file hence delay occurred in filing the version.  The prayer to accept the version was allowed on condition that the opposite parties pay a nominal amount of Rs.5000/- towards costs to the Chief Ministers Relief Fund and produce the receipt within one month and the case was posted to 15.11.2018.  On 18.09.2018 the Counsel for the complainant moved a petition in I.A.NO459/2018 to advance the case.  It is submitted that the complainant had filed an interim application in I.A351/2018 on previous posting date stating that the vehicle was purchased in 2007 and the complainant is desirous of selling the vehicle in order to purchase a new car, that the complainant had earlier sought for the direction of the Forum to the opposite parties to issue the requisite NOC so as to enable him to lift the hypothecation of the vehicle.  Again this I.A.No.459/18 is moved by the complainant seeking the direction of this Forum to the opposite parties to issue the requisite NOC pertaining to the loan account of the complainant so as to enable the complainant to lift the hypothecation of vehicle and to sell the vehicle bearing registration No. KL7BE 9171 for the reasons explained by the Counsel for the complainant, I.A No.459/18 which was filed with a prayer to advance the case was allowed on 18.07.2018.  The case was then posted to 28.09.2018 and Counsel for both the parties appeared and the opposite parties sought for time to settle the matter.  Hence the case was posted to 06.10.2018 for reporting settlement.  But the matter was not reported as settled as on 06.10.2018 and the case was posted to 12.10.2018 and to 17.10.2018.  On 17.10.2018 the Counsel for the opposite parties sought for further time and it was also submitted that the NOC had already been issued from the Head Office.  We find that the opposite parties have not so far paid the costs of Rs.5000/- to the Chief Ministers Relief Funds, for accepting their version.  Therefore the opposite parties are legally not entitled to get the belated version to be considered by this Forum.  Hence the Counsel for both the parties were heard on 17.10.2018 and the case was posted for disposal on 20.10.2018.  The order was not ready as on 20.10.2018 and the case was posted for disposal to 22.10.2018.
3. The issues to be considered in this case are as follows:

1. Whether the complainant has proved any deficiency in service or unfair trade practice on the part of the opposite parties?
2. Whether the opposite parties are legally bound to issue NOC in respect of the vehicle No.KL7 BE 9171 for which a loan had been taken by the complainant so as to enable the complainant to lift the hypothecation of the vehicle and thereafter to sell the vehicle?
3. Whether the opposite parties are liable to pay to the complainant compensation of Rs.50,000/- for the hardships and inconvenience caused if any to the complainant along with costs?

4. Issue No. (i)

The complainant had availed a vehicle loan of Rs.350,000/- from the 2^nd opposite party- M/s.Tata Motors Finance Ltd, Branch office at Chembumukku, Kochi-21. The complainant purchased a car with RC No. KL07-BE-9171 by utilizing the loan amount. The 1^st opposite party – Tata Motors Finance Ltd is a Company incorporated under Section 45- IA of the RBI Act, 1934 as a non-banking company with its registered office at Mumbai.  The opposite party contended that this complaint is not maintainable before this Forum.  The facilities rendered by a Bank is covered under ‘service’ under Section 2 (1) (0) of the Consumer Protection Act as decided by the Hon’ble Supreme Court in the case reported in 2000 (2) Consumer Protection Act (SC) 204.  Hence the 1^st opposite party is a ‘service provider’ and the complainant who availed the facility of vehicle loan from the opposite parties is a ‘consumer’.  The loan amount availed by the complainant-consumer was for purchasing a Tata Indigo car.  We have considered the evidences filed by the opposite party the loan was sanctioned early on 27.02.2007 as evident from the annexure ‘A’ to the 1^st document submitted by the opposite party ie the loan cum Hypothecation agreement entered into between the complainant and the opposite parties. The 2^nd document submitted by the opposite parties is the repayment schedule for the period from 28.02.2007 to 02.03.2012 stating that the due date of payment was on the 2^nd day of each month.  The third document produced by the opposite party showed the repayment status as on 29.12.2015 in respect of loan instalments paid by the complainant – consumer.  On verification of repayments status in document No.3 submitted by the opposite parties, it is revealed that the complainant-consumer had paid all the 60 instalments.  It is pertinent to note that the EMIs calculated is inclusive of interest on the loan amount of Rs.350,000/- and there was a balance due of Rs.32,534/- as on 31.03.2012.  The said amount related to delay charges and was demanded after 6 years. There was delay in paying the instalments.  There was 1,2,3,5 or 29 days of delay as calculated by the opposite party after appropriating delay charges from the EMIs paid.  Nowhere in the loan cum Hypothecation the rate of interest for the delay charges is stated and the opposite parties unilaterally charged interest towards delay charges to which the complainant-consumer had not agreed.  Further the loan period commenced on 28.02.2007 and ended on 02.03.2012 and the entire loan amount was paid by way 60 EMIs as on 31.03.2012.  The delay charges of Rs.32574/- as on 31.03.2012 was not demanded by the opposite party within 3 years ie., within 31.03.2015.  If at all any amount was due from the complainant, the opposite parties ought to have demanded such dues before ending the limitation period of 3 years ie before 31.03.2015.  The demand of Rs.32,574/- was sleeping in the files of the opposite party for 6 years. It was in the reply notice dated 12^th April 2018 to the complainant’s Advocates Notice dated 23.12.2017) that the opposite parties required the complainant to treat the reply notice dated 12.04.2018 as ‘demand notice’ and it was also noticed to the complainant that an amount of Rs.31,900/- is due from the complainant as on 10.04.2018.  Thus it took 6 long years for the opposite parties to demand the ‘delay charges of Rs.31,900/- as against Rs.32594/- which was due on 31.03.2012, the closing date of loan period and the claim demanded after 6 years is barred by limitation on date prior to 3 years.  In instant case during the period from 31.03.2012 to 12.04.2018 (date of reply notice) there was also no acknowledgment from the complainant-consumer, to get over the period of limitation.  Therefore the demand for Rs.31,900/- which was accrued on 31.03.2012 and demanded by the opposite parties is cancelled as time barred. Thus we find that the complainant has proved deficiency in service and unfair trade practice on the part of the opposite parties in demanding exorbitant money after 6 years from the complainant towards delay charges the rate, which was unilaterally fixed by the opposite parties.  Demanding a time barred dues is not legal and is an unfair trade practice on the part of reputed finance company like the opposite parties.  Thus the 1^st issue is decided in favour of the complainant.

5. Issue Nos. (ii) and (iii)

For the reasons aforesaid the opposite parties are legally bound to issue NOC in respect of the loan taken by the complainant for the purchase of vehicle No. KL-7-BE 9171. However the opposite parties filed a memo on 20.10.2018 stating that the opposite parties are ready to give the complainant the NOC and prayed for 2 weeks’ time to give the NOC as NOC is to be given from the Head Office of the 1^st opposite party.  Even then we find that the complainant is entitled to get the compensation claimed of Rs.50,000/- for the unfair trade practice committed by the opposite parties and for the mental agony and hardships suffered by the complainant and for his inability to sell the above said vehicle for want of NOC from the opposite parties after lifting the hypothecation attached to the subject vehicle.  In the circumstances the opposite parties have agreed to issue the NOC and for the reasons stated in the foregoing paragraph, we direct the opposite parties to issue the NOC to the complainant within 30 days from the date of receipt of a copy of this order.

6. In the result this complaint is allowed and we direct as follows:

1. The opposite parties shall issue the NOC in respect of the car KL-07 BE 9171 for which the vehicle loan was availed by the complainant, within 30 days from the date of receipt of a copy of this order, failing which the opposite parties shall pay Rs.1 lakh as compensation to the complainant for the monetary loss and sufferings suffered by him due to the denial to provide the NOC within time.  If the opposite parties complies this order as aforesaid by issuing the NOC within 30 days from the date of receipt of this order, the compensation would be limited to Rs.30,000/- only. 

2. The opposite parties shall pay Rs.5000/- towards cost of the proceedings.

The above orders shall be complied with, within 30 days from the date of receipt of a copy of this order.

Pronounced in the open Forum on this the 22^nd day of October 2018.

Sd/-Cherian K. Kuriakose, President

Sd/-Beena Kumari V.K. , Member

                                                              Forwarded by Order

                                                              Senior Superintendent

APPENDIX

Docu. 1       : produced not marked. (Loan cum hypothecation cum   

                     Guarantee agreement) 

          Docu. 2       : produced not marked [Repayment schedule issued by                    

                              Tata Motors Finance Limited (Formerly known as Sheba 

                               Properties Ltd.)]

          Docu. 3       : produced not marked. (Repayment schedule)

          Docu. 4       : produced not marked. (Contract details dated 10.09.2018)

Date of Despatch :

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