BEFORE THE A.P.STATE CONSUMER DISPUTES REDRESSAL COMMISSION: AT HYDERABAD.

C.C.No.66 OF 2012

Between

1.           D.Jagannath S/o Eswar, aged 63 years, retd.employee

2.           D.Shakuntala Devi w/o D.Jagannath, aged 60 yrs, Housewife

3.           Neha Sahai D/o late Rajesh Sahai, aged 19 yrs, student

4.           D.Premdas s/o late Eshwar, aged 60 yrs

5.           D.Rukmini Das W/o D.Premadas, aged 52 yrs, Housewife

6.           D.Pankaj Das, S/o D.Premdas, aged 27 yrs, Pvt.Employee

7.           D.Sanketh Das, S/o D.Premdas, aged 25 year, Pvt employee

8.           D.Jayaprakash, S/o late Eswar, aged 56 yrs, Govt. Servant

9.           D.Rohit Das, S/o D.Premdas, aged 20 yrs, Student

10.                Smt Ahalya, W/o Sri T.Ramachander, aged 52 yrs, housewife

11.                T.Ramachander, S/o Narasinga Rao, aged 63 years,

12.                T.Pushpa, W/o T.Ashok, aged 48 yrs, Housewife

All are close relatives and residents of 2-2-1,
Arunodayanagar Colony, Road No.6, Post GSI,
Nagole, R.R.District, Hyderabad-68

            A N D

1.   Telegraph Traffic employees Cooperative Credit Society
rep. by the Person In charge committee, DTO Koti
Hyderabad-095

2.   E.Rajender Prasad Reddy, Liquidator
DTO, Koti, Hyderabad

Opposite parties

C.C.No.67 OF 2012

Between

1.   S.Subramanya Sarma S/o Sanjeevi Sarma SDE BSNL, aged 57 yrs

2.   V.Adilakshmi W/o S.Subramanya Sarma, , aged 54 yrs Housewife

3.   S.Vishnu Vardhana Sarma, S/o S.Subramanya Sarma working in
Mahindra Satyam

4.   S.Lakshmi W/o late Sri S.Sanjeevi Sarma, aged 79 yrs, housewife – family pensioner

All are R/o 16-11-317/206,Flat No.206, Turabis Archies Enclave
Moosarambagh, Malakpet, Hyderabad-36

5.   S.Kumara Sarma Central Govt. Employee, S/o Sanjeevi Sarma
aged 37 yrs, A-5 Aman Nivas Bagdola, Sector 8 Dwarka, New Delhi

6.   S.Shiva Shankar Sarma S/o Sanjeevi Sarma, aged 44 yrs,

R/o 16-11-317/206, Flat No.206, Turabis Archies enclave Moosarambagh, Malakpet Hyderabad-03

7.   V.Raghu Ramaiah (Retd.State govt.employee) S/o Varanasi
Narsingarao, aged 65 yrs, 10-2-5, Ponakavari St. Kavali, Nellore Dt.

8.   J.Sreelakhsmi (housewife) W/o Sri J.Venkateswara Rao
aged 62 years, R/o 16-11-317/206, Flat No.103, Turabis Archies enclave Moosarambagh, Malakpet Hyderabad-036

9.   J.Venkateswara Rao
R/o 16-11-317/206, Flat No.103, Turabis Archies enclave Moosarambagh, Malakpet Hyderabad-036

            A N D

1.   Telegraph Traffic Employees Cooperative Credit Society
rep. by the Person In charge committee, DTO Koti
Hyderabad-095

2.   E.Rajender Prasad Reddy, Liquidator
DTO, Koti, Hyderabad

Opposite parties

Counsel for the complainant          M/s Bommana Rajakrishna  

Counsel for the opposite parties     M/s.K.Veerabhadra Rao

QUORUM:   SRI R.LAKSHMINARASIMHA RAO, HON’BLE MEMBER

                                                AND

SRI THOTA ASHOK KUMAR, HON’BLE MEMBER

FRIDAY THE NINETEENTH DAY OF OCTOBER

                                TWO THOUSAND TWELVE

Oral Order (As per Sri R.Lakshminarasimha Rao, Hon’ble Member)

                                                        ***

1.             Since both these complaints deal with similar facts, they are being disposed of by a common order.  C.C.No.66 of 2012 is taken as lead case.

2.             The averments made in the complaint are that the complainants deposited the following amounts with the opposite partyno.1 society repayable with interest @ 14% p.a. to be paid in monthly instalments.

C.C.No.66 of 2012

C.C.No.67 of 2012

3.            The opposite party no.1 paid the monthly interest till the date of maturity and failed to pay the amount for the subsequent period.  The complainants came to know that the opposite party society was closed and an Enquiry Officer was appointed to conduct an enquiry into the affairs of the opposite party society U/s.51 of A.P. Co-op. Societies Act. The enquiry officer submitted his report on 19-6-2009 and appointed the person in charge to look after the affairs of the society. The complainants submit they are entitled to Rs.19,79,000/- with interest from August 2008 and compensation and costs. 

4.             The liquidator of the opposite party society filed their written version stating that the complainants are not the members of the opposite party society and they had deposited the amounts for which the FDRs were issued by its Ex-Secretary Sri A.Krishna Murthy.  As per the rules and bye-laws of the society, deposits from  persons other than members should not have been accepted.   The Ex.Managing Committee was ceased by the Deputy Registrar/Divisional Co-operative Officer, Golconda and in its place a 7 Member person in-charge committee with a Deputy Registrar as PIC Chairman was appointed and the opposite party society was ordered for liquidation vide proceedings No.ARC No.1160/2011-Cr/ECCS. An enquiry was ordered on 29-9-2008 and the Enquiry Officer submitted his report initiating proceedings against the Ex.Secretary, Mr.A.Krishna Murthy. The complainants have not made any written representation and their deposit details are not available with the society.

4.             The liquidator had taken charge on 15-7-2011 and has to first ascertain the liabilities and assets of the society and the liquidator is making arrangement for issuing notice U/R.51 (b) of the APCS rules, 1964 inviting all claims against the society and then the liquidator will be in a position to make payments on any dues on a prorata basis subject to availability of funds. The opposite party further submits that some of the depositors have approached the Hon’ble High Court, and the High Court passed interim stay in W.P.Nos.16080/2011 and 17708/2011. It is essential to issue notice to the liquidator with the permission of Registrar of Societies U/s.126 of A.P.C.S.Act which was not followed as per the mandatory provisions and therefore the complainant is not entitled for any relief.  The Hon’ble National Commission in F.A.No.211 of 2011 and F.A.No.241 of 2010 vide its order dated 9.11.2011 directed the petitioners to seek recovery of the amounts from the Liquidator in accordance with law.  This Commission has no jurisdiction to entertain the complaints.

5.             In support of their claim the complainant no.1 has filed affidavit and Exs.A1 to A12 are marked on their behalf. On behalf of the opposite parties neither affidavits nor documents are filed.

6.             The point for consideration is whether the complainants are entitled to the amount deposited by them?

7.             The complainants made the deposits with the opposite party no.1 on either or survivor basis and also received the interest upto August 2008.  Thereafter they did not receive any interest and inspite of repeated requests and several personal visits, the opposite party did not choose to pay the deposit amount and the interest thereon. The complainant filed Exs.A1 to A12 evidencing the deposits made by them with the promised interest @14% p.a. It is the opposite party’s case that a liquidator was appointed on 25-6-2011 vide proceedings No.ARC 1160/2011-Cr/ECCS. The opposite party contended that the National Commission in F.A.No.211/2010 and 241/2010 directed the opposite party-society to pay an amount of `28,34,778/- to the complainants with liberty for the complainants to move the Special Court for the purpose of recovery of the amounts or seek recovery of the amounts from the liquidator as per due the prescribed procedure.

8.             The complainants were held entitled for recovery of amounts due from opposite party society.  The National Commission held the complainants cannot proceed against the then Members of the Managing Committee or Directors U/s.25 and 27 of Consumer Protection Act, 1986. It is the contention of the opposite party that as a liquidator has been appointed, the liabilities and assets of the society has to be ascertained and then dues can be paid on a prorata basis subject to availability of funds. It is not disputed that the Ex.Secretary, Sri A.Krishna Murthy had committed fraud and a criminal case has been filed against him and his properties have been seized by the Central Crime Station, Nampally. It is an admitted fact that the complainants deposited amounts and  Ex.Secretary had committed irregularities and is facing criminal proceedings, at this belated stage, the opposite party cannot raise the contention that the F.D.Rs. ought not to have been issued to non-members.

9.             The deposit receipts were issued in the year 2007 and interest was paid till August 2008 and therefore the contention that the complainants are non-members even after issuance of the F.D.Rs. and payment of interest by the opposite party is unsustainable.

10.             The remedy under the Consumer Protection Act, 1986 is available as such a remedy not in derogation to the provisions of A. P. Co-op. Societies Act, 1964. The National Commission in F.A.No.211/2010 and in F.A.241/2010 has observed that the complainant is at liberty to move the Special court for recovery of amount their amounts or may seek recovery from the liquidator as per due procedure in. In the instant case the liquidator has already been appointed. The decision of the National Commission in R.P.No.1768/2000, 1769/2000 and 2886/2005 dated 3-4-2007 reads as follows:

                        “In view of the matter, particularly when liquidation petition for winding     up is pending before the High Court of Bombay and the fact that a Special Committee is appointed and functioning under the High Court and that it has drawn a plan for repayment to the depositors/investors as             quoted, we hereby direct that neither the State Commissions nor the Dist. Forums, would proceed further with the dispute which are pending against Lloyds Finance Ltd., However, it would be open to the Dist. Forums or the State Commissions to finalize the amount payable by the company (payment  of interest and compensation would be subject to final orders of the special committee or the liquidator) and/or to direct the investors to lodge a claim before the Special Committee. These directions shall be abided by Consumer Fora all over the country”.

11.            Keeping in view the aforementioned decision which allows the Commission to quantify the amounts, we herewith observe that the complainants in C.C.No.66 of 2012 are entitled to an amount of `19,79,000/- with interest @ 14% per annum from 1.8.2008 till the date of filing of the complaint and the complainants in C.C.No.67 of 2012 are entitled to `18,38,500/- with interest at 14% p.a. from 1.8.2008 till the date of filing of the complaint.  The complainants are at liberty to approach the liquidator for payment of these amounts. The opposite party has not adduced evidence to establish that the complainants herein are a party to the proceedings in the Writ Petitions filed before the Hon’ble High Court.

12.            In the result the complaints C.C.No.66 of 2012 and C.C.No.67 of 2012 are allowed in part  and the complainants are directed to approach the liquidator for payment of `19,79,000/- and `18,38,500/- together with interest from 01.08.2008 till the date of complaint and costs of `5,000/- within four weeks from the date of receipt of this order.

                                                                                MEMBER

                                                                                MEMBER

                                                                            Dt.19.10.2012

KMK*

APPENDIX OF EVIDENCE

WITNESSES EXAMINED

For complainants                                                         For opposite parties

NIL                                                                           NIL

C.C.NO.66 OF 2012

For Complainants

Ex. A1                   Fixed Deposit Receipt – Rs. 2,75,000/-

Ex. A2                   Fixed Deposit Receipt – Rs. 1,85,000/-

Ex. A3                   Fixed Deposit Receipt – Rs. 50,000/-

Ex. A4                   Fixed Deposit Receipt – Rs. 1,00,000/-

Ex. A5                   Fixed Deposit Receipt – Rs. 2,00,000/-

Ex. A6                   Fixed Deposit Receipt – Rs. 2,00,000/-

Ex. A7                   Fixed Deposit Receipt – Rs. 2,00,000/-

Ex. A8                   Fixed Deposit Receipt – Rs. 1,94,000/-

Ex.A9          Fixed Deposit Receipt – Rs. 2,00,000/-

Ex.A10        Fixed Deposit Receipt – Rs. 50,000/-

Ex.A11        Fixed Deposit Receipt – Rs. 8,00,000/-

Ex.A12        Fixed Deposit Receipt – Rs. 50,000/-

For opposite parties

NIL

CC No.67 of 2012

For complainants

Ex. A1                   Fixed Deposit Receipt – Rs. 10,000/-

Ex. A2                   Fixed Deposit Receipt – Rs. 10,000/-

Ex. A3                   Fixed Deposit Receipt – Rs. 15,000/-

Ex. A4                   Fixed Deposit Receipt – Rs. 30,000/-

Ex. A5                   Fixed Deposit Receipt – Rs. 10,000/-

Ex. A6                   Fixed Deposit Receipt – Rs. 18,000/-

Ex. A7                   Fixed Deposit Receipt – Rs. 75,000/-

Ex. A8                   Fixed Deposit Receipt – Rs. 20,000/-

Ex.A9          Fixed Deposit Receipt – Rs. 2,25,000/-

Ex.A10        Fixed Deposit Receipt – Rs. 25,000/-

Ex.A11        Fixed Deposit Receipt – Rs. 1,00,000/-

Ex.A12        Fixed Deposit Receipt – Rs. 5,000/-

Ex. A13       Fixed Deposit Receipt – Rs. 5,000/-

Ex. A14       Fixed Deposit Receipt – Rs. 1,00,000/-

Ex. A15       Fixed Deposit Receipt – Rs. 6,500/-

Ex. A16       Fixed Deposit Receipt – Rs. 1,40,000/-

Ex. A17       Fixed Deposit Receipt – Rs. 10,000/-

Ex. A18       Fixed Deposit Receipt – Rs. 9,000/-

Ex. A19       Fixed Deposit Receipt – Rs. 32,000/-

Ex. A20       Fixed Deposit Receipt – Rs. 33,000/-

Ex.A21        Fixed Deposit Receipt – Rs. 1,50,000/-

Ex.A22        Fixed Deposit Receipt – Rs. 1,00,000/-

Ex. A23       Fixed Deposit Receipt – Rs. 1,00,000/-

Ex. A24       Fixed Deposit Receipt – Rs. 10,000/-

Ex. A25       Fixed Deposit Receipt – Rs. 1,47,000/-

Ex. A26       Fixed Deposit Receipt – Rs. 53,000/-

Ex. A27       Fixed Deposit Receipt – Rs. 50,000/-

Ex. A28       Fixed Deposit Receipt – Rs.4,00,000/-

Ex. A29       Letter from Vishnu Vardhana, date 10.11.2012

Ex. A30       Letter from Vishnu Vardhana, date 21.08.2008

Ex.A31        Letter from Vishnu Vardhana, date 02.09.2008

Ex.A32        Letter from Vishnu Vardhana, date 29.12.2008

For opposite parties

NIL

                                                                        MEMBER

                                                                        MEMBER