This Complaint coming up before us for hearing on                     18-05-11 in the presence of Sri A. Adinarayana, advocate for the complainant and of Sri L.V. Kumar, advocate for opposite party                        upon perusing the material on record after hearing both sides and having stood over till this day for consideration this Forum made the following:-

O R D E R

Per Sri A. Hazarath Rao, President:-

        The complainant filed this complaint U/S 12 of Consumer Protection Act seeking a direction to the opposite party for payment of Rs.2, 70,000/- together with interest and Rs.10, 000/- towards costs.

2.     In brief the averments of the complaint are these:

The complainant is a subscriber of chit bearing No.T-NLO-1/21 for Rs.5, 00,000/- spread over for 40 months @Rs.12, 500/- pm.   The said chit commenced on 20-09-01.   The complainant paid last installment on 12-12-04.  The opposite party has to pay Rs.4.75, 000/- within 30 days from the date of last auction.   The complainant came to know that Chirala branch of the opposite party filed OS 67/04 and sought attachment for Rs.2, 05,000/-.   The opposite party kept Rs.2, 70,000/- in its custody without sending the said amount to the complainant.   The opposite parties have to pay interest on Rs.2, 70,000/- from 12-12-04.   After repeated requests the opposite party sent a DD for Rs.1, 57,150/- on 12-05-09 without any letter.   The opposite party did not give proper reply when confronted by the complainant for issuing demand draft for Rs.1, 57,150/- only.   The said attitude of the opposite party amounted to deficiency of service.  The complaint therefore be allowed.    

3.    The contention of the opposite party in brief is hereunder:

The complainant is not a consumer and there is no consumer dispute.   The complainant subscribed a chit in the opposite parties branch at Tenali bearing ticket No.TMLO-1/21.  The value of the said chit was Rs.5, 00,000 spread over for 40 months @ RS.12,500/- pm.   The complainant became successful bidder in the auction held and agreed to forego Rs.25, 000/-.  The opposite party has to pay the prize amount of Rs.4, 75,000/- to the complainant.  The complainant stood as a surety in a chit with Bapatla branch and a suit was filed in OS 261/04 on the file of Junior Civil Judge Court, Bapatla.   The complainant also stood as surety in the matter covered by OS.No.190/04 on the file of Junior Civil Judge Court, Bapatla and in OS.No.67/04 on the file of Junior Civil Judge Court, Chirala.   The complainant also stood as surety to Mr K. Suresh Kumar in 38015/19 of Bapatla branch.   After considering all those things, the opposite party addressed several letters to the complainant requesting him to come and receive the cheque.   As the complainant did not come, the opposite party sent a DD for RS.1, 57,150/- on 12-05-09 exercising lien for the remaining amount.  There are no bonafides on the part of the complainant in filing the complaint.   The complaint therefore be dismissed.   

4.     Exs.A-1 to A-5 on behalf of the complainant and Exs.B-1 to B-12 on behalf of opposite party were marked.

5.      Now the points that arose for consideration in this case are:

1. Whether the complainant is a consumer?
2. Whether the opposite party committed deficiency of service?
3. Whether the opposite party has a lien over the prize amount to which the complainant stood as a surety to others?
4. Whether the complainant is entitled to compensation?
5. To what relief?

6.   Undisputed facts in this complaint are:

          1. The complainant is a subscriber of the chit No.T-LNo.-1/21.

        2. The value of the chit was Rs.5, 00,000/- spread over for 40   months @ Rs.12, 500/- pm.

        3. The chit commenced on 20-09-01.

        4. The date of termination of chit was on 20-01-05 (Ex.B-12).

        5. The complainant became a prized subscriber for                                   Rs.4, 75,000/-.

        6. The opposite party sent a cheque for Rs.1, 57,150/- to the                    complainant on 12-05-09.

7.   POINT No.1:-    The complainant is a subscriber of the chit conducted by the opposite party.   Foreman of the opposite party is collecting commission charges for every chit as per law.  It can therefore be said that the complainant is a consumer within the purview of Consumer Protection Act.   Hence, this point is answered in favour of complainant.

8.   POINT No.3:-    Ex.B-12 is copy of agreement of chit dated                31-10-01 between the parties to the complaint. Clause 17(b to d) of Ex.B-12 deal with lien over amounts and they read as follows:

“b) Lien over amounts: if the chit subscribers are indebted to the foreman for any amount either personally or as surety the foreman will have in respect or such liabilities first charge over any amount that may be due to them from the foreman and other assets lying with the foreman.   The Foreman has the right to adjust such amount towards his liabilities without prior notice.   Only, the balance if any will be paid to the subscribers.

c) If the subscriber has any non-prized chit amount or F.Ds with the Foreman, the Foreman has the right to foreclose the chits & F.Ds. he has, the adjust the amount towards his liabilities/prized arrears.

d) If the subscriber is a surety to any prized subscriber, who becomes default subsequently, the amount paid by such subscribers either for non-prized chits or deposits will be foreclosed by the Foreman and the amount will be adjusted towards the defaulted subscriptions as he jointly and severally liable to the debts”.    

9.     Original of Ex.B-12 binds both the parties. The said clause revealed that the opposite party has lien over the amount due to it by a prized subscriber either as a principle debtor or a surety to other prized subscribers.   Clause 17 (b to d) of Ex.B-12 in our considered opinion authorized the opposite party to exercise general lien.  Hence this point is answered in favour of the opposite party.

10.   POINT No.2:-    The complainant in his affidavit as well as complaint mentioned that he paid last installment on 12-12-04 and the same was not denied by the opposite party.  It can therefore be said that the complainant paid all the installments. Therefore the contention of the opposite party that the complainant was due in a sum of Rs.24,937/- cannot be accepted (in the subject chit).                    Like-wise a sum of Rs.7,50/- towards documentation charges alleged to have been incurred by the opposite party.  

1. Since the complainant became the prized subscriber in the last installment he is entitled to chit amount of Rs.5,00,000/- minus Rs.25,000/- (i.e., commission of foreman @5%) = Rs.4,75,000/-.  Under those circumstances, the complainant need not furnish any security to the opposite party company.   Ex.B-2 and B-11 revealed that an amount of Rs.2,33,944/- was attached in OS.No.67/04 on the file of Junior Civil Judges Court, Chirala.  The opposite party received Ex.B-11 notice in IA No.158/05 in OS 67/04 on 19-02-05.   But the opposite party sent demand draft for Rs.2, 33,944/- on 26-04-06.

1. By the most the opposite party has to pay the prized amount to the complainant by 31-12-04.  The opposite party intentionally waited to get the attachment order in OS 67/04.  No doubt the opposite party can exercise lien over the amount due by the opposite party either as a borrower or guarantor to others by virtue of clause 17(b to d) of Ex.B-12.  The opposite party in its version as well affidavit mentioned regarding various amounts due by the complainant as a guarantor in other cases.    The complainant did not refute the said allegation in his affidavit for the reasons best known to him.   The opposite party in our considered opinion did not wait till the dates mentioned in Ex.B-1, B-3, B-4 and B-6.   Withholding amount for a considerable time and exercising lien at the whims and fancies of the opposite party in our considered opinion amounted to deficiency of service and unfair trade practice also.

1. Under those circumstances, awarding interest @12% pa as discussed infra will meet ends of justice i.e., directing the opposite party to pay interest on Rs.4, 75,000/- @12% p.a., from 01-01-05 to 25-04-06; interest @12% p.a., on Rs.2, 05,210/- from 26-04-06 to 17-03-08 (Ex.B-3); interest @12% p.a., on 1.90,010/- from 18-03-08 till 12-05-09 and @12% p.a., on Rs.1, 83,010/- from 13-05-09 till realization. Hence this point is answered accordingly in favor of the complainant.

14.    POINT No 4:-  The complainant is justified in not accepting Ex.A-5 DD dated 12-05-09.   The amount covered by Ex.A-5 DD differed from the amount mentioned in Ex.A-4 letter dated 20-10-06 addressed by the opposite party. The attitude of the opposite party in deducting the amounts by exercising lien at its whims and fancies caused harassment and agony to the complainant. Awarding a sum of Rs.10, 000/- on that head will meet ends of justice.  Hence, this point is answered accordingly in favour of the complainant.

15.   POINT No.5:-    In view of the above findings, in the result the complaint is allowed partly as indicated below:

1. Directing the opposite party to pay Rs.1, 83,010/- (Rupees one lakh, eighty three thousand and ten only) together with interest @12% p.a., from 13-05-09 till realistaion.
2. Directing the opposite party to pay interest only on Rs.4, 75,000/- @12% p.a., from 01-01-05 to 25-04-06; interest @12% p.a., on Rs.2, 05,210/- from 26-04-06 to                17-03-08 (Ex.B-3); interest @12% p.a., on 1,90,010/- from 18-03-08 to 12-05-09 and @12% p.a.,
3. Directing the opposite party to pay  a sum of Rs.10, 000/- (Rupees ten thousand only) towards compensation and           Rs.2, 000/- (Rupees two thousand only) towards costs.
4. The amounts ordered above shall be paid within a period of six weeks from the date of receipt of the copy of the order.

Dictated to junior stenographer, transcribed by her, corrected by me and pronounced in the open Forum dated this the 3rd day of June, 2011. 

MEMBER                                             MEMBER                                        PRESIDENT

APPENDIX OF EVIDENCE

  DOCUMENTS MARKED

For Complainant:

For opposite party:        

                                                                                               PRESIDENT